10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended July 31, 2006

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to             

Commission file number 000-27141

TIVO INC.

(Exact name of registrant as specified in its charter)

Delaware	77-0463167
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

2160 Gold Street, P.O. Box 2160, Alviso, CA 95002

(Address of principal executive offices including zip code)

(408) 519-9100

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.    YES  x    NO  ¨.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act).

Large Accelerated Filer  ¨            Accelerated Filer  x            Non-Accelerated Filer  ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    YES  ¨    NO  x.

The number of shares outstanding of the registrant’s common stock, $0.001 par value, was 87,289,901 as of August 30, 2006.

PART I	FINANCIAL INFORMATION	4
ITEM 1.	FINANCIAL STATEMENTS.	4
	CONDENSED CONSOLIDATED BALANCE SHEETS	4
	CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS	5
	CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT	6
	CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS	7
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.	25
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.	37
ITEM 4.	CONTROLS AND PROCEDURES.	38
PART II	OTHER INFORMATION	38
ITEM 1.	LEGAL PROCEEDINGS.	38
ITEM 1A.	RISK FACTORS.	39
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.	42
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES.	42
ITEM 4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.	42
ITEM 5.	OTHER INFORMATION.	42
ITEM 6.	EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.	44
SIGNATURES AND OFFICER CERTIFICATIONS		45

^©2006 TiVo Inc. All Rights Reserved.

Except as the context otherwise requires, the terms “TiVo,” “Registrant,” “company,” “we,” “us,” or “our” as used herein are references to TiVo Inc. and its consolidated subsidiaries.

2

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This quarterly report on Form 10-Q contains certain forward-looking statements within the meaning of section 27A of the Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934, as amended. These statements relate to, among other things:

• our future investments in subscription acquisition activities, including rebate offers to consumers, offers of bundled hardware and service subscriptions, advertising expenditures, and other marketing activities;

• our future earnings including expected future service, technology, and hardware revenues;

• possible future impact of our change in accounting policy regarding our bundled sales program;

• our financial results, and expectations for profitability in the future;

• possible future increases in our general and administrative expenses, including expenditures related to lawsuits involving us such as the EchoStar patent infringement cases;

• possible future increases in our operating expenses, including increases in customer support and retention expenditures;

• future subscription growth of both TiVo-Owned and third party service provider subscriptions (such as DIRECTV, Comcast, and Cox);

• our estimates of the useful life of TiVo-enabled DVRs in connection with the recognition of revenue received from product lifetime subscriptions;

• consumer rebate redemption rates and sales incentive programs;

• our intentions to continue to grow the number of TiVo-Owned subscriptions through our relationships with major retailers;

• our expectations related to future increases in advertising and audience measurement research revenues;

• our expectations related to changes in the cost of our hardware revenues and the reasons for changes in the volume of DVRs sold to retailers;

• our ability to fund operations, capital expenditures, and working capital needs during the next year; and

• our ability to raise additional capital through the financial markets in the future.

Forward-looking statements generally can be identified by the use of forward-looking terminology such as “believe,” “expect,” “may,” “will,” “intend,” “estimate,” “continue,” “ongoing,” “predict,” “potential,” and “anticipate” or similar expressions or the negative of those terms or expressions. These statements involve known and unknown risks, uncertainties and other factors, which may cause our actual results, performance or achievements to differ materially from those expressed or implied by such forward-looking statements. Such factors include, among others, the information contained under the caption Part II, Item 1A, “Risk Factors” in this quarterly report and contained under the caption Part I, Item 1A “Risk Factors” in our most recent annual report on Form 10-K. The reader is cautioned not to place undue reliance on these forward-looking statements, which reflect management’s analysis only as of the date of this quarterly report and we undertake no obligation to publicly update or revise any forward-looking statements in this quarterly report. The reader is strongly urged to read the information set forth under the caption Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operation” and Part II, Item 1A “Risk Factors” in this quarterly report and our quarterly report for the quarter ended April 30, 2006 and in Part I, Item 1A “Risk Factors” in our most recent annual report for a more detailed description of these significant risks and uncertainties.

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PART I FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

TIVO INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share amounts)

(unaudited)

	July 31, 2006			January 31, 2006
				Adjusted
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	60,518		$	85,298
Short-term investments		14,600			18,915
Accounts receivable, net of allowance for doubtful accounts of $48 and $56		18,288			20,111
Finished goods inventories		18,457			10,939
Prepaid expenses and other, current		3,683			8,744
Total current assets		115,546			144,007
LONG-TERM ASSETS
Property and equipment, net		9,911			9,448
Purchased technology, capitalized software, and intangible assets, net		6,107			5,206
Prepaid expenses and other, long-term		243			347
Total long-term assets		16,261			15,001
Total assets	$	131,807		$	159,008
LIABILITIES AND STOCKHOLDERS’ DEFICIT
LIABILITIES
CURRENT LIABILITIES
Accounts payable	$	25,303		$	24,050
Accrued liabilities		23,846			37,449
Deferred revenue, current		56,063			57,902
Total current liabilities		105,212			119,401
LONG-TERM LIABILITIES
Deferred revenue, long-term		56,768			67,575
Deferred rent and other		1,931			1,404
Total long-term liabilities		58,699			68,979
Total liabilities		163,911			188,380
COMMITMENTS AND CONTINGENCIES (see Note 9)
STOCKHOLDERS’ DEFICIT
Preferred stock, par value $0.001:
Authorized shares are 10,000,000;
Issued and outstanding shares - none		—			—
Common stock, par value $0.001:
Authorized shares are 150,000,000;
Issued and outstanding shares are 87,040,041 and 85,376,191, respectively		87			85
Additional paid-in capital		679,052			667,055
Deferred compensation		—			(2,421	)
Accumulated deficit		(711,243	)		(694,091	)
Total stockholders’ deficit		(32,104	)		(29,372	)
Total liabilities and stockholders’ deficit	$	131,807		$	159,008

The accompanying notes are an integral part of these condensed consolidated statements.

4

TIVO INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share and share amounts)

(unaudited)

	Three Months Ended July 31,						Six Months Ended July 31,
	2006			2005			2006			2005
				Adjusted						Adjusted
Revenues
Service and technology revenues	$	52,880		$	40,674		$	107,989		$	80,694
Hardware revenues		16,235			4,649			25,688			15,175
Rebates, revenue share, and other payments to channel		(9,948	)		(5,988	)		(17,998	)		(9,626	)
Net revenues		59,167			39,335			115,679			86,243
Cost of revenues
Cost of service and technology revenues (1)		12,629			7,458			30,430			16,324
Cost of hardware revenues		21,607			7,697			36,753			23,339
Total cost of revenues		34,236			15,155			67,183			39,663
Gross margin		24,931			24,180			48,496			46,580
Research and development (1)		12,891			9,778			25,752			20,682
Sales and marketing (1)		8,344			7,574			15,733			14,404
General and administrative (1)		11,091			8,409			26,150			14,547
Total operating expenses		32,326			25,761			67,635			49,633
Loss from operations		(7,395	)		(1,581	)		(19,139	)		(3,053	)
Interest income		988			734			2,050			1,358
Interest expense and other		(29	)		(2	)		(32	)		(3	)
Loss before income taxes		(6,436	)		(849	)		(17,121	)		(1,698	)
Provision for income taxes		(12	)		(43	)		(31	)		(51	)
Net loss	$	(6,448	)	$	(892	)	$	(17,152	)	$	(1,749	)
Net loss per common share - basic and diluted	$	(0.07	)	$	(0.01	)	$	(0.20	)	$	(0.02	)
Weighted average common shares used to calculate basic and diluted net loss per share		85,978,022			83,505,681			85,555,826			82,943,276
_________
(1)    Includes stock-based compensation expense (benefit) as follows :
Cost of service and technology revenues	$	373		$	—		$	670		$	—
Research and development		1,451			39			2,569			(125	)
Sales and marketing		450			(146	)		790			(40	)
General and administrative		1,289			48			2,621			48

The accompanying notes are an integral part of these condensed consolidated statements.

5

TIVO INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT

(In thousands, except share amounts)

(unaudited)

	Common Stock				Additional Paid-In Capital			Deferred Compensation			Accumulated Deficit			Total
	Shares		Amount
											Adjusted			Adjusted
BALANCE JANUARY 31, 2006	85,376,191		$	85	$	667,055		$	(2,421	)	$	(694,091	)	$	(29,372	)
Issuance of common stock upon exercise of common stock options	737,222			1		3,723			—			—			3,724
Issuance of restricted shares of common stock	69,040			—		259			—			—			259
Deferred compensation - reversal due to FAS 123R	—			—		(2,421	)		2,421			—			—
Recognition of stock based compensation expense, net	—			—		3,087			—			—			3,087
Net loss	—			—		—			—			(10,704	)		(10,704	)
BALANCE APRIL 30, 2006	86,182,453		$	86	$	671,703		$	—		$	(704,795	)	$	(33,006	)
Issuance of common stock upon exercise of common stock options	562,506			1		2,523			—			—			2,524
Issuance of common stock related to Employee Stock Purchase Plan	279,473			—		1,290			—			—			1,290
Issuance of restricted shares of common stock	20,000			—		—			—			—			—
Cancellation of restricted shares of common stock	(4,391	)		—		(27	)		—			—			(27	)
Recognition of stock based compensation expense, net	—			—		3,563			—			—			3,563
Net loss	—			—		—			—			(6,448	)		(6,448	)
BALANCE JULY 31, 2006	87,040,041		$	87	$	679,052		$	—		$	(711,243	)	$	(32,104	)

The accompanying notes are an integral part of these condensed consolidated statements.

6

TIVO INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(unaudited)

	Six Months Ended July 31,
	2006			2005
				Adjusted
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(17,152	)	$	(1,749	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization of property and equipment and intangibles		3,598			2,982
Recognition of stock-based compensation expense (benefit)		6,650			(117	)
Changes in assets and liabilities:
Accounts receivable, net		1,823			17,195
Finished goods inventories		(7,518	)		(8,373	)
Prepaid expenses and other		5,165			977
Accounts payable		878			(7,626	)
Accrued liabilities		(14,121	)		(12,975	)
Deferred revenue		(12,646	)		3,323
Deferred rent and other long-term liabilities		527			(214	)
Net cash used in operating activities	$	(32,796	)	$	(6,577	)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of short-term investments		(35	)		(5,375	)
Sales of short-term investments		4,350			9,825
Acquisition of property and equipment		(3,462	)		(2,568	)
Acquisition of capitalized software and intangibles		(375	)		(3,915	)
Net cash used in investing activities	$	478		$	(2,033	)
CASH FLOWS FROM FINANCING ACTIVITIES
Borrowing under bank line of credit		—			8,000
Payments to bank line of credit		—			(4,500	)
Proceeds from issuance of common stock related to exercise of common stock options		6,248			5,863
Proceeds from issuance of common stock related to employee stock purchase plan		1,290			1,175
Net cash provided by financing activities	$	7,538		$	10,538
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	$	(24,780	)	$	1,928

The accompanying notes are an integral part of these condensed consolidated statements.

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TIVO INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

(In thousands)

(unaudited)

	Six Months Ended July 31,
	2006		2005
			Adjusted
CASH AND CASH EQUIVALENTS:
Balance at beginning of period		85,298		87,245
Balance at end of period	$	60,518	$	89,173
SUPPLEMENTAL DISCLOSURE OF CASH AND NON-CASH FLOW INFORMATION
Cash paid for interest	$	3	$	3
Cash paid for income taxes		31		13
SUPPLEMENTAL DISCLOSURE OF OTHER NON-CASH INVESTING AND FINANCING INFORMATION
Adjustment to deferred compensation as a result of retirement due to forfeiture of unvested restricted common stock		—		560
Issuance of restricted common stock		232		2,282

The accompanying notes are an integral part of these condensed consolidated statements.

8

TIVO INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. NATURE OF OPERATIONS

TiVo Inc. (the “Company” or “TiVo”) was incorporated in August 1997 as a Delaware corporation and is located in Alviso, California. On August 21, 2000, TiVo (UK) Limited, a wholly owned subsidiary of TiVo Inc., was incorporated in the United Kingdom. On October 9, 2001, the Company formed a subsidiary, TiVo International, Inc., also a Delaware corporation. On July 16, 2004, TiVo Intl. II, Inc., a wholly owned subsidiary of TiVo Inc., was incorporated in the Cayman Islands. On March 22, 2005, TiVo Brands LLC, a wholly owned subsidiary of TiVo Inc., was incorporated in the State of Delaware as a holding entity for all of the Company’s trademarks. The Company conducts its operations through one reportable segment. TiVo is a provider of technology and services for digital video recorders (DVRs). The subscription-based TiVo service (the “TiVo service”) improves home entertainment by providing consumers with an easy way to record, watch, and control television. TiVo also provides a unique platform for the television industry, including for advertisers and audience research.

The Company continues to be subject to a number of risks, including delays in product and service developments; competitive service offerings; lack of market acceptance and uncertainty of future profitability; the dependence on third parties for manufacturing, marketing, and sales support; the intellectual property claims against the Company; and dependence on its relationships with DIRECTV, Comcast, and Cox for subscription growth. The Company anticipates that its business will continue to be seasonal and expects to generate a significant number of its annual new subscriptions during and immediately after the holiday shopping season.

Unaudited Interim Condensed Consolidated Financial Statements

The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles (GAAP) for interim financial information, the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the unaudited interim condensed consolidated financial statements do not contain all of the information and footnotes required by generally accepted accounting principles for complete audited annual financial statements. In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting only of normal recurring adjustments, necessary for the fair presentation of the Company’s financial position as of July 31, 2006 and January 31, 2006 and the results of operations for the three and six-month periods ended July 31, 2006 and 2005 and condensed consolidated statements of cash flows for the six-month periods ended July 31, 2006 and 2005. Additionally, included is the unaudited statement of stockholders’ deficit for the three month periods ended April 30, 2006 and July 31, 2006. These condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements as of January 31, 2006 and 2005, including the notes thereto, included in the Company’s 2006 Annual Report on Form 10-K as updated by the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on July 21, 2006. Operating results for the three and six-month periods ended July 31, 2006 are not necessarily indicative of results that may be expected for the fiscal year ending January 31, 2007.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Revenue Recognition and Deferred Revenue

The Company generates service revenues from fees for providing the TiVo service to consumers and through the sale of advertising and audience measurement research services. The Company also generates technology revenues from providing licensing and engineering services. In addition, the Company generates hardware revenues from the sale of hardware products that enable the TiVo service.

