'You've Got a Friend:' Shell Rolls Out New Kind of Deal

The new Gemstar [GMST] cut a kinder, gentler deal Tues, when it agreed to license its patents and technology to Time Warner Cable’s digital subs, a stark contrast to Gemstar’s previous strategy of protecting its patents. The deal means MSOs can begin to develop their own IPGs, as TW Cable is doing with planned network-based DVR service Mystro, or use Gemstar with alternative IPG products from other vendors. "They can do it in a way where they don’t have to work around the patents," Gemstar CEO Jeff Shell says. "We never once put a gun to their head…Now, we’re partners rather than adversaries." Shell doesn’t expect Time Warner Cable to roll out TV Guide’s IPG in its entirety or does he expect the MSO to roll out Mystro without any TV Guide involvement. "It’s not black-and-white. I expect something in the middle…It’s important for us to have Mystro include some of our content and tech as an element." The deal also seems to fit Time Warner’s modus operandi: deploying a bit of everything. Just as with set-tops, the MSO has built up an arsenal of IPG products, including S-A’s [SFA] Sara and Pioneer’s Passport. It’s also trialing Microsoft’s [MSFT] IPG. With vendors competing for deals with Time Warner, "this sort of thinking helps keep costs down and keeps quality high," TWC says.