Backing AT&T, Microsoft Sues Tivo

Microsoft Corp. is backing AT&T Inc. in a patent lawsuit filed by TiVo Inc. against the phone company. Microsoft's tactic: Filing a lawsuit of its own against TiVo.

TiVo, the maker of digital video recorders, won a series of court victories over Dish Network Corp. for violating a patent on a technology that lets viewers pause and rewind live TV. Last August TiVo took the same fight to AT&T Inc. and Verizon Communications Inc., alleging that television services offered by those companies also violate this and two other TiVo patents.

Microsoft could be on the hook as well if AT&T loses its case. Microsoft's Mediaroom software is used in AT&T's set-top boxes that deliver TV under the brand U-verse.

So now Microsoft is trying to turn the tables. In a filing in a Northern California federal court on Tuesday, Microsoft accused TiVo of infringing on its patents on technologies that enable an on-screen TV guide and allow viewers to order and view shows on their televisions.

TiVo had no comment on the specifics of Microsoft's allegations but said the software company's lawsuit has no bearing on TiVo's suit against AT&T.

"We remain confident in our position that AT&T will be found to infringe on the TiVo patents asserted," the company said in a statement.

Microsoft spokesman Kevin Kutz said in a statement that the company is willing to settle the issue through a licensing agreement and has contacted TiVo for talks.

Tony Wible, an analyst at Janney Montgomery Scott, said TiVo stands to gain a windfall if it succeeds in collecting from every subscription-TV operator that infringes on its patent.

TiVo has been awarded more than $400 million in lawsuits against Dish, of which $305 million is under appeal. If it prevails in the AT&T case, any money awarded would be helpful to TiVo, a company that has struggled to make money as sales of its video recorders and subscription services have slowed.