Service Revenues. Included in service revenues are revenues from recurring and prepaid subscription plans to the TiVo service and fees received from the sale of advertising and audience measurement research services. Monthly and prepaid fixed-length subscription revenues are recognized over the period benefited. Subscription revenues from product lifetime subscriptions are recognized ratably over a four-year period, which is the Company’s estimate of the useful life of a TiVo-enabled DVR. Also included in service revenues are fees received from third parties, such as DIRECTV, which are recognized as earned.

Technology Revenues. The Company recognizes technology revenues under technology license and engineering services agreements in accordance with the SOP 97-2, “Software Revenue Recognition,” as amended. These agreements contain multiple-elements in which vendor specific objective evidence (“VSOE”) of fair value is required for all undelivered elements in order to recognize revenue related to the delivered element. Elements included in the Company’s arrangements may include technology licenses and associated maintenance and support, engineering services and other services. The timing of revenue recognition related to these transactions will depend, in part, on whether the Company can establish VSOE for undelivered elements and on how these transactions are structured. As such, revenue recognition may not correspond to the timing of related cash flows or the Company’s work effort.

In arrangements which include engineering services that are essential to the functionality of the software or involve significant customization or modification of the software, the Company recognizes revenue using the percentage-of-completion

9

method, as described in SOP 81-1 “Accounting for Performance of Construction-Type and Certain Production-Type Contracts,” if the Company believes it is able to make reasonably dependable estimates of the extent of progress toward completion. The Company measures progress toward completion based on the ratio of costs incurred, principally labor, to date to total estimated costs of the project, an input method. These estimates are assessed continually during the term of the contract, and revisions are reflected when the changed conditions become known. In some cases, the Company accepted engineering services contracts that were expected to be losses at the time of acceptance in order to gain experience in developing new technology that could be used in future products and services. Provisions for all losses on contracts are recorded when estimates indicate that a loss will be incurred on a contract. In some cases, it may not be possible to separate the various elements within the arrangement due to a lack of fair value for undelivered elements in the contract. In these situations, the Company recognizes revenues and costs based on a zero profit model, which results in the recognition of equal amounts of revenues and costs, until the engineering professional services are complete. Thereafter, any remaining revenue is recognized over the period of the maintenance and support or other services that are provided.

Hardware Revenues. For product sales to distributors, revenues are recognized upon product shipment to the distributors or receipt of the products by the distributor, depending on the shipping terms, provided that all fees are fixed or determinable, evidence of an arrangement exists and collectibility is probable. End users have the right to return their product within 30 days of the purchase. TiVo establishes allowances for expected product returns in accordance with SFAS No. 48, “Revenue Recognition When Right of Return Exists”. These allowances are recorded as a direct reduction of revenues and accounts receivable. For direct product sales to end-users prior to March 15, 2006, hardware revenues were recognized upon shipment by TiVo to the end-users provided all appropriate revenue recognition criteria were met. After March 15, 2006, the Company stopped selling DVRs directly to end-users on a standalone basis – see Bundled Sales Programs.

Bundled Sales Programs. Prior to March 15, 2006, the Company sold DVRs directly to end-users for no cost or at a substantial discount when bundled with a prepaid subscription contract under certain marketing or promotion programs. These were considered multiple element arrangements, which met the requirements for separation under Emerging Issues Task Force (EITF) 00-21, “Revenue Arrangements with Multiple Deliverables.” The prepaid fee was allocated to the hardware and service based on their relative fair values and recognized in accordance with the respective accounting policies stated above.

Beginning on March 15, 2006, the Company began selling the DVR and service directly to end-users solely through bundled sales programs through the TiVo website. Under these bundled programs, the customer receives a DVR and commits to a minimum subscription of one to three years. Unlike the bundled sales programs offered prior to March 15, 2006, the customer receives the DVR with no upfront payment and has the option to either pay a monthly fee over the subscription term (monthly program) or to prepay the subscription fee in advance (prepaid program). After the initial committed subscription term, the customer has various pricing options at which they can renew the subscription. During the quarter ended April 30, 2006, these bundled sale programs did not meet the requirements for separation under EITF 00-21. As a result, for both the monthly and prepaid programs, the entire arrangement fee was recognized ratably over the subscription period and was classified as Service Revenue in the condensed consolidated statements of operations. However, during the second quarter ended July 31, 2006, certain bundled sales programs have met the requirements for separation under EITF 00-21 since TiVo now has sufficient data to support fair value for the subscription element in the arrangement. As a result, for these certain prepaid programs, revenue is now allocated to the DVR and subscription based on the residual value method, with the DVR revenue recognized upon delivery and the subscription revenue being recognized over the term of the service commitment.

For the monthly programs introduced on March 15, 2006, the Company concluded it was appropriate to charge the related hardware costs to cost of hardware revenues upon shipment of the DVR. Effective February 1, 2006, the Company changed its accounting policy for the recognition of DVR costs for prepaid bundled sales arrangements to charge the entire cost of the hardware to cost of revenues upon shipment. Previously, the Company deferred the portion of the hardware costs exceeding the recognized revenue allocated to the hardware element and amortized such costs over the period of the subscription. See Change in Accounting Policy section below.

Rebates, Revenue Share, and Other Payments to Channel. In accordance with EITF 01-09, “Accounting for Consideration Given by a Vendor to a Customer (Including a Reseller of the Vendors Products)”, certain payments to retailers and distributors such as market development funds and revenue share are shown as a reduction to revenue rather than as a sales and marketing expense. TiVo’s policy is to reduce revenue when these payments are incurred and fixed or determinable. The Company also records rebates offered to consumers as a reduction to revenue. The Company records a liability for estimated future rebate redemption at the later of the delivery of the hardware or announcement of the rebate program.

Deferred Revenues. Deferred revenues consists of unrecognized service and technology fees that have been collected, but the related service has not yet been provided or VSOE of fair value does not exist for the undelivered elements of an arrangement.

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Change in Accounting Policy

Recognition of Hardware Costs and Bundled Sales Programs

Effective February 1, 2006, the Company changed its method of accounting for the recognition of hardware costs in bundled sales programs where the customer prepays the arrangement fee. Previously, to the extent that the cost of the DVR exceeded the revenue allocated to the DVR, the excess costs were deferred and amortized over the period of the subscription. In this prepayment plan, the Company received the cash upfront from consumers, which allowed the Company to elect deferral of hardware costs over the service period. The Company now expenses all hardware costs upon shipment of the DVR (direct expense method).

The Company determined that the direct expense method was preferable to the prior accounting method because the Company believes: it is consistent with the accounting practices of competitors and companies within similar industries; it adds to the clarity and ease of understanding of the Company’s reported results to investors; and it is consistent with the recognition of hardware costs for bundled monthly sales programs. The Company recorded the change in method of accounting in accordance with Statement of Financial Accounting Standards (SFAS) No. 154, “Accounting Changes and Error Corrections.” SFAS 154 requires that all elective accounting changes be made on a retrospective basis. On July 21, 2006, the Company filed a current report on Form 8-K to set forth audited consolidated financial statements for the year ended January 31, 2006, which reflects the Company’s change in accounting policy with respect to its recognition of hardware costs in its bundled sales programs as previously disclosed in TiVo’s quarterly report on Form 10-Q for the quarter ended April 30, 2006, as filed with the SEC on June 9, 2006.

Stock-Based Compensation

The Company has stock option plans and an Employee Stock Purchase Plan (“ESPP”), under which officers, employees, consultants, and non-employee directors may be granted options to purchase shares of the Company’s authorized but unissued or reacquired common stock, and may also be granted restricted stock and other stock awards. Currently, the Company grants options from the 1) 1999 Equity Incentive Plan, under which options can be granted to all employees, including executive officers and 2) the 1999 Non-Employee Directors’ Stock Option Plan, under which options are granted automatically to non-employee directors. In addition, TiVo’s stock option program includes the 1997 Equity Incentive Plan, from which the Company currently does not grant options, but may do so. Upon the exercise of options, the Company issues new common stock from its authorized shares.

On February 1, 2006, the Company adopted the provisions of SFAS 123R, Shared-Based Payment, requiring TiVo to recognize expense related to the fair value of the Company’s stock-based compensation awards. SFAS No. 123R eliminates the ability to account for stock-based compensation transactions using the intrinsic value method under Accounting Principle Board (APB) Opinion No. 25, Accounting for Stock Issued to Employees, and instead requires that such transactions be accounted for using a fair-value based method. The fair value of TiVo’s restricted stock awards was calculated based on the fair market value of the Company’s stock at the grant date. The fair value of TiVo’s stock options and ESPP awards was estimated using a Black-Scholes option valuation model. This model requires the input of highly subjective assumptions and elections in adopting and implementing SFAS No. 123R, including expected stock price volatility and the estimated life of each award.

TiVo has elected to use the modified prospective transition method as permitted by SFAS 123R and therefore have not restated the Company’s financial results for prior periods. Under this transition method, stock-based compensation expense for the three and six months ended July 31, 2006 includes compensation expense for all stock-based compensation awards granted prior to, but not yet vested as of February 1, 2006, based on the grant date fair value estimated in accordance with the original provisions of SFAS 123. Stock-based compensation expense for all stock-based compensation awards granted subsequent to February 1, 2006 was based on the grant-date fair value estimated in accordance with the provisions of SFAS 123R. TiVo recognizes compensation expense for stock option awards on a straight-line basis over the requisite service period of the award.

Basis of Presentation

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All inter-company accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions. Actual results could differ from those estimates.

Property and Equipment

Property and equipment are stated at cost. Maintenance and repair expenditures are expensed as incurred.

Depreciation is computed using the straight-line method over estimated useful lives as follows:

Furniture and fixture	3-5 years
Computer and office equipment	3-5 years
Lab equipment	3 years
Leasehold improvements	The shorter of 4 years or the life of the lease
Capitalized software for internal use	1-5 years

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Advertising Costs

The Company expenses advertising costs as the services are provided. Advertising expenses were $1.7 million and $3.7 million for the three and six months ended July 31, 2006, respectively and $1.8 million and $2.8 million for the three and six months ended July 31, 2005, respectively.

Comprehensive Loss

The Company has no material components of other comprehensive income or loss and, accordingly, the comprehensive loss is the same as the net loss for all periods presented.

Business Concentrations and Credit Risk

Financial instruments that potentially subject the Company to a concentration of credit risk principally consist of cash, cash equivalents, short-term investments, and trade receivables. The Company currently invests the majority of its cash in money market funds and maintains them with several financial institutions with high credit ratings. The Company also invests in debt instruments of the U.S. government and its agencies and corporate issuers with high credit ratings. As part of its cash management process, the Company performs periodic evaluations of the relative credit ratings of these financial institutions. The Company has not experienced any credit losses on its cash, cash equivalents, or short-term investments.

The majority of the Company’s customers for service revenues are concentrated in the United States. The Company is subject to a minimal amount of credit risk related to these customers as service revenue is primarily obtained through credit card sales. DIRECTV represented approximately 12% and 15% of net revenues and 26% and 46% of net accounts receivable for the six months ended July 31, 2006 and 2005, respectively. The Company sells its TiVo-enabled DVR to retailers under customary credit terms. One retailer generated 6% and 5% of the Company’s net revenues and 18% and 5% of the net accounts receivable for the six months ended July 31, 2006 and 2005, respectively. Comcast represented approximately 9% of net revenues for the six months ended July 31, 2006.

The Company evaluates its outstanding accounts receivable each period for collectibility. This evaluation involves assessing the aging of the amounts due to the Company and reviewing the credit-worthiness of each customer. Based on this evaluation, the Company records an allowance for accounts receivable that are estimated to not be collectible.

The Company is dependent on single suppliers for several key components and services. The Company has an agreement with Tribune Media Services, its sole supplier of programming guide data for the TiVo service. Except for Tribune Media Services, the Company does not have contracts or arrangements with its single suppliers. Instead, the Company purchases these components and services by submitting purchase orders with these companies. If these suppliers fail to perform their obligations, the Company may be unable to find alternative suppliers or deliver its products and services to its customers on time, if at all.

Recent Accounting Pronouncements

In June 2006, the Financial Accounting Standards Board (FASB) issued FASB Interpretation Number 48 (FIN 48), “Accounting for Uncertainty in Income Taxes—an interpretation of FASB Statement No. 109.” The interpretation contains a two-step approach to recognizing and measuring uncertain tax positions accounted for in accordance with SFAS No. 109. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount which is more than 50% likely of being realized upon ultimate settlement. FIN 48 is effective for fiscal years beginning after December 15, 2006, which will be the Company’s fiscal year 2008, and is required to be recognized as a change in accounting principle through a cumulative-effect adjustment to retained earnings as of the beginning of the year of adoption. At this time, the Company believes there will be no impact on its consolidated financial statements.

In June 2006, the FASB ratified the provisions of Emerging Issues Task Force (“EITF”) Issue No. 06-3, “How Taxes Collected from Customers and Remitted to Governmental Authorities Should Be Presented in the Income Statement (That Is, Gross versus Net Presentation).” EITF Issue No. 06-3 requires that the presentation of taxes within revenue-producing transactions between a seller and a customer, including but not limited to sales, use, value added, and some excise taxes, should be on either a gross (included in revenue and cost) or a net (excluded from revenue) basis. In addition, for any such taxes that are reported on a gross basis, a company should disclose the amounts of those taxes in interim and annual financial statements for each period for which an income statement is presented if those amounts are significant. The disclosure of those taxes can be done on an aggregate basis. EITF Issue No. 06-3 is effective for fiscal years beginning after December 15, 2006, which will be the Company’s fiscal year 2008. EITF 06-3 will not impact the method for recording these sales taxes in the Company’s consolidated financial statements as the Company has historically presented sales excluding all taxes and the Company currently has no plan to change its method of revenue reporting.

