Post by dkennedy on Feb 25, 2005 6:51:01 GMT -5
TiVo stock rises 18% on rumors in market
Potential bid from Apple appears unlikely
Benjamin Pimentel, Chronicle Staff Writer
Thursday, February 24, 2005
TiVo Inc. shares rose more than 18 percent Wednesday, driven by speculation that Apple Computer Inc. might make a bid on the struggling digital video recorder firm.
But some analysts said such an acquisition seemed unlikely despite the Alviso company's slumping stock price.
Representatives for both companies said they don't comment on market rumors. Shares of TiVo, a pioneer in digital video recording technology, jumped 68 cents, or 18.38 percent, to $4.38 in Wednesday's regular trading.
Last week, TiVo said its subscriber base has passed the 3 million mark, adding about 698,000 in its last quarter, ended Jan. 31.
But despite its groundbreaking technology, TiVo has yet to post a profit. The company is also facing stiffer competition from cable operators, digital satellite TV companies and consumer electronics firms.
TiVo management is also going through a period of transition. TiVo President Marty Yudkovitz resigned three weeks ago for family reasons. Last month, company co-founder and Chief Executive Officer Mike Ramsay said he was stepping down.
Speculation that Apple might make a bid for TiVo is based on the Cupertino giant's push to become a bigger player in digital home entertainment.
But analyst Michael Gartenberg of Jupiter Research said such a deal is "extraordinarily unlikely."
"At this point, there is simply no reason for Apple to buy TiVo," said Gartenberg, who does not own TiVo or Apple stock.
He said Apple has enough in-house talent to develop its own digital recording technology.
"Apple's business is not based on a subscription model, so picking up the subscription base doesn't do anything for them," he added.
Analyst Shaw Wu of American Technology Research said he was also not convinced Apple would buy TiVo.
"I'm not sure it's the greatest fit for Apple," said Wu, who does not own either TiVo or Apple stock. "They have a great technology, no doubt, but a lot of people are looking to do it in-house."
With TiVo's ongoing problems, he added, it might also make sense for Apple or any other potential buyer to wait. "You can probably get it cheaper," he said. "At a lower price, it might be attractive."
E-mail Benjamin Pimentel at bpimentel@sfchronicle.com.
Potential bid from Apple appears unlikely
Benjamin Pimentel, Chronicle Staff Writer
Thursday, February 24, 2005
TiVo Inc. shares rose more than 18 percent Wednesday, driven by speculation that Apple Computer Inc. might make a bid on the struggling digital video recorder firm.
But some analysts said such an acquisition seemed unlikely despite the Alviso company's slumping stock price.
Representatives for both companies said they don't comment on market rumors. Shares of TiVo, a pioneer in digital video recording technology, jumped 68 cents, or 18.38 percent, to $4.38 in Wednesday's regular trading.
Last week, TiVo said its subscriber base has passed the 3 million mark, adding about 698,000 in its last quarter, ended Jan. 31.
But despite its groundbreaking technology, TiVo has yet to post a profit. The company is also facing stiffer competition from cable operators, digital satellite TV companies and consumer electronics firms.
TiVo management is also going through a period of transition. TiVo President Marty Yudkovitz resigned three weeks ago for family reasons. Last month, company co-founder and Chief Executive Officer Mike Ramsay said he was stepping down.
Speculation that Apple might make a bid for TiVo is based on the Cupertino giant's push to become a bigger player in digital home entertainment.
But analyst Michael Gartenberg of Jupiter Research said such a deal is "extraordinarily unlikely."
"At this point, there is simply no reason for Apple to buy TiVo," said Gartenberg, who does not own TiVo or Apple stock.
He said Apple has enough in-house talent to develop its own digital recording technology.
"Apple's business is not based on a subscription model, so picking up the subscription base doesn't do anything for them," he added.
Analyst Shaw Wu of American Technology Research said he was also not convinced Apple would buy TiVo.
"I'm not sure it's the greatest fit for Apple," said Wu, who does not own either TiVo or Apple stock. "They have a great technology, no doubt, but a lot of people are looking to do it in-house."
With TiVo's ongoing problems, he added, it might also make sense for Apple or any other potential buyer to wait. "You can probably get it cheaper," he said. "At a lower price, it might be attractive."
E-mail Benjamin Pimentel at bpimentel@sfchronicle.com.