DISH/TiVo: A Shot-Gun Solution?

The long-awaited US Court of Appeals decision on TiVo v. DISH/EchoStar came down split ... but with the scales weighted to TiVo.

The court gave DISH a victory by unanimously vacating the district court's contempt ruling on its software design workaround.  However, it gave TiVo the bigger victory in backing (by 7 to 5) the lower court finding that DISH is in contempt of the disablement provision.

That leaves DISH faced "with an imminent shut-down of millions of DVRs," noted Bernstein Research analyst Craig Moffett.  That, he posits, could leave the DBS operator with a "gun-to-the-head settlement requirement" which could run into the $3B range for disabling and replacing the infringing DVRs.  (No one really knows how many infringing DVRs there are and Charlie Ergen, quite naturally, isn't saying.)

Don't expect the DISH/EchoStar crew to give up easily, though.  They're now talking "stay of injunction," taking it all to the US Supreme Court and a "motion to dissolve the injunction."

So it's not over yet although the market made its judgment clear, boosting TiVo by nearly 30% to $10.86.

For his part, Citi's Jason Bazinet thinks "With today’s partial TiVo victory, the odds of an outright victory for Dish just got slimmer. However, given Dish’s push to swap out older MPEG4 boxes, coupled with it’s efforts to implement a new work-around, it seems clear the two parties are unlikely to reach a negotiated settlement."•

AT&T U-verse Adds 218K

AT&T appears to be doing just fine without iPhone exclusivity as its profits jumped 39% in the first quarter thanks partly to a big boost (+$1B) from mobile data.  The company did well with U-verse too, adding a net new 218K TV subs and 175K internet subs for the quarter.  U-verse finished the three month period with a total 3.2M video subscribers.

In other Q1 news, retrans revenues helped shore up Media General's 1Q11 with the total up 15.9% y/y to $5.34M. Overall the company reported an operating loss of $4.2M for 1Q v. a profit of $8.7M y/y.• 

Etc: Firing on Premium VOD – Comcast Reups NHL – More DISH Retrans

Battlegrounds:  Premium VOD is drawing more fire from Hollywood as 23 directors and producers are backing the National Assn. of Theater Owners in an attempt to get the studios to drop their Home Premiere plan, due to launch on DIRECTV today. ---iPad is handily winning the tablet wars, commanding 85% of the market last year, says ABI Research.

Programming:  In a deal rumored at $2B, Comcast retained US broadcast rights for NHL games for 10 years. Meanwhile, NBCU's Dick Ebersol said that Comcast's national sports net, Versus, will be rebranded.  Look for an "N" in the title.

Analyze This:  Apple posted a $6B profit in fiscal Q2 ... a 95% jump on strong sales across its product line ... 18.7M more iPhones and 4.7M more iPads means more bandwidth usage. --- Don't look for Google's Kansas City, KS experiment in gigabit speed internet to spread fast, say analysts from IHS iSuppli.  High costs, lack of competition among broadband providers and lack of consumer interest will leave the US mostly in the slow lane.

Retrans & Renewals:  DISH's deal with Journal Broadcast Group expires April 28 ... and the 13-station broadcaster says it's about to issue a warning about a possible blackout.

Get tomorrow's headlines today with The Evening BRIDGE ... every weekday, after the Bell.•