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3. EQUITY INCENTIVE PLANS

1997 Equity Incentive Plan

Under the terms of the Company’s 1997 Equity Incentive Plan, adopted in 1997 and amended and restated in 1999 (the “1997 Plan”), options to purchase shares of the Company’s common stock may be granted to employees and other individuals at a price equal to the fair market value of the common stock at the date of grant. The options granted to new hires typically vest 25% after the first year of service, and the remaining 75% vest ratably over the next 36 months. The vesting periods for options granted to continuing employees vary, but typically vest monthly over a 48 month period. Options expire 10 years after the grant date, based on continued service. If the optionee’s service terminates, options expire 90 days from the date of termination except under certain circumstances such as death or disability. The terms of the 1997 Plan allowed individuals to exercise options prior to full vesting. In the event that the individual terminates his or her service to the Company before becoming fully vested, the Company has the right to repurchase the unvested shares at the original option price. The number of shares authorized for option grants under the 1997 Plan is 4,000,000. As of July 31, 2006, 475,430 shares of the total authorized remain available for future grants.

1999 Equity Incentive Plan

In April 1999, the Company’s stockholders approved the 1999 Equity Incentive Plan (the “1999 Plan”). Amendments to the 1999 Plan were adopted in July 1999. The 1999 Plan allows the grant of options to purchase shares of the Company’s common stock to employees and other individuals at a price equal to the fair market value of the common stock at the date of grant. The options granted to new employees typically vest 25% after the first year of service, and the remaining 75% vest monthly over the next 36 months. The vesting period for options granted to continuing employees may vary, but typically vest monthly over a 48 month period. Options expire 10 years after the grant date, based on continued service. If the optionee’s service terminates, options expire 90 days from the date of termination except under certain circumstances such as death or disability. The terms of the 1999 Plan allow individuals to early exercise options granted prior to August 8, 2001 from the date of grant, prior to full vesting. For options granted subsequent to August 8, 2001, options are exercisable only as the options vest. In the event that the individual terminates his or her service to the Company before becoming fully vested, the Company has the right to repurchase any exercised, unvested shares at the original option price. As of July 31, 2006, the number of shares authorized for option grants under the 1999 Plan is 38,363,130. The number of shares authorized for option grants is subject to an annual increase of the greater of 7% of outstanding shares or 4,000,000 shares, up to a maximum of 40,000,000 shares. As of July 31, 2006, 14,445,546 shares of the total authorized remain available for future stock option grants.

1999 Non-Employee Directors’ Stock Option Plan

In July 1999, the Company adopted the 1999 Non-Employee Directors’ Stock Option Plan (the “Directors’ Plan”). The Directors’ Plan provides for the automatic grant of options to purchase shares of the Company’s common stock to non-employee directors at a price equal to the fair market value of the stock at the date of the grant. Initial options granted to new directors vest monthly over two years from the date of grant. Annual options granted to existing directors vest upon grant. The option term is ten years after the grant date, based on continued director service. If the director’s service terminates, options expire 90 days from the date the director’s service terminated. The number of shares authorized for option grants under the Directors’ Plan is 1,200,000, subject to an annual increase of 100,000 shares. As of July 31, 2006, 618,333 shares of the total authorized remain available for future grants.

1999 Employee Stock Purchase Plan

In July 1999, the Company adopted the 1999 Employee Stock Purchase Plan (the “Employee Stock Purchase Plan”). The Employee Stock Purchase Plan provides a means for employees to purchase TiVo common stock through payroll deductions of up to 15% of their base compensation. The Company offers the common stock purchase rights to eligible employees, generally all full-time employees who have been employed for at least 10 days. This plan allows for common stock purchase rights to be granted to employees of TiVo at a price equal to the lower of 85% of the fair market value on the first day of the offering or on the common stock purchase date. This plan has also incorporated a one-year look back feature in its provisions except for the offering period from February 1, 2006 through June 30, 2006 which had a look back of five months. Each offering consists of up to two purchase periods. The purchase periods previously began on May 1 and on November 1 of each year, and now begin on January 1 and on July 1 of each year, and are six months in length. Under the Employee Stock Purchase Plan, the board may, in the future, specify offerings up to 27 months. On August 15, 2002, the board amended the 1999 Employee Stock Purchase Plan to change the effective date for automatic annual increases to the reserve of shares issuable under the plan from December 31 to October 31. Effective October 31, 2002, the board approved the maximum annual increase of 500,000 shares to the total number of shares reserved for issuance under the Employee Stock Purchase Plan pursuant to the plan’s automatic annual increase provision. As of July 31, 2006, the total number of shares reserved for issuance under this plan is 3,000,000. The number of shares available for stock issuance under this plan is subject to an annual increase on each October 31 through October 31, 2008, equal to the lowest of (i) 5 percent of the outstanding shares of common stock on a diluted basis, (ii) 500,000 shares, or (iii) a smaller number as determined by the board of directors. As of July 31, 2006, of the total 3,000,000 shares reserved for issuance under the Employee Stock Purchase Plan, there were 328,118 shares available for future purchases.

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Stock Award Activity

A summary of the stock options activity and related information for the six months ended July 31, 2006 is as follows:

	Shares		Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term	Aggregate Intrinsic Value
	(in thousands)					(in thousands)
Outstanding at January 31, 2006	16,791		$	7.16
Grants	4,006			6.79
Exercises	(1,300	)		4.81
Forfeitures or expirations	(1,030	)		7.73
Outstanding at July 31, 2006	18,467		$	7.21	7.52	$	15,664
Exercisable at July 31, 2006	8,393		$	7.99	6.06	$	7,796

The aggregate intrinsic value in the preceding table represents the total pretax intrinsic value, based on options with an exercise price less than the Company’s closing stock price of $6.73 as of July 31, 2006, which would have been received by the option holders had those option holders exercised their options as of that date. Total intrinsic value of options exercised was $1.3 million and $3.4 million for the three and six months ended July 31, 2006, respectively, and $1.9 million and $2.7 million for the three and six months ended July 31, 2005, respectively.

As of July 31, 2006, $34.0 million of total unrecognized compensation cost related to stock options is expected to be recognized over a weighted-average period of 3.12 years.

Options outstanding that have vested and are expected to vest as of July 31, 2006 are as follows:

	Shares	Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term	Aggregate Intrinsic Value
	(in thousands)				(in thousands)
Vested	8,393	$	7.99	6.06	$	7,796
Expected to vest	8,760	$	6.63	8.69	$	6,860
Total	17,153	$	7.30	7.40	$	14,656

Options outstanding that are expected to vest are net of estimated future option forfeitures in accordance with the provisions of SFAS No. 123R, which are estimated when compensation costs are recognized.

Unvested Stock

The Company had 467,412 restricted stock awards outstanding as of July 31, 2006, which were excluded from the options outstanding balances in the preceding tables. The total weighted-average grant date fair value was $2.7 million. Aggregate intrinsic value of restricted stock awards at July 31, 2006 was $3.2 million based on the Company’s closing stock price on July 31, 2006. Approximately 87,000 and 97,000 of the previously granted restricted stock awards vested during the three and six months ended July 31, 2006, respectively, and 4,000 and 9,000 during the three and six months ended July 31, 2005, respectively. The grant of these restricted stock awards has been deducted from the shares available for grant under the Company’s stock option plans. The total fair value of restricted stock awards vested was $571,000 and $641,000 for the three and six months ended July 31, 2006, respectively, and approximately $46,000 and $92,000 for three and six months ended July 31, 2005, respectively.

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The following table summarizes the Company’s unvested stock activity for the six months ended July 31, 2006 (shares in thousands):

	Shares		Weighted Average Grant Date Value
	(in thousands)
Unvested at January 31, 2006	480		$	6.11
Granted	89			6.85
Vested	(97	)		6.59
Forfeited	(4	)		6.71
Unvested stock at July 31, 2006	468		$	6.15

As of July 31, 2006, $2.2 million of total unrecognized compensation costs related to unvested restricted stock is expected to be recognized over a weighted-average period of 1.86 years.

4. STOCK-BASED COMPENSATION PLANS

Total stock-based compensation recognized on the unaudited condensed consolidated statements of operations for the three and six months ended July 31, 2006 is as follows:

	Three Months Ended July 31, 2006
	SARs/Option Grants and Stock Purchase Rights		Restricted Stock Purchase
	(In thousands)
Cost of revenues	$	373	$	—
Research and development		1,345		105
Sales and marketing		355		95
General and administrative		1,066		223
Stock-based compensation effect before income taxes	$	3,139	$	423
Income tax benefit		—		—
Total stock-based compensation effects in net income	$	3,139	$	423

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	Six Months Ended July 31, 2006
	SARs/Option Grants and Stock Purchase Rights		Restricted Stock Purchase
	(In thousands)
Cost of revenues	$	670	$	—
Research and development		2,404		165
Sales and marketing		612		178
General and administrative		2,193		428
Stock-based compensation effect before income taxes	$	5,879	$	771
Income tax benefit		—		—
Total stock-based compensation effects in net income	$	5,879	$	771

The adoption of SFAS No. 123R resulted in an additional loss of $.04 and $.07 per share for the three and six month periods ending July 31, 2006, as a result of the recognition of expense for stock options and ESPP shares.

Stock-based compensation costs were not capitalized as part of the cost of an asset as of July 31, 2006.

Net cash proceeds from the exercise of stock options were $2.5 million and $6.2 million for the three and six months ended July 31, 2006, respectively, and $4.5 million and $5.9 million for three and six months ended July 31, 2005, respectively.

In accordance with SFAS 123R, the Company presents excess tax benefits from the exercise of stock options, if any, as financing cash flows rather than operating cash flows. No income tax benefit was realized from stock option exercises during the three and six months ended July 31, 2006 and July 31, 2005, respectively.

Pro forma information required under SFAS No. 123R for periods prior to fiscal 2007 as if the Company had applied the fair value recognition provisions of SFAS No. 123 to options granted under the Company’s equity incentive plans, was as follows:

	Three Months Ended July 31, 2005			Six Months Ended July 31, 2005
	(In thousands, except per share data)
Net loss, as adjusted	$	(892	)	$	(1,749	)
Add back: stock based compensation benefit recognized, net of related tax effects		(59	)		(117	)
Pro forma effect of stock based compensation expense determined under the fair value method for all awards, net of related tax effects		(2,497	)		(4,833	)
Net loss, proforma	$	(3,448	)	$	(6,699	)
Basic and diluted loss per shares, as reported	$	(0.01	)	$	(0.02	)
Basic and diluted loss per shares, as proforma	$	(0.04	)	$	(0.08	)

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SFAS No. 123R requires the use of a valuation model to calculate the fair value of stock-based awards. The Company has elected to use the Black-Scholes option-pricing model, which incorporates various assumptions including volatility, expected life, and interest rate. The expected volatility is based on a combination of historical volatility of the Company’s common stock and implied volatility in market traded options on the Company’s common stock. The expected life of an award is based on the simplified calculation of expected life pursuant to Staff Accounting Bulletin No. 107 “Share Based Payments”. The interest rate for periods is based on the average of U.S. Treasury yield curve for the expected life of the award during the three and six months ended July 31, 2006.

The assumptions used for the three and six months ended July 31, 2006 and July 31, 2005, respectively, and the resulting estimates of weighted-average fair value per share of options and ESPP shares granted during those periods are as follows:

	Stock Options
	Three Months Ended						Six Months Ended
	July 31, 2006			July 31, 2005			July 31, 2006			July 31, 2005
Expected life (in years)		6.25			4.00			6.25			4.00
Interest rate		5.07	%		3.86	%		4.85	%		3.67	%
Volatility		80.91	%		55.00	%		84.78	%		61.00	%
Dividend yield		—			—			—			—
Weighted-average fair value of grants during the period	$	5.14		$	3.02		$	5.14		$	2.41
	ESPP
	Three Months Ended						Six Months Ended
	July 31, 2006			July 31, 2005			July 31, 2006			July 31, 2005
Expected life (in years)		0.63			0.50			0.53			0.50
Interest rate		5.15	%		3.28	%		4.97	%		3.16	%
Volatility		59.80	%		55.00	%		59.80	%		60.00	%
Dividend yield		—			—			—			—
Weighted-average fair value of grants during the period	$	2.39		$	1.71		$	2.06		$	2.14

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5. PROPERTY AND EQUIPMENT, NET

Property and equipment, net consists of the following:

	July 31, 2006			January 31, 2006
	(In thousands)
Furniture and fixtures	$	3,303		$	3,285
Computer and office equipment		22,245			20,946
Lab equipment		2,578			2,392
Leasehold improvements		7,190			6,319
Capitalized software		11,011			9,926
Total property and equipment		46,327			42,868
Less: accumulated depreciation and amortization		(36,416	)		(33,420	)
Property and equipment, net	$	9,911		$	9,448

6. PURCHASED TECHNOLOGY, CAPITALIZED SOFTWARE, AND INTANGIBLE ASSETS, NET

Purchased technology, capitalized software, and intangible assets, net consists of the following:

	July 31, 2006			January 31, 2006
	(In thousands)
Purchased technology	$	1,500		$	—
Capitalized software		1,951			1,951
Intellectual property rights		4,265			4,265
Purchased technology, capitalized software, and intangible assets, gross		7,716			6,216
Less: accumulated amortization		(1,609	)		(1,010	)
Purchased technology, capitalized software, and intangible assets, net	$	6,107		$	5,206

The total expected future annual amortization expense related to purchased technology, capitalized software, and intangible assets is calculated on a straight-line basis, using the useful lives of the assets, which range from three to five years for purchased technology and capitalized software and five to seven years for intellectual property rights. Estimated annual amortization expense is set forth in the table below:

Fiscal Year Ending	Estimated Annual Amortization Expense
	(In thousands)
January 31, 2007 (6 months)	$	766
January 31, 2008		1,533
January 31, 2009		1,500
January 31, 2010		1,097
January 31, 2011		559
January 31, 2012		559
There after		93
Total	$	6,107

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7. INDEMNIFICATION ARRANGEMENTS AND GUARANTEES

Product Warranties

The Company’s minimum warranty period to consumers for TiVo-enabled DVRs is 90 days from the date of consumer purchase also known as the Limited Warranty. For products purchased under the Bundled Sales Programs, the Company extends the Limited Warranty for the duration of the customer’s commitment. Within the limited warranty period, consumers are offered a no-charge exchange for TiVo-enabled DVRs returned due to product defect, within 90 days from the date of consumer purchase. Thereafter, consumers may exchange a TiVo-enabled DVR with a product defect for a charge. At July 31, 2006 and 2005, the accrued warranty reserve was $243,000 and $709,000, respectively. The Company’s accrued warranty reserve is included in accrued liabilities in the accompanying unaudited condensed consolidated balance sheets.

