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$8.46 0.15 (1.81%)
8/29/2008 4:00 PM

TiVo, Inc. (TIVO)

CAPS Rating:
**

The Company is a provider of technology and services for digital video recorders.

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Avatar jfosu (93.62) Submitted: 7/21/08 8:49 AM : Outperform Start Price: $7.68 TIVO Score: -3.66

Every cable company has DVR but not one has it like Tivo. Their technology allows them to anonymously collect viewing information through all of their subscribers. They collect information on their viewers' habits - what shows do they watch, what do they rewatch, and what do they skip over? This yields the most in depth insight into customer likes/dislikes possible. Thus, their potential for maximizing advertising for third parties is very high. I view them as a potential consulting service with the best possible information. They have recently begun to dabble with this and I expect this is where their business will flourish going forward.

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Avatar hagrin (82.28) Submitted: 7/22/08 3:31 PM

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The only thing that TiVo has going for it is brand recognition. Just like people say they will go "google" something, people use TiVo as a verb when talking about digitally recording television programming. If you end up being right about this pick, this will be one of the main reasons why. That or they get acquired.

However, that's where it ends. If we learned anything from Vonage (NYSE:VG), we learned that the cable, phone and fiber providers can do it cheaper and have direct access to the customer's most basic service. For Vonage, it was the coaxial and fiber run to the customer homes allowing them to be able to control the traffic over those lines that Vonage needed to piggyback. TiVo has to be able to piggyback the television service delivered to the homes and they have to do it in a very cost ineffective way.

This is a stock that while up this year during an economic downturn (mainly due to the litigation wins as opposed to their core business), this is a stock that is down almost 30% over the last 5 years. Their increased profits haven't been due to increased revenue, but lowered costs which is a trend that can't continue forever. They have stopped growing, this is a dead company.

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