TiVo Buying Content Discovery Service Digitalsmiths for $135 Million
TiVo announced today it would acquire Digitalsmiths, one of the leaders in cloud-based pay-TV content discovery and recommendations. TiVo will pay $135 million in cash for the service, and it expects that Digitalsmiths will begin attributing positively to its adjusted earnings before interest, taxes, depreciation, and amortization in the upcoming fiscal year.
"The Digitalsmiths acquisition opens new opportunities to commercialize and deploy TiVo's cloud based services and technologies to operators, in an extremely cost effective way that can be offered either independently or in conjunction with TiVo's renowned user interface," TiVo CEO and President Tom Rogers said in a press release.
The release notes that Digitalsmiths has relationship with seven of the top 10 pay-TV operators in the United States, and those relationships cover 64% of all pay-TV subscribers. While only 10% of those customers use the services that Digitalsmiths provides, that number is expected to move to 50% in coming years, according to TiVo.
Digitalsmiths Seamless Discovery product provides unique real-time personalized content recommendations that "drive higher consumer engagement and satisfaction, helping video service providers increase average revenue per customer and decrease customer churn," according to the press release.
Ben Weinberger, CEO and co-founder of Digitalsmiths, said in the press release that both Digitalsmiths and TiVo "share an acute focus to improve the consumers' viewing experience, and we understand the importance of the 'service' or 'cloud' to achieve this goal through next generation personalized video discovery solutions."
In addition to the acquisition of Digitalsmiths, TiVo also announced it has increased its stock repurchase plan by $100 million to $186 million. It noted that it plans to repurchase $100 million in shares during the first quarter of fiscal 2015, which begins this Saturday. The company also said it would provide further information about the Digitalsmiths transaction when it reports fourth-quarter fiscal 2014 results.
The article TiVo Buying Content Discovery Service Digitalsmiths for $135 Million originally appeared on Fool.com.Patrick Morris has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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