Indemnification Arrangements

The Company undertakes indemnification obligations in its ordinary course of business in connection with, among other things, the licensing of its products, the provision of consulting services, and the issuance of securities. Pursuant to these agreements, the Company may indemnify the other party for certain losses suffered or incurred by the indemnified party, generally its business partners or customers, underwriters or certain investors, in connection with various types of claims, which may include, without limitation, intellectual property infringement, advertising and consumer disclosure laws, certain tax liabilities, negligence and intentional acts in the performance of services and violations of laws, including certain violations of securities laws. The term of these indemnification obligations is generally perpetual. The Company’s obligation to provide indemnification would arise in the event that a third party filed a claim against one of the parties that was covered by the Company’s indemnification obligation. As an example, if a third party sued a customer for intellectual property infringement and the Company agreed to indemnify that customer against such claims, its obligation would be triggered.

The Company is unable to estimate with any reasonable accuracy the liability that may be incurred pursuant to its indemnification obligations. A few of the variables affecting any such assessment include but are not limited to: the nature of the claim asserted; the relative merits of the claim; the financial ability of the party suing the indemnified party to engage in protracted litigation; the number of parties seeking indemnification; the nature and amount of damages claimed by the party suing the indemnified party; and the willingness of such party to engage in settlement negotiations. During the period of calendar year 2002 through 2005, the Company incurred legal fees in the amount of $5.9 million in connection with the indemnification and defense of a claim against one of its manufacturers. However, that indemnification obligation was not typical of the Company’s indemnity liability and does not necessarily provide a reasonable measure of liability that may be expected to be incurred pursuant to its indemnification obligations. Due to the nature of the Company’s potential indemnity liability, its indemnification obligations could range from immaterial to having a material adverse impact on its financial position and its ability to continue in the ordinary course of business.

Under certain circumstances, the Company may have recourse through its insurance policies that would enable it to recover from its insurance company some or all amounts paid pursuant to its indemnification obligations. The Company does not have any assets held either as collateral or by third parties that, upon the occurrence of an event requiring it to indemnify a customer, the Company could obtain and liquidate to recover all or a portion of the amounts paid pursuant to its indemnification obligations.

8. NET LOSS PER COMMON SHARE

Basic and diluted net loss per common share is calculated in accordance with SFAS No. 128, “Earnings Per Share.” Basic net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding, excluding unvested restricted stock.

The weighted average number of shares outstanding used in the computation of basic and diluted net loss per share does not include the effect of the following potentially outstanding common stock. The effects of these potentially outstanding shares were not included in the calculation of diluted net loss per share because the effect would have been antidilutive:

	As of July 31
	2006	2005
Unvested restricted stock outstanding	467,412	350,000
Options to purchase common stock	18,467,055	18,322,953
Potential shares to be issued from ESPP	328,118	247,404
Warrants to purchase common stock	3,515,524	3,809,549
Total	22,690,985	22,729,906

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9. COMMITMENTS AND CONTINGENCIES

Legal Matters

Intellectual Property Litigation. On January 5, 2004, TiVo filed a complaint against EchoStar Communications Corporation in the U.S. District Court for the Eastern District of Texas alleging willful and deliberate infringement of U.S. Patent No. 6,233,389, entitled “Multimedia Time Warping System.” On January 15, 2004, the Company amended its complaint to add EchoStar DBS Corporation, EchoStar Technologies Corporation, and Echosphere Limited Liability Corporation as additional defendants. The Company alleges that it is the owner of this patent, and further alleges that the defendants have willfully and deliberately infringed this patent by making, selling, offering to sell and/or selling digital video recording devices, digital video recording device software, and/or personal television services in the United States. On April 13, 2006, the jury rendered a verdict in favor of the Company in the amount of approximately $74.0 million dollars. The jury ruled that the Company’s patent is valid and that all nine of the asserted claims in the Company’s patent are infringed by each of the accused EchoStar products. The jury also ruled that the defendants’ willfully infringed the patent. On May 16, 2006, the United States Patent and Trademark Office (“USPTO”) issued its first Office Action in response to a request by the defendants for reexamination of the ‘389 patent. The USPTO reexamined all 61 claims set forth in the ‘389 patent, confirming the validity of the majority of the claims, including two of the claims that the defendants have been found to have willfully infringed, and rejecting some of the claims. TiVo intends to vigorously defend the validity of the rejected claims. On June 26-28, 2006, the Court held a bench trial on the defendants’ remaining defenses, including inequitable conduct, and a hearing on other issues such as the amount of pre-judgment interest, supplemental damages, enhanced damages, attorney’s fees and costs, and an injunction. On August 17, 2006, the Court denied the defendants’ remaining defenses, and granted TiVo’s motion for permanent injunction to prevent EchoStar Communications Corporation from making, using, offering for sale or selling in the United States the following EchoStar DVRs: DP-501, DP-508, DP-510, DP-721, DP-921, DP-522, DP-625, DP-942, and all EchoStar Communications Corporation DVRs that are not more than colorably different from any of these products. The Court also ordered ECC to pay TiVo approximately $74.0 million in damages as awarded by the jury, prejudgment interest at the prime rate through July 31, 2006 of approximately $5.6 million, and supplemental damages for infringement through July 31, 2006 in the amount of approximately $10.3 million. The Court denied TiVo’s request for enhanced damages and attorney’s fees and costs. The Court denied EchoStar’s request to stay the injunction pending appeal. On August 18, 2006, the United States Court of Appeals for the Federal Circuit temporarily stayed the district court’s injunction. The Court stated that the temporary stay was not based on a consideration of the merits of EchoStar’s request. The Company is incurring material expenses in this litigation.

On April 29, 2005, EchoStar Technologies Corporation filed a complaint against TiVo and Humax USA, Inc. in the U.S. District Court for the Eastern District of Texas alleging infringement of U.S. Patent Nos. 5,774,186 (“Interruption Tolerant Video Program Viewing”), 6,529,685 B2 (“Multimedia Direct Access Storage Device and Formatting Method”), 6,208,804 B1 (“Multimedia Direct Access Storage Device and Formatting Method”) and 6,173,112 B1 (“Method and System for Recording In-Progress Broadcast Programs”). The complaint alleges that EchoStar Technologies Corporation is the owner by assignment of the patents allegedly infringed. The complaint further alleges that the TiVo and Humax have infringed, contributorily infringed and/or actively induced infringement of the patents by making, using, selling or importing digital video recording devices, digital video recording device software and/or personal television services in the United States that allegedly infringe the patents, and that such infringement is willful and ongoing. Under the terms of the Company’s agreement with Humax governing the distribution of certain DVRs that enable the TiVo service, the Company is required to indemnify Humax against any claims, damages, liabilities, costs, and expenses relating to claims that the Company’s technology infringes upon intellectual property rights owned by third parties. On May 10, 2005, Humax formally notified TiVo of the claims against it in this lawsuit as required by Humax’s agreement with TiVo. On July 1, 2005, the defendants filed their answer and counterclaims. On May 10, 2006, the Court dismissed with prejudice, EchoStar’s claim of infringement against TiVo and Humax relating to patent ‘112 (“Method and System for Recording In-Progress Broadcast Programs”) and claims 21-30 and 32 relating to patent ‘186 (“Interruption Tolerant Video Program Viewing”). A claim construction hearing was held on May 11, 2006. On July 14, 2006, United States Magistrate Judge Caroline M. Craven for the United States District Court, Eastern District of Texas, issued a stay of the case pending the USPTO completion of proceedings with respect to TiVo’s request for reexamination of the ‘186, ‘685, and ‘804 patents. The Company intends to defend this action vigorously; however, it is incurring material expenses in connection with this lawsuit and in the event there is an adverse outcome, the Company’s business could be harmed.

On August 5, 2004, Compression Labs, Inc. filed a complaint against TiVo Inc., Acer America Corporation, AudioVox Corporation, BancTec, Inc., BenQ America Corporation, Color Dreams, Inc. (d/b/a StarDot Technologies), Google Inc., ScanSoft, Inc., Sun Microsystems Inc., Veo Inc., and Yahoo! Inc. in the U.S. District Court for the Eastern District of Texas alleging infringement, inducement of others to infringe, and contributory infringement of U.S. Patent No. 4,698,672, entitled “Coding System For Reducing Redundancy.” The complaint alleges that Compression Labs, Inc. is the owner of this patent and has the exclusive rights to sue and recover for infringement thereof. The complaint further alleges that the defendants have infringed, induced infringement, and contributorily infringed this patent by selling devices and/or systems in the United States, at least portions of which are designed to be at least partly compliant with the JPEG standard. On February 16, 2005, the Judicial Panel on Multidistrict Litigation consolidated this and seven other related lawsuits and coordinated pretrial proceedings in the United States District Court for the Northern District of California, where pretrial proceedings are currently ongoing. On January 31, 2006, the USPTO granted a request for reexamination of the patent in question. On May 25, 2006, the USPTO issued its first office action confirming a majority of the claims in the ‘672 patent, while rejecting some claims. On June 28, 2006, the Court issued a claim construction ruling. The Company intends to defend this action vigorously; however, it

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could be forced to incur material expenses in the litigation and, in the event there is an adverse outcome, the Company’s business could be harmed by the inability to enable subscribers to display JPEG photos or having to pay a license fee to enable subscribers to do so.

In August and September 2004, Phillip Igbinadolor, on behalf of himself, filed complaints against TiVo, Sony Corporation, Sony Electronics, Inc., Sony Corporation of America, JVC, Clarrion Corporation of America, and Philips Consumer Electronics Company in the U.S. District Court for the Eastern District of New York alleging infringement of U.S. Patent Nos. 395,884 and 6,779,196 and U.S. Trademark No. 2,260,689, each relating to an “integrated car dubbing system.” The complaints were consolidated into one action captioned Igbinadolor v. Sony Corporation et al. On November 10, 2004, the Company filed its answer, affirmative defenses and counterclaims and on January 31, 2005, the Company filed a motion for summary judgment. On July 18, 2005, the Court granted summary judgment in favor of the Company and the other defendants on the ground that, as a matter of law, there is no infringement of either the patents or the trademark. On August 30, 2005, Mr. Igbinadolor filed a notice of appeal with the United States Court of Appeals for the Federal Circuit appealing the July 18, 2005 summary judgment order. The Federal Circuit docketed the appeal on September 2, 2005. On October 31, 2005, counsel for JVC submitted a letter on behalf of JVC, Sony, TiVo and Clarion advising the Federal Circuit that JVC, Sony and TiVo have declaratory judgment counterclaims for invalidity that remain pending before the district court and requesting that the appeal be dismissed as premature because the district court’s decision was not a final appealable order. On February 10, 2006, the Federal Circuit issued an order dismissing the entire consolidated appeal as premature. This order was issued as a mandate on March 3, 2006 and jurisdiction was transferred back to the district court. On August 3, 2005, the district court requested that defendants notify the court as to whether they intend to pursue their declaratory judgment counterclaims. On August 23, 2006, counsel for TiVo and Sony requested that the district court dismiss without prejudice their declaratory judgment counterclaims on the belief that the district court’s July 18, 2005 summary judgment order in favor of the defendants will be affirmed by the Federal Circuit thereby obviating the need to pursue the counterclaims. The Company is incurring expenses in connection with this litigation that may become material in the future, and in the event there is an adverse outcome, TiVo’s business could be harmed.

Consumer Litigation. On December 22, 2005, a consumer class action lawsuit against TiVo Inc. was filed in the Superior Court of the State of California, County of San Francisco. This action, which is captioned Nolz, et al. v. TiVo, was brought on behalf of a purported class of purchasers of the Company’s gift subscriptions which were allegedly sold to consumers in violation of a California law that allegedly makes it unlawful to sell gift certificates in California containing an expiration date. The Company intends to defend this action vigorously; however, it could be forced to incur material expenses in the litigation, and, in the event there is an adverse outcome, the Company’s business could be harmed.

Securities Litigation. On June 12, 2001, a securities class action lawsuit in which the Company and certain of its officers and directors are named as defendants was filed in the United States District Court for the Southern District of New York. This action, which is captioned Wercberger v. TiVo et al., also names several of the underwriters involved in the Company’s initial public offering as defendants. This class action was brought on behalf of a purported class of purchasers of the Company’s common stock from September 30, 1999, the time of its initial public offering, through December 6, 2000. The central allegation in this action is that the underwriters in the initial public offering solicited and received undisclosed commissions from, and entered into undisclosed arrangements with, certain investors who purchased TiVo common stock in the initial public offering and the after-market. The complaint also alleges that the TiVo defendants violated the federal securities laws by failing to disclose in the initial public offering prospectus that the underwriters had engaged in these alleged arrangements. More than 150 issuers have been named in similar lawsuits. In July 2002, an omnibus motion to dismiss all complaints against issuers and individual defendants affiliated with issuers (including the TiVo defendants) was filed by the entire group of issuer defendants in these similar actions. On October 8, 2002, TiVo’s officers were dismissed as defendants in the lawsuit. On February 19, 2003, the court in this action issued its decision on defendants’ omnibus motion to dismiss. This decision dismissed the Section 10(b) claim as to TiVo but denied the motion to dismiss the Section 11 claim as to TiVo and virtually all of the other issuer-defendants.

