TiVo and Xperi, which specializes in semiconductor technology and various audio and video brands, announced that the two companies had just reached a $3 billion patent merger. The deal itself also marks the end of the DVR era. In 2016, Rovi brought tiVo’s predecessor into the company for $1.1 billion, which has a large number of profitable patents. After the acquisition, Rovi renamed it TiVo and continued to make a profit through the licensing business. For now, however, it will continue to merge with California-based Xperi.
(From TiVo, via TheVerge)
Earlier this year, RoVi tried to split TiVo into two separate companies. Separate the once-popular product division from the consumer-facing but lucrative patent licensing business. However, with the merger with Xperi, the program has been canceled.
TiVo is known for its groundbreaking DVR set-top box (which is still in production today), although its popularity is far less than the market needs. Most of the company’s revenue, including after and before the acquisition of Rovi, comes from licensing patents to other suppliers.
As with the 2016 acquisition, the new deal is focused on IP licensing rather than TiVo’s DVR hardware, according to market analyst Avi Greengart. However, there are reports that the merger will continue to offer TiVo-branded related products.
It’s similar to Xperi’s acquisition of audio technology brand DTS in 2016, so it’s no wonder. In a press release, Xperi proudly declares:
“The two companies have tens of thousands of patents and applications, and there is very little overlap between the granting objects, so the combined IP business will make it one of the largest licensing companies in the world.”