TiVo (s TIVO) is going to get $215 million over the next seven years from AT&T (s T) thanks to a settlement of the two companies’ DVR lawsuit. TiVo had sued AT&T in 2009, alleging that the phone company’s DVR violated some of TiVo’s patents. AT&T has now agreed to pay TiVo $51 million up front, as well as a total of $164 million in quarterly payments. AT&T could be forced to pay up even more if its number of DVR subscribers went above a certain threshold, according to a news release issued by TiVo.
We’ve long been arguing that TiVo has been transforming itself from a CE player to a licensing entity. The company has been bleeding end-user subscribers for years, but recently was able to add subscriptions through partnerships with Virgin and RCN. Still, the only way TiVo has really made money in recent years was through patent lawsuits, followed by lucrative settlements. Dish Network (s DISH) and Echostar agreed to pay TiVo a total of $500 million to settle a lawsuit brought against their DVRs last year.
Image courtesy of TaxBrackets.org.