On June 26, 2003, the plaintiffs announced a proposed settlement with the Company and the other issuer defendants. The proposed settlement provides that the plaintiffs will be guaranteed $1.0 billion dollars in recoveries by the insurers of the Company and other issuer defendants. Accordingly, any direct financial impact of the proposed settlement is expected to be borne by the Company’s insurers in accordance with the proposed settlement. In addition, the Company and the other settling issuer defendants will assign to the plaintiffs certain claims that they may have against the underwriters. If recoveries in excess of $1.0 billion dollars are obtained by the plaintiffs from the underwriters, the Company’s and the other issuer defendants’ monetary obligations to the class plaintiffs will be satisfied. Furthermore, the settlement is subject to a hearing on fairness and approval by the Federal District Court overseeing the litigations. On February 15, 2005, the Court issued an order preliminarily approving the terms of the proposed settlement. The Court also certified the settlement classes and class representatives for purposes of the proposed settlement only. On April 24, 2006, the Court held a fairness hearing to determine whether the proposed settlement should be approved. Due to the inherent uncertainties of litigation and assignment of claims against the underwriters, and because the settlement has not yet been finally approved by the Federal District Court, the ultimate outcome of the matter cannot be predicted. In accordance with SFAS No. 5, “Accounting for Contingencies” the Company believes any contingent liability related to this claim is not probable or estimable and therefore no amounts have been accrued in regards to this matter as of July 31, 2006.

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The Company is involved in numerous lawsuits in the ordinary course of its business. The Company assesses potential liabilities in connection with these lawsuits under SFAS No. 5, “Accounting for Contingencies.” The Company accrues an estimated loss for these loss contingencies if both of the following conditions are met: information available prior to issuance of the financial statements indicates that it is probable that a liability has been incurred at the date of the financial statements and the amount of loss can be reasonably estimated. As of July 31, 2006, the Company had not accrued a liability for any of the lawsuits filed against it as the conditions for accrual have not been met. The Company expenses legal costs as they are incurred.

Facilities Leases

The Company’s corporate headquarters consists of two buildings located in Alviso, California, which are used for administrative, sales and marketing, customer service, and product research and development activities. In October 1999, the Company entered into an office lease with WIX/NSJ Real Estate Limited Partnership for its headquarters. On April 27, 2006, the Company entered into the First Amendment to Lease Agreement, dated as of February 1, 2006, which amends the Lease Agreement, dated as of October 6, 1999. Under the Amendment, the Company extended for an additional three years, from March 9, 2007 to January 31, 2010, the current Lease Agreement. Under the terms of the Amendment, monthly rent is approximately $165,000 with built-in base rent escalations periodically throughout the lease term. The lease is classified as an operating lease. Rent expense is recognized using the straight-line method over the lease term and for the six months ended July 31, 2006 and 2005 was $1.0 million and $1.5 million, respectively.

Additionally, the Company delivered a letter of credit totaling $477,000, to WIX/NSJ Real Estate Limited Partnership as collateral for performance by the Company of all of its obligations under the lease. The letter of credit is to remain in effect the entire term of the lease, but the amount does decrease over time. The Company also has operating leases for sales and administrative office space in New York.

Operating lease cash payments for the six months ended July 31, 2006 and 2005 were $826,000 and $1.7 million, respectively.

Additionally, the Company leased office space in Berkshire, United Kingdom under an operating lease that expired in March 2006.

Future minimum operating lease payments as of July 31, 2006, were as follows:

Fiscal Year Ending	Lease Payments
	(In thousands)
January 31, 2007 (6 months)		1,096
January 31, 2008		2,054
January 31, 2009		2,105
January 31, 2010		2,167
Total	$	7,422

Revolving Line of Credit Facility with Silicon Valley Bank. On July 11, 2006, the Company extended its loan and security agreement with Silicon Valley Bank for an additional ninety days through September 28, 2006, whereby Silicon Valley Bank agreed maintain the amount of the revolving line of credit it extends to the Company for up to a maximum of $15 million. The line of credit bears interest at the greater of prime or 4.00% per annum, but in an event of default that is continuing, the interest rate becomes 3.00% above the rate effective immediately before the event of default. At July 31, 2006, the Company was in compliance with the covenants and had no amount outstanding under the line of credit. The line of credit terminates and any and all borrowings are due on September 28, 2006. However, the Company has the right to terminate earlier without penalty upon written notice and repayment of all amounts borrowed.

10. COMCAST AGREEMENT

On March 15, 2005, the Company entered into a non-exclusive licensing and marketing agreement with Comcast STB Software DVR, LLC, a wholly-owned subsidiary of Comcast Corporation, and Comcast Corporation, as guarantor of Comcast STB’s obligations under the agreement. Pursuant to this agreement, the Company agreed to develop a TiVo-branded software solution for deployment on Comcast’s DVR platforms, which would enable any TiVo-specific DVR and networking features requested by Comcast, such as WishList^® searches, Season Pass™ recordings, home media features, and TiVoToGo™ transfers. In addition, the Company agreed to develop a TiVo Interactive Advertising Management System for deployment on Comcast platforms to enable the provision of local and national advertising to Comcast subscribers.

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Comcast will pay a recurring monthly fee per Comcast subscriber who receives the TiVo service through Comcast. Comcast will also pay the Company fees for engineering services for the development and integration of the TiVo service software solution (subject to adjustment under certain circumstances) and the TiVo Interactive Advertising Management System.

The initial term of this agreement is for seven years from completion of the TiVo service software solution, with Comcast permitted to renew for additional 1-year terms for up to a total of 8 additional years as long as certain deployment thresholds have been achieved. During the term of the agreement, TiVo will provide Comcast with certain customer and maintenance support and will provide certain additional development work. TiVo will have the continuing right to sell certain types of advertising in connection with the TiVo service offered through Comcast. TiVo will also have a limited right to sell certain types of advertising on other Comcast DVR set-top boxes enabled with the TiVo Interactive Advertising Management System, subject to Comcast’s option to terminate such right in exchange for certain advertising-related payments.

On March 28, 2006, the Company executed the First Amendment to the Licensing and Marketing Agreement, effective as of March 27, 2006, between TiVo Inc. and Comcast STB Software DVR, LLC and Comcast Corporation. The First Amendment to the Licensing and Marketing Agreement extends the acceptance deadline for the TiVo Interactive Advertising Management System from the second anniversary of the Effective Date of the Agreement to February 15, 2008. Concurrently, the Company also finalized the scope of the engineering services to be delivered with respect to the initial statement of work for the TiVo Interactive Advertising Management System. Under the licensing and marketing agreement, Comcast paid TiVo an upfront fee that the Company recorded as deferred revenue. This upfront fee, subsequent milestone payments, and related costs were initially deferred as the arrangement was not complete. Development costs were $4.6 million, as of January 31, 2006, and were classified on the consolidated balance sheet under prepaid expense and other, current. During the three-months ended April 30, 2006 the companies agreed upon the engineering services to be delivered. As a result, the Company recognized all costs ($4.6 million of these deferred costs and $2.6 million of incremental costs for the quarter ended April 30, 2006) and an equal amount of revenues on its unaudited condensed consolidated financial statements. For the three months ended July 31, 2006, the Company recognized an additional $3.0 million in costs and revenues. Currently, it is not possible to separate the various elements within the arrangement due to a lack of fair value for undelivered elements in the contract. Consequently, the Company recognizes revenues and costs based on a zero profit model, which results in the recognition of equal amounts of revenues and costs.

Development and deployment of the TiVo service software solution is targeted to occur within two years from the date of the licensing and marketing agreement. Development and deployment of the TiVo Interactive Advertising Management System is targeted to begin after the second anniversary of this agreement, but by no later than February 15, 2008. In the event development of the TiVo service software solution and the TiVo Interactive Advertising Management System have not been completed by the relevant deadlines, the Company could be subject to certain consequences, including, but not limited to, termination of the agreement. As part of this agreement, Comcast is receiving a non-exclusive, non-transferable license to the Company’s intellectual property in order to deploy the TiVo service software solution and TiVo Interactive Advertising Management System, including certain trademark branding rights and a covenant not to assert under TiVo’s patents, which rights extend only to Comcast Corporation, its affiliates, and certain of its vendors and suppliers with respect to Comcast products and services. Such non-exclusive, non-transferable license to the Company’s intellectual property will, under certain circumstances, continue after the termination of this agreement. In addition, Comcast is entitled to certain most favored customer terms as compared with other multi-channel video distributors who license certain TiVo technology. Pursuant to the terms of this agreement, Comcast has the right to terminate the agreement in the event the Company is the subject of certain change of control transactions involving any of certain specified companies.

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11. DEVELOPMENT AGREEMENT AND SERVICES AGREEMENT WITH DIRECTV, INC.

On April 7, 2006, the Company entered into the Seventh Amendment of the Development Agreement, dated as of February 15, 2002, with DIRECTV, Inc. Under this amendment, which amends the expiration date of the Development Agreement from February 15, 2007, to February 15, 2010, TiVo will continue to provide support for DIRECTV receivers with TiVo service through the extended expiration date of the Development Agreement, and will provide mutually agreed upon development services for no additional fee up to a defined maximum from February 2007 to February 2010. In addition, DIRECTV will continue to have the right to distribute DIRECTV receivers with TiVo service through February 15, 2007, and a related grace period as set forth in the Development Agreement. Further, TiVo and DIRECTV agreed that neither party would assert its patents against the other party with respect to each company’s products and services deployed prior to the expiration of the agreement, subject to limited exceptions. DIRECTV will continue to pay a monthly fee for all households using DIRECTV receivers with TiVo service similar to the amount paid by DIRECTV for households with DIRECTV receivers with TiVo service currently being deployed immediately prior to this amendment, subject to a monthly minimum payment by DIRECTV. The Company defers a portion of these fees equal to the fair value of the undelivered development services. These deferred fees are classified on the Company’s unaudited condensed consolidated balance sheets under deferred revenue, current.

On April 7, 2006, the Company also entered into the First Amendment of the Amended and Restated Services Agreement, dated as of March 31, 2005, with DIRECTV. This amendment extends the terms of the current advertising arrangement between TiVo and DIRECTV, the Services Agreement until February 15, 2010, and additionally provides DIRECTV with the ability to obtain additional technical support and training for its use of advertising-related software tools with DIRECTV receivers with TiVo service.

12. INVESTMENT IN TGC, INC.

On August 9, 2004, the Company acquired a minority interest of 49.3% in TGC, Inc. (“TGC”), a newly formed independent entity. The Company accounts for its investment in TGC under the equity method of accounting as it owns less than 50% of TGC’s equity.

During fiscal year 2005 and the six months ended July 31, 2006, the Company paid and recognized as research and development expense $400,000 and $600,000, respectively, related to various research and development services.

During the six months ended July 31, 2006 the Company capitalized $1.5 million as purchased technology related to assets it acquired from TGC. Of the $1.5 million, $375,000 was paid as of July 31, 2006 and the remaining $1.1 million is due in three equal payments due on or before March 31, 2007.

13. SUBSEQUENT EVENTS.

On August 22, 2006, the Company entered into a non-exclusive licensing and distribution agreement with Cox Communications (“CoxCom, Inc.” or “Cox”). Pursuant to the agreement, the Company has agreed to develop a TiVo-branded software solution for deployment on Cox’s DVR platforms, which would enable Cox to offer TiVo DVR and advertising software to its customers and advertising clients respectively. In addition, TiVo has agreed to develop an advertising management system for deployment on Cox platforms to enable the provision of local and national advertising to Cox subscribers.

Under the agreement, Cox will pay us a recurring monthly fee per box receiving the TiVo service through Cox. Cox will also pay us fees for engineering services for the development and integration of the TiVo service software solution and the advertising management system. Cox will also pay us commissions on certain new Cox subscribers who use the TiVo service as offered by Cox.

The initial term of our agreement is for five years from completion of the TiVo service software solution, but no longer than seven years after the effective date of the agreement. During the term of the agreement, the Company will provide Cox with certain customer support and maintenance services. TiVo will have the continuing right to sell certain types of advertising in connection with the TiVo service offered through Cox. The Company will also have a right to sell certain types of advertising on other Cox DVR set-top boxes enabled with the advertising management system. As part of the agreement, Cox is receiving a non-exclusive, non-transferable license to specific TiVo intellectual property to deploy the TiVo service software solution and advertising management system, including certain trademark branding rights. Cox will also reimburse TiVo for the cost of certain third-party license fees. In addition, Cox may be entitled to certain most favored customer terms if the Company enters into future agreements with multi-channel video distributors whose commitment to deploy TiVo DVR and advertising software is less than Cox’s commitment. Cox has the right to terminate the agreement in the event we are the subject of certain change of control transactions involving any of certain specified companies.

On August 23, 2001, five-year warrants were issued to convertible noteholders and bankers to purchase 2,192,404 shares of the Company’s common stock at an exercise price of $7.85. On August 28, 2006, several of these holders exercised their warrants resulting in the issuance of 424,150 restricted shares of the Company’s common stock, pursuant to the terms of the agreement, and net proceeds of approximately $3.3 million. The balance of the warrants that would have resulted in the issuance of 1,768,254 shares of TiVo Inc. common stock expired unexercised.

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On August 23, 2006, the Company entered into an amendment of its licensing agreement with Gemstar which expanded the scope of the licenses granted to TiVo to include service provider-provisioned devices (e.g., devices distributed by cable & satellite operators, telephone, and/or broadband service providers), where the service provider does not otherwise have an applicable license from Gemstar-TVGuide, and on which TiVo enables its software. The amendment also provides that TiVo’s online scheduling capability will be integrated with the TVGuide.com website.

On September 5, 2006 the Company sold 8,264,463 shares of its common stock, par value $.001 per share, at $7.865 per share in an underwritten public offering. The sale of the shares closed on September 11, 2006. The sale of the shares was registered pursuant to the Company’s $100 million universal shelf registration statement on Form S-3 (File No. 333-113719). The net proceeds from this sale were approximately $64.7 million after deducting the Company’s estimated offering expenses of $310,000. The Company intends to use the net proceeds from the sale of its common stock for general corporate purposes, which may include: funding research, development, sales and marketing; increasing its working capital; reducing indebtedness; and capital expenditures. Pending the application of the net proceeds, the Company expects to invest the net proceeds primarily in U.S government securities and money market funds, as well as in investment-grade, interest-bearing securities.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

You should read the following discussion and analysis in conjunction with the consolidated financial statements and the accompanying notes included in this report and our most recent annual report on Form 10-K and current report on Form 8-K filed on July 21, 2006, the sections entitled “Risk Factors” in Item 1A of our most recent annual report on Form 10-K and Part II, Item 1A of this report and our quarterly report on Form 10-Q for the fiscal quarter ended April 30, 2006, as well as other cautionary statements and risks described elsewhere in this Report and our most recent annual report on Form 10-K and Current Report on Form 8-K filed on July 21, 2006, before deciding to purchase, sell or hold our common stock.

Company Overview

We are a leading provider of technology and services for digital video recorders. The subscription-based TiVo service improves home entertainment by providing consumers with an easy way to record, watch, and control television with such features as Season Pass™ recordings, WishList^® searches, TiVoToGo™ transfers, TiVo KidZone, and online scheduling. As of July 31, 2006, there were just over 4.4 million subscriptions to the TiVo service. We distribute the TiVo service through agreements with leading television service providers such as currently DIRECTV and in the future, Comcast, and Cox as well as through the sale of TiVo enabled DVR’s through our website and through consumer electronics retailers. We also provide innovative marketing solutions for the television industry, including a unique platform for advertisers and audience research.

Executive Overview and Outlook of Financial Results

During the three and six months ended July 31, 2006, we experienced growth in our overall subscription base and service revenues through our continued investment in marketing and research and development. Additionally, we continued to invest in subscription acquisition activities to expand our subscription base and promote the TiVo brand for future partnerships. TiVo-Owned subscriptions gross additions in the second quarter of fiscal year 2007 were approximately 74,000, which was down 4% from the quarter ended July 31, 2005. For the fiscal year ending January 31, 2007, we expect our subscription acquisition costs to increase due at least in part to the new multi-tiered pricing structure and bundled sales program we have implemented which includes a TiVo DVR in exchange for customer commitment to either a one, two, or three year service plan. We expect to continue achieving growth in our TiVo-Owned subscription base in fiscal 2007; however, we expect this growth to be offset by losses in our DIRECTV subscription base as DIRECTV shifts the focus on new deployments to a competing DVR technology and our current DIRECTV with TiVo subscriptions continue to churn out over time.

The following table sets forth selected information as of the three and six months ended July 31, 2006 and 2005:

	Three Months Ended July 31,						Six Months Ended July 31,
	2006			2005			2006			2005
	(In thousands)
				Adjusted						Adjusted
Service and technology revenues	$	52,880		$	40,674		$	107,989		$	80,694
Net revenues	$	59,167		$	39,335		$	115,679		$	86,243
Cost of revenues		(34,236	)		(15,155	)		(67,183	)		(39,663	)
Operating expenses		(32,326	)		(25,761	)		(67,635	)		(49,633	)
Loss from operations	$	(7,395	)	$	(1,581	)	$	(19,139	)	$	(3,053	)
Cash flows from operating activities							$	(32,796	)	$	(6,577	)

Service and Technology Revenues. Our service and technology revenues increased $12.2 million or 30% during the three months ended July 31, 2006 compared to the same prior-year period. This increase was primarily a result of an increase of $7.7 million in subscription revenue due to continued growth in our subscription base and the recognition of Comcast development revenue of $3.0 million.

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Net Revenues. In addition to service and technology revenues, our net revenues include our hardware revenues as well as any offsetting effects of contra-revenue such as rebates, revenue shares, and other payments to channel. Net revenues increased by $19.8 million or 50% during the three months ended July 31, 2006 compared to the same prior-year period. Service and technology revenues increased significantly and we also experienced an increase in hardware revenues due to the rollout of our new Dual Tuner TiVo Box. This increase in hardware revenues was partially offset by an increase in rebate expense.

Cost of Revenues. Our total costs of revenues, which include cost of service revenues, cost of technology revenues, and cost of hardware revenues, increased by $19.1 million or 126% during the three months ended July 31, 2006. The cost of service and technology revenues for the three months ended July 31, 2006 increased by $5.2 million, or 69%, compared to the same prior-year period primarily as a result of the recognition of Comcast development cost of revenues of $3.0 million and incremental costs associated with a higher subscription base. The cost of hardware revenues for the three months ended July 31, 2006 increased by $13.9 million or 181%, compared to the same prior-year period, and this increase is attributed to a corresponding increase in hardware sales.

Operating Expenses. Our operating expenses, including research and development, sales and marketing, and general and administrative expenses, increased $6.6 million or 25% during the three months ended July 31, 2006 compared to the same prior-year period. This increase is largely due to the costs associated with increased headcount coupled with stock-based compensation expense of $3.2 million and a $605,000 increase in ongoing litigation expense which was included in the three months ended July 31, 2006.

Cash Flows from Operating Activities. Our net cash used in operating activities for the six months ended July 31, 2006 was $32.8 million, as compared to $6.6 million used in operating activities for the same prior-year period. This increase in cash flows used in operating activities is largely due to the increase in net loss due to increase operating expenses as compared to the same prior-year period.

Key Business Metrics

Management periodically reviews certain key business metrics in order to evaluate our operations, allocate resources, and drive financial performance in our business. Management monitors these metrics together and not individually as it does not make business decisions based upon any single metric.

Subscriptions. Management reviews this metric, and believes it may be useful to investors, in order to evaluate TiVo’s relative position in the marketplace and to forecast future potential service revenues. Below is a table that details the growth in our subscription base during the past eight quarters. The TiVo-Owned lines refer to subscriptions sold directly by TiVo to consumers who have TiVo-enabled DVRs. The DIRECTV lines refer to subscriptions sold by DIRECTV to consumers who have integrated DIRECTV satellite receivers with TiVo service. Additionally, we provide a breakdown of the percent of TiVo-Owned subscriptions for which consumers pay recurring fees, including on a monthly and a prepaid one, two, or three year basis, as opposed to a one-time upfront product lifetime fee.

	Three Months Ended
(Subscriptions in thousands)	July 31, 2006		April 30, 2006		Jan 31, 2006		Oct 31, 2005		Jul 31, 2005		April 30, 2005		Jan 31, 2005		Oct 31, 2004
TiVo-Owned Subscription Gross Additions:	74		91		221		92		77		104		276		119
Subscription Net Additions:
TiVo-Owned	30		51		183		55		40		72		251		103
DIRECTV	-29		2		173		379		214		247		447		316
Total Subscription Net Additions	1		53		356		434		254		319		698		419
Cumulative Subscriptions:
TiVo-Owned	1,572		1,542		1,491		1,308		1,253		1,213		1,141		890
DIRECTV	2,846		2,875		2,873		2,700		2,321		2,107		1,860		1,413
Total Cumulative Subscriptions	4,418		4,417		4,364		4,008		3,574		3,320		3,001		2,303
% of TiVo-Owned Cumulative	53	%	52	%	51	%	51	%	51	%	51	%	50	%	46	%
Subscriptions paying recurring fees

We define a “subscription” as a contract referencing a TiVo-enabled DVR for which (i) a consumer has paid for the TiVo service and (ii) service is not canceled. We previously offered a product lifetime subscription for general sale, under which consumers could purchase a subscription that is valid for the lifetime of a particular DVR. During the first quarter of fiscal year 2007, we discontinued general sale of the product lifetime service option. We count these as subscriptions until both of the following conditions are met: (i) the four-year period we use to recognize lifetime subscription revenues ends, and (ii) the

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related DVR has not made contact to the TiVo service within the prior six-month period. Lifetime subscriptions past the four-year mark which have not called into the TiVo service for six-months are not counted in this total. We are not aware of any uniform standards for defining subscriptions and caution that our presentation may not be consistent with that of other companies.

We believe TiVo-Owned subscription net additions for the three months ended July 31, 2006 decreased by 10,000 compared to the same prior-year period largely due to an increase in churn resulting from a larger subscription base and because of increased competition from DVRs distributed by cable and satellite providers, including DIRECTV’s TiVo and non-TiVo products. The percent of cumulative TiVo-Owned subscriptions paying recurring fees remained relatively flat at 53% during the three months ended July 31, 2006, as compared to the same prior-year period. For the three months ended July 31, 2006, we experienced a decline in the DIRECTV cumulative subscription base of 29,000 subscriptions compared to our prior quarter. This decrease is due to DIRECTV’s promotion of a competing DVR service from NDS.

As of July 31, 2006, approximately 129,000 product lifetime subscriptions had exceeded the four-year period we use to recognize product lifetime subscription revenues, but had made contact to the TiVo service within the prior six months. This represents approximately 15% of our cumulative lifetime subscriptions as compared to 11% for the three months ended July 31, 2005. We continue to incur costs of services for these subscriptions without recognizing corresponding subscription revenues.

TiVo-Owned Churn Rate per Month. Management reviews this metric, and believes it may be useful to investors, in order to evaluate our ability to retain existing TiVo-Owned subscriptions (including both monthly and product lifetime subscriptions) by providing services that are competitive in the market. Management believes factors such as service enhancements, service commitments, higher customer satisfaction, and improved customer support may improve this metric. Conversely, management believes factors such as increased competition, lack of competitive service features, and increased price sensitivity may cause our TiVo-Owned Churn Rate per month to increase.

We define the TiVo-Owned Churn Rate per month as the total TiVo-Owned subscription cancellations in the period divided by the Average TiVo-Owned subscriptions for the period (including both monthly and product lifetime subscriptions), which then is divided by the number of months in the period. We calculate Average TiVo-Owned subscriptions for the period by adding the average TiVo-Owned subscriptions for each month and dividing by the number of months in the period. We calculate the average TiVo-Owned subscriptions for each month by adding the beginning and ending subscriptions for the month and dividing by two. We are not aware of any uniform standards for calculating churn and caution that our presentation may not be consistent with that of other companies.

The following table presents our TiVo-Owned Churn Rate per month information:

	Three Months Ended
(Subscriptions in thousands)	July 31, 2006		April 30, 2006		Jan 31, 2006		Oct 31, 2005		Jul 31, 2005		April 30, 2005		Jan 31, 2005		Oct 31, 2004
Average TiVo-Owned subscriptions	1,547		1,520		1,388		1,275		1,233		1,180		995		835
Tivo-Owned subscription cancellations	(44	)	(40	)	(38	)	(37	)	(37	)	(32	)	(25	)	(16	)
Tivo-Owned Churn Rate per month	-0.9	%	-0.9	%	-0.9	%	-1.0	%	-1.0	%	-0.9	%	-0.8	%	-0.6	%

The TiVo-Owned Churn Rate per month was 0.9% for the three months ended July 31, 2006, compared to 1.0% for the three months ended July 31, 2005. The TiVo-Owned Churn rate per month of 0.9% for the three months ended July 31, 2006, is primarily comprised of cancellation of recurring subscriptions. We also count as churn those product lifetime subscriptions that have both reached the end of the four-year revenue recognition period and whose DVRs have not contacted the TiVo service within the prior six-months. Conversely, we do not count as churn product lifetime subscriptions that have not reached the end of the four-year revenue recognition period, regardless of whether such subscriptions continue to contact the TiVo service. We anticipate our TiVo-Owned Churn Rate per month will increase in future periods as a result of increased competition in the marketplace and increased churn from product lifetime subscriptions.

Subscription Acquisition Costs or SAC. Management reviews this metric, and believes it may be useful to investors, in order to evaluate trends in the efficiency of our marketing programs and subscription acquisition strategies. We define SAC as our total acquisition costs for a given period divided by TiVo-Owned subscription gross additions for the same period. We define total acquisition costs as the sum of sales and marketing expenses, rebates, revenue share, and other payments to channel, minus hardware gross margin (defined as hardware revenues less cost of hardware revenues). We do not include DIRECTV subscription gross additions in our calculation of SAC because we incur limited or no acquisition costs for new DIRECTV subscriptions. We are not aware of any uniform standards for calculating total acquisition costs or SAC and caution that our presentation may not be consistent with that of other companies.

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	Three Months Ended
	Jul 31, 2006			April 30, 2006			Jan 31, 2006			Oct 31, 2005			Jul 31, 2005			April 30, 2005			Jan 31, 2005			Oct 31, 2004
							Adjusted			Adjusted			Adjusted
	(In thousands, except SAC)
Subscription Acquisition Costs
Sales and marketing expenses	$	8,344		$	7,389		$	10,637		$	10,006		$	7,574		$	6,830		$	11,529		$	14,212
Rebates, revenue share, and other payments to channel		9,948			8,050			19,167			18,234			5,988			3,638			25,188			17,944
Hardware revenues		(16,235	)		(9,453	)		(32,266	)		(24,652	)		(4,649	)		(10,526	)		(50,452	)		(27,894	)
Cost of hardware revenues		21,607			15,146			38,811			24,667			7,697			15,642			52,267			28,486
Total Acquisition Costs		23,664			21,132			36,349			28,255			16,610			15,584			38,532			32,748
TiVo-Owned Subscription Gross Additions		74			91			221			92			77			104			276			119
Subscription Acquisition Costs (SAC)	$	320		$	232		$	164		$	307		$	216		$	150		$	140		$	275

	Twelve Months Ended
	Jul 31, 2006			April 30, 2006			Jan 31, 2006			Oct 31, 2005			Jul 31, 2005			April 30, 2005			Jan 31, 2005			Oct 31, 2004
	Adjusted			Adjusted			Adjusted			Adjusted			Adjusted
	(In thousands, except SAC)
Subscription Acquisition Costs
Sales and marketing expenses	$	36,376		$	35,606		$	35,047		$	35,939		$	40,145		$	38,597		$	37,367		$	30,580
Rebates, revenue share, and other payments to channel		55,399			51,439			47,027			53,048			52,758			53,346			54,696			33,622
Hardware revenues		(82,606	)		(71,020	)		(72,093	)		(90,279	)		(93,521	)		(107,464	)		(111,275	)		(86,360	)
Cost of hardware revenues		100,231			86,321			86,817			100,273			104,092			119,115			120,323			94,743
Total Acquisition Costs		109,400			102,346			96,798			98,981			103,474			103,594			101,111			72,585
TiVo-Owned Subscription Gross Additions		478			481			494			549			576			576			555			416
Subscription Acquisition Costs (SAC)	$	229		$	213		$	196		$	180		$	180		$	180		$	182		$	174

As a result of the seasonal nature of our subscription growth, SAC varies significantly during the year. Management primarily reviews this metric on an annual basis due to the timing difference between our recognition of promotional program expense and the subsequent addition of the related subscription acquisition. For example, we have historically incurred increased sales and marketing expense during our third quarter in anticipation of new subscriptions that may be added during the fourth quarter and in subsequent periods in addition to those added during the third quarter. As such, we have also provided SAC on a rolling twelve month basis.

During the three months ended July 31, 2006, our total acquisition costs were $23.7 million, and SAC was $320. Comparatively, total acquisition costs for the three months ended July 31, 2005 was $16.6 million and SAC was $216. SAC increased by $104 or 48% for the three months ended July 31, 2006 compared to the prior-year period. During the twelve months ended July 31, 2006, our total acquisition costs increased by $5.9 million from the prior twelve months ended July 31, 2005, and SAC increased by $49 from $180 to $229 for the twelve months ended July 31, 2005 and 2006, respectively. These increases in our three and twelve month SAC are primarily due our new multi-tiered pricing structure and bundled sales program that we implemented in March 2006 which includes a TiVo DVR in exchange for a customer commitment to either a one, two, or three year service plan. For the fiscal year ending January 31, 2007, we expect our subscription acquisition costs to continue to increase due to our new multi-tiered pricing structure and bundled sales programs.

Average Revenue Per Subscription or ARPU. Management reviews this metric, and believes it may be useful to investors, in order to evaluate the potential of our subscription base to generate revenues from a variety of sources, including subscription fees, advertising, and audience measurement research. ARPU does not include rebates, revenue share and other payments to channel that reduce our GAAP revenues. Additionally, under the accounting policy for our bundled sales program, revenues associated with these bundled sales transactions, which were previously recognized as hardware revenues, are now being recognized in service revenues, which we believe will over time increase our ARPU as currently presented. As a result, you should not use ARPU as a substitute for measures of financial performance calculated in accordance with GAAP. Management believes it is useful to consider this metric excluding the costs associated with rebates, revenue share and other payments to channel because of the discretionary nature of these expenses and because management believes these expenses are more appropriately monitored as part of SAC. We are not aware of any uniform standards for calculating ARPU and caution that our presentation may not be consistent with that of other companies.

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We calculate ARPU per month for TiVo-Owned subscriptions by subtracting DIRECTV-related service revenues (which includes DIRECTV subscription service revenues and DIRECTV-related advertising revenues) from our total reported service revenues and dividing the result by the number of months in the period. We then divide by Average TiVo-Owned subscriptions for the period, calculated as described above for churn rate. The following table shows this calculation and reconciles ARPU for TiVo-Owned subscriptions to our reported service and technology revenues:

	Three Months Ended
	July 31, 2006			April 30, 2006			Jan 31, 2006			Oct 31, 2005			Jul 31, 2005			April 30, 2005			Jan 31, 2005			Oct 31, 2004
	(In thousands, except ARPU)
TiVo-Owned Average Revenue per Subscription
Service and Technology revenues	$	52,880		$	55,109		$	46,968		$	43,197		$	40,674		$	40,020		$	34,165		$	28,377
Less: Technology revenues		(3,450	)		(8,158	)		(663	)		(901	)		(425	)		(1,676	)		(1,169	)		(699	)
Total Service revenues		49,430			46,951			46,305			42,296			40,249			38,344			32,996			27,678
Less: DIRECTV-related service revenues		(8,201	)		(8,009	)		(9,602	)		(8,637	)		(7,485	)		(7,099	)		(6,762	)		(5,782	)
TiVo-Owned-related service revenues		41,229			38,942			36,703			33,659			32,764			31,245			26,234			21,896
Average TiVo-Owned revenues per month		13,743			12,981			12,234			11,220			10,921			10,415			8,745			7,299
Average TiVo-Owned per month subscriptions		1,547			1,520			1,388			1,275			1,233			1,180			995			835
TiVo-Owned ARPU per month	$	8.88		$	8.54		$	8.82		$	8.80		$	8.86		$	8.83		$	8.79		$	8.74

TiVo-Owned ARPU per month for the three months ended July 31, 2006 increased from the three months ended July 31, 2005 to $8.88 from $8.86, respectively due to in part to our new multi-tiered pricing structure and bundled sales program which yield a higher monthly subscription rate. The impact on ARPU of this increase in subscription rates was partially offset by two factors: (1) an increase in the number of TiVo-Owned product lifetime subscriptions that reached the end of the four-year period we use to recognize lifetime subscription revenue and (2) the impact of our multi-subscription discount, under which some of our recurring revenue subscriptions pay only $6.95 per month.

We calculate ARPU per month for DIRECTV subscriptions by first subtracting TiVo-Owned-related service revenues (which includes TiVo-Owned subscription service revenues and TiVo-Owned related advertising revenues) from our total reported service revenues. Then we divide average revenues per month for DIRECTV-related service revenues by average subscriptions for the period. The following table shows this calculation and reconciles ARPU for DIRECTV subscriptions to service and technology revenues:

	Three Months Ended
	July 31,			April 30,			Jan 31,			Oct 31,			Jul 31,			April 30,			Jan 31,			Oct 31,
	2006			2006			2006			2005			2005			2005			2005			2004
	(In thousands, except ARPU)
DIRECTV Average Revenue per Subscription
Service and Technology revenues	$	52,880		$	55,109		$	46,968		$	43,197		$	40,674		$	40,020		$	34,165		$	28,377
Less: Technology revenues		(3,450	)		(8,158	)		(663	)		(901	)		(425	)		(1,676	)		(1,169	)		(699	)
Total Service revenues		49,430			46,951			46,305			42,296			40,249			38,344			32,996			27,678
Less: TiVo-Owned-related service revenues		(41,229	)		(38,942	)		(36,703	)		(33,659	)		(32,764	)		(31,245	)		(26,234	)		(21,896	)
DIRECTV-related service revenues		8,201			8,009			9,602			8,637			7,485			7,099			6,762			5,782
Average DIRECTV revenues per month		2,734			2,670			3,201			2,879			2,495			2,366			2,254			1,927
Average DIRECTV per month subscriptions		2,858			2,881			2,818			2,505			2,200			1,994			1,622			1,238
DIRECTV ARPU per month	$	0.96		$	0.93		$	1.14		$	1.15		$	1.13		$	1.19		$	1.39		$	1.56

For fiscal 2007, pursuant to the recently amended DIRECTV agreement, TiVo defers a portion of the DIRECTV subscription fees equal to the fair value of the undelivered development services. Otherwise the recurring subscriptions fees in this agreement are similar to the fees for the DIRECTV receivers with TiVo service activated since 2002. ARPU per month for DIRECTV subscriptions for the three months ended July 31, 2006 decreased from the same-year prior period to $0.96 from $1.13, respectively, as a result of the deferred DIRECTV revenues described above.

Critical Accounting Estimates

Critical accounting estimates are those that reflect significant judgments and uncertainties, and may potentially result in materially different results under different assumptions and conditions. We base our discussion and analysis on our condensed consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles as described in Part 1, Item 1, Note 1. “Nature of Operations” in the notes to our condensed consolidated financial statements. The preparation of these financial statements requires us to make estimates and judgments that affect our reported amounts of assets, liabilities, revenue, and expenses and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates. We base our estimates on historical experience and on other assumptions that we believe to be reasonable under the circumstances. The results of this analysis form the basis for our judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may materially differ from these estimates under different assumptions or conditions. For a detailed discussion on the application of these and other accounting estimates, see Part 1, Item 1, Note 2. “Summary of Significant Accounting Policies” in the notes to our condensed consolidated financial statements.

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Recognition Period for Lifetime Subscriptions Revenues. TiVo previously offered a product lifetime subscription option for general sale for the life of the DVR for a one-time, upfront payment. During the first quarter of fiscal year 2007, we discontinued general sale of the product lifetime service option. We recognize subscription revenues from lifetime subscriptions ratably over a four-year period, based on our estimate of the useful life of these DVRs. As of July 31, 2006, 129,000 product lifetime subscriptions had exceeded the four-year period we use to recognize product lifetime subscription revenues and had made contact with the TiVo service within the prior six month period. This represents approximately 15% of our cumulative lifetime subscriptions as compared to 11% for the three months ended July 31, 2005. If we determine at a later date that the useful life of a TiVo-enabled DVR is shorter or longer than four-years, we would recognize revenues from this source over a shorter or longer period. As we gather more user information, we may revise this estimated life.

Engineering Services Project Cost Estimates. For engineering services that are essential to the functionality of the software or involve significant customization or modification, we recognize revenues using the percentage-of-completion method, as described in Statement of Position (SOP) 81-1 “Accounting for Performance of Construction-Type and Certain Production-Type Contracts.” We recognize revenue by measuring progress toward completion based on the ratio of costs, principally labor, incurred to total estimated costs of the project, an input method. In general, these contracts are long-term and complex. We believe we are able to make reasonably dependable estimates based on historical experience and various other assumptions that we believe to be reasonable under the circumstances. These estimates include forecasting of costs and schedules, estimating contract revenue related to contract performance, projecting cost to complete, tracking progress of costs incurred to date, and projecting the remaining effort to complete the project. Costs included in engineering services are labor, materials, and overhead related to the specific activities that are required for the project. Costs related to general infrastructure or platform development are not included in the engineering services project cost estimates. These estimates are assessed continually during the term of the contract and revisions are reflected when the conditions become known. In some cases, we have accepted engineering services contracts that were expected to be losses at the time of acceptance. Provisions for all losses on contracts are recorded when estimates determine that a loss will be incurred on a contract. Using different cost estimates, or different methods of measuring progress to completion, engineering services revenues and expenses may produce materially different results. A favorable change in estimates in a period could result in additional revenue and profit, and an unfavorable change in estimates could result in a reduction of revenue and profit or the recording of a loss that would be borne solely by TiVo.

Consumer Rebate Redemption Rate. In accordance with Emerging Issues Task Force (EITF) 01-09, “Accounting for Consideration Given by a Vendor to a Customer (Including a Reseller of the Vendor’s Products),” we record an estimated potential liability for our consumer rebate program that is based on the percentage of customers that were reimbursed for the rebate for similar past programs and adjust estimates to consider actual redemptions. Currently, the estimated redemption rate for the $150 rebate program is 64% based on historical redemptions for previous $150 rebate programs. During the three and six months ended July 31, 2006, we recorded a charge of $6.1 million and $10.7 million related to current $150 rebate programs announced in September 2005, of which $6.8 million remains accrued as of July 31, 2006. A one-percentage point deviation in our redemption rebate estimate for the three and six months ended July 31, 2006 would have resulted in an increase or decrease in expense of approximately $86,000 and $157,000, respectively. Upon full completion of consumer rebate programs, any unredeemed consumer rebate expense will be reversed. These consumer rebates and sales incentives programs are recognized as “rebates, revenue share, and other payments to channel” in our condensed consolidated financial statements.

Valuation of Inventory. We maintain a finished goods inventory of TiVo-enabled DVRs throughout the year. We value inventory at the lower of cost or net realizable value with cost determined on the first-in, first-out method. We base write-downs to inventories upon current facts and circumstances and are determined in aggregate and evaluated on a total pool basis. We perform a detailed assessment of inventory at each balance sheet date, which includes a review of, among other factors, demand requirements and market conditions. Based on this analysis, we record adjustments, when appropriate, to reflect inventory at lower of cost or market. As of July 31, 2006, we have $455,000 in inventory reserves. Although we make every effort to ensure the accuracy of our forecasts of product demand and pricing assumptions, any significant unanticipated changes in demand or technological developments would significantly impact the value of our inventory and our reported operating results. In the future, if we find that our estimates are too optimistic and determine that our inventory needs to be written down further, we will be required to recognize such costs in our cost of revenue at the time of such determination. Conversely, if we find our estimates are too pessimistic and we subsequently sell product that has previously been written down, our gross margin in that period will be favorably impacted.

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Valuation of Stock-Based Compensation. On February 1, 2006, we adopted the provisions of SFAS 123R, Share-Based Payment, requiring us to recognize expense related to the fair value of our stock-based compensation awards. SFAS No. 123R eliminates the ability to account for stock-based compensation transactions using the intrinsic value method under Accounting Principle Board (APB) Opinion No. 25, Accounting for Stock Issued to Employees, and instead requires that such transactions be accounted for using a fair-value based method. The fair value of our restricted stock awards was calculated based on the fair market value of our stock at the grant date. The fair value of our stock options and ESPP awards was estimated using a Black-Scholes option valuation model. This model requires the input of highly subjective assumptions and elections in adopting and implementing SFAS No. 123R, including expected stock price volatility and the estimated life of each award.

SFAS No. 123R requires the use of a valuation model to calculate the fair value of stock-based awards. We have elected to use the Black-Scholes option-pricing model, which incorporates various assumptions including volatility, expected life, and interest rates. The expected volatility is based on a combination of historical volatility of our common stock and implied volatility in market traded options on our common stock. The expected life of an award is based on the simplified calculation of expected life. The interest rate for periods within the contractual life of the award is based on the average of U.S. Treasury yield curve during the three months ended July 31, 2006.

In addition, SFAS No. 123R requires us to develop an estimate of the number of share-based awards which will be forfeited due to employee turnover. We use historical data to estimate pre-vesting option forfeitures and record stock-based compensation expense only for those awards that are expected to vest. Quarterly changes in the estimated forfeiture rate can affect our gross margin, research and development expenses, sales and marketing expenses, and general and administrative expenses. The expense we recognize in future periods could also differ from the current period and/or our forecasts due to adjustments in the assumed forfeiture rates.

Results of Operations

Net Revenues. Our net revenues for the three months ended July 31, 2006 and 2005 as a percentage of total net revenues were as follows:

	Three Months Ended July 31,										Six Months Ended July 31,
	2006					2005					2006					2005
	(In thousands, except percentages)
Service revenues	$	49,430		84	%	$	40,249		102	%	$	96,381		84	%	$	78,593		91	%
Technology revenues		3,450		6	%		425		1	%	$	11,608		10	%	$	2,101		2	%
Hardware revenues		16,235		27	%		4,649		12	%		25,688		22	%		15,175		18	%
Rebates, revenue share, and other payments to channel		(9,948	)	-17	%		(5,988	)	-15	%		(17,998	)	-16	%		(9,626	)	-11	%
Net revenues	$	59,167				$	39,335				$	115,679				$	86,243
Change from same prior-year period		50	%				-1	%				34	%				16	%

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Service Revenues. Service revenues for the three and six months ended July 31, 2006 increased 23% or $9.2 million and $17.8 million, respectively over the service revenues for the three and six months ended July 31, 2005. This increase was primarily due to the year over year growth in our TiVo-Owned subscription base. During the three months ended July 31, 2006, we activated 30,000 new TiVo-Owned subscription net additions. Our total cumulative subscriptions were just over 4.4 million as of July 31, 2006, a 24% increase over the installed base as of July 31, 2005. We intend to generate continued TiVo-Owned subscription growth through our direct sales channel on our website and by managing our relationships with leading retailers like Best Buy, Circuit City, Target, Radio Shack, and others. Further on March 15, 2006, we began a new multi-tiered pricing and bundled sales model for direct sales through our website that allows customers to receive a TiVo DVR in exchange for the customer’s commitment to either a one, two, or three year service plan. We anticipate fiscal year 2007 will have continued service revenue growth as our TiVo-Owned subscription base grows; however, we expect this to be partially offset by revenue losses from our decreasing number of DIRECTV with TiVo subscriptions. Revenues from advertising and research, which are included in our service revenues, while not material in this period, have increased in the three and six month periods ending July 31, 2006 as compared to the three and six months ended July 31, 2005.

Technology Revenues. During the three and six months ended July 31, 2006, we derived 6% and 10% of our net revenues, or $3.5 million and $11.6 million, from licensing and engineering services compared to 1% and 2% or $425,000 and $2.1 million in the same prior-year periods. This increase was primarily due to the recognition of Comcast development revenue of $10.2 million, of which $3.0 million and $5.6 million was related to the work performed in the three and six month periods ended July 31, 2006 and $4.6 million was related to work performed in the fiscal year ended January 31, 2006. The Comcast development revenue of $10.2 million was offset by an equal amount of development cost recognized as cost of technology revenues. Technology revenues for the three and six months ended July 31, 2005 were largely a result of amortization of deferred revenue on existing contracts, where development services have been substantially completed. During the three months ended July 31, 2005 these revenues were partially offset, as we determined that we needed to incur additional development costs related to a loss contract deemed substantially complete in fiscal year 2005. As a result, we recorded a reduction of $435,000 in technology revenues.

Hardware Revenues. Hardware revenues, net of allowance for sales returns, for the three and six months ended July 31, 2006 was 27% and 22% of our net revenues compared to 12% and 18% for the same prior-year periods. Retail sales revenues for the period ending July 31, 2006 were significantly higher than the same prior-year period. One retail customer generated $5.0 million and $7.4 million of hardware revenues or 8% and 6% of net revenues, respectively for the three and six months ended July 31, 2006. The same retail customer generated $158,000 and $3.8 million of hardware revenues or 0% and 4% of net revenues for the three and six months ended July 31, 2005. The increase in hardware revenues for the three and six months ended July 31, 2006 as compared to the same prior-year period is primary a result of increased sales to our new and existing retail channel due to new retailer agreements, such as Radio Shack and the roll out of our new Dual Tuner TiVo Box.

Rebates, revenue share, and other payments to channel. We recognize certain marketing-related payments as a reduction of revenues in our condensed consolidated statements of operations. These reductions are recorded based on an estimated potential liability for our consumer rebate program, which is based on the percentage of customers that were reimbursed for rebates for similar past programs and then we adjust estimates to consider actual redemptions. Rebates, revenue share, and other payments to channel increased by $4.0 million and $8.4 million for the three and six months ended July 31, 2006 as compared to the same prior-year periods. The primary contributor to the increase in rebates, revenue share, and other payments to channel was lower than expected rebate expenses in the three and six months ended July 31, 2005 due to a reversal of rebate expense, offset by higher expenses in marketing development fund and rewards expenses during the same period. The consumer rebate reversal during the six months ended July 31, 2005 was primarily due to a reduction of the rebate accrual established in fiscal year 2005 for certain rebate programs that ended during the three months ended April 30, 2005 and no rebate programs were offered during the Summer 2005. Consumer rebate expenses was $6.1 million and $10.7 million for the three and six months ended July 31, 2006, as compared to a benefit of $1.0 million and $2.2 million for the three and six months ended July 31, 2005. Additionally, our marketing development expenses decreased to $489,000 and $1.9 million for the three and six month periods ending July 31, 2006, respectively, from $4.1 million and $5.4 million for the same prior year periods.

Cost of service and technology revenues.

	Three Months Ended July 31,						Six Months Ended July 31,
	2006			2005			2006			2005
	(In thousands, except percentages)
Cost of service revenues	$	9,628		$	6,859		$	20,063		$	15,498
Cost of technology revenues	$	3,001		$	599		$	10,367		$	826
Cost of service and technology revenues	$	12,629		$	7,458		$	30,430		$	16,324
Change from same prior-year period		69	%		-22	%		86	%		-5	%
Percentage of service and technology revenues		24	%		18	%		28	%		20	%
Service gross margin	$	39,802		$	33,390		$	76,318		$	63,095
Technology gross margin	$	449		$	(174	)	$	1,241		$	1,275
Service gross margin as a percentage of service revenue		81	%		83	%		79	%		80	%
Technology gross margin as a percentage of technology revenue		13	%		-41	%		11	%		61	%

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Costs of service and technology revenues consist primarily of telecommunication and network expenses, employee salaries, call center, credit card processing fees, and other expenses related to providing the TiVo service. Also included are expenses related to providing engineering services to our customers, including employee salaries and related costs, as well as prototyping and other material costs. Cost of service and technology revenues for the three and six months ended July 31, 2006 increased by $5.2 and $14.1 million or 69% and 86% as compared to the same prior-year periods primarily as a result of the recognition of Comcast development cost of revenues of $3.0 million and $10.2 million for the three and six months ended July 31, 2006, respectively.

Cost of service revenues for the three and six months ended July 31, 2006 increased by 40% and 29%, respectively or $2.8 million and $4.6 million, respectively, as compared to the same prior-year period. The primary driver of the year over year increase was the 24% increase in the total cumulative subscriptions and the costs associated with supporting these additional subscriptions as well as TiVo’s increased focus on issues of customer care and retention.

Cost of technology revenues increased by $2.4 million and $9.5 million for the three and six months ended July 31, 2006, as compared to the same prior-year periods. This increase was a result of the recognition of $3.0 million and $10.2 million for the three and six months ended July 31, 2006, respectively for Comcast development costs, of which $4.6 million of incurred costs was previously deferred as of January 31, 2006. The $3.0 million and the $10.2 million in cost of technology revenues for the three and six months ended July 31, 2006, respectively related to the Comcast development agreement was offset by an equal amount of development revenue recognized as technology revenues.

Cost of hardware revenues.

	Three Months Ended July 31,						Six Months Ended July 31,
	2006			2005			2006			2005
	(In thousands, except percentages)
				Adjusted						Adjusted
Cost of hardware are revenues	$	21,607		$	7,697		$	36,753		$	23,339
Change from same prior-year period		181	%		-66	%		57	%		-41	%
Percentage of hardware revenues		133	%		166	%		143	%		154	%
Hardware are gross margin	$	(5,372	)	$	(3,048	)	$	(11,065	)	$	(8,164	)
Hardware are gross margin as a percentage of hardware revenue		-33	%		-66	%		-43	%		-54	%

Costs of hardware revenues include all product costs associated with the TiVo-enabled DVRs we distribute and sell, including manufacturing-related overhead and personnel, warranty, certain licensing, order fulfillment, and freight costs. We engage a contract manufacturer to build TiVo-enabled DVRs. We sell this hardware as a means to grow our service revenues and, as a result, do not intend to generate positive gross margins from these hardware sales. The net number of DVRs sold to our retailers and through our direct channel increased by approximately 222% compared to the same period of the prior-year. These increases were largely related to our retail channel building inventory due to new retailer agreements, such as Radio Shack and the roll out of our new Dual Tuner TiVo Box. The adoption of our recently announced multi-tiered pricing and bundled sales model in our direct sales channel resulted in an increased gross margin loss, both in terms of absolute dollars and as a percentage of hardware revenue, for the three and six months ended July 31, 2006 as compared to the same prior-year periods. This increase is a result of our full recognition of hardware costs associated with these bundled sales.

Research and development expenses.

	Three Months Ended July 31,						Six Months Ended July 31,
	2006			2005			2006			2005
	(In thousands, except percentages)
Research and development expenses	$	12,891		$	9,778		$	25,752		$	20,682
Change from same prior-year period		32	%		20	%		25	%		21	%
Percentage of net revenues		22	%		25	%		22	%		24	%

Our research and development expenses consist primarily of employee salaries, related expenses, and consulting expenses. Research and development expenses, as a percentage of net revenue decreased 3% and 2% for the three and six months ended July 31, 2006 as compared to the same prior-year periods. However, in terms of absolute dollars, research and development expenses increased 32% and 25% for the three and six months ended July 31, 2006, as compared to the same prior-year periods. The absolute dollar increase in expenses for three and six months ended July 31, 2006 was due largely the costs associated with increased headcount of 43 employees, or $1.7 million and $2.5 million, respectively as compared to the same prior-year periods. The headcount increased largely in response to our initiatives around building and supporting television service provider relationships and our increased focus on our advertising offerings. Additionally there was an increase of $1.4 million and $2.7 million increase in stock-based compensation expense for the three and six months end July 31, 2006, respectively as compared to the same prior-year periods.

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Sales and marketing expenses.

	Three Months Ended July 31,						Six Months Ended July 31,
	2006			2005			2006			2005
	(In thousands, except percentages)
Sales and marketing expenses	$	8,344		$	7,574		$	15,733		$	14,404
Change from same prior-year period		10	%		26	%		9	%		24	%
Percentage of net revenues		14	%		19	%		14	%		17	%

Sales and marketing expenses consist primarily of employee salaries and related expenses, media advertising (including print, online, radio, and television), public relations activities, special promotions, trade shows, and the production of product related items, including collateral and videos. Sales and marketing expenses, as a percentage of net revenue, decreased by 5% and 3% for the three and six months ended July 31, 2006, as compared to the same prior-year periods. However, in terms of absolute dollars sales and marketing expenses increased by 10% and 9% for the three and six months ended July 31, 2006, as compared to the same prior-year periods. The largest contributors to the increase in sales and marketing expenses for the three and six months ended July 31, 2006, in terms of absolute dollars, was related to increased headcount of 9 employees or $426,000 and $607,000 for the three and six months periods ending July 31, 2006, as compared to the same prior-year periods. Additionally, stock-based compensation expense increased by $596,000 and $830,000, respectively as compared to the same prior-year periods.

General and administrative expenses.

	Three Months Ended July 31,						Six Months Ended July 31,
	2006			2005			2006			2005
	(In thousands, except percentages)
General and administrative	$	11,091		$	8,409		$	26,150		$	14,547
Change from same prior-year period		32	%		122	%		80	%		81	%
Percentage of net revenues		19	%		21	%		23	%		17	%

General and administrative expenses consist primarily of employee salaries and related expenses for executive, administrative, legal, accounting, information technology systems, customer operations personnel, facility costs, and professional fees. General and administrative expenses, as a percentage of net revenues decreased 2% for the three months ended July 31, 2006 and increased 6% for the six months ended July 31, 2006 as compared to the same prior-year periods, and in terms of absolute dollars increased 32% and 80%, compared to the same prior-year periods. For the three and six months ended July 31, 2006, legal and consulting expenses related to ongoing litigation increased $605,000 and $6.5 million, respectively, compared to the same prior-year periods. Additionally, headcount related costs increased by $1.2 million and $2.1 million for the three and six months ended July 31, 2006, respectively as compared to the same prior-year periods. These cost increases were due in part to increased headcount of 18 employees, largely within our Information technology systems department, for the three and six months ended July 31, 2006, respectively. Additionally, stock-based compensation expense increased $1.2 million and $2.6 million for the three and six months ended July 31, 2006. We expect to continue to incur legal expenses for all pending lawsuits, including material amounts related to the EchoStar Communications patent infringement cases in the future.

Interest income. Interest income resulting from cash and cash equivalents held in interest bearing accounts and short-term investments for the three and six months ended July 31, 2006 was $1.0 million and $2.1 million, a 34% and 51% increase, respectively from the same prior-year periods. These increases were a result of an increase to 4.68% in the average interest rate earned in the six months ended July 31, 2006 from 2.81% in the same prior-year period.

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Quarterly Results of Operations

The following table presents certain unaudited statements of operations data for our eight most recent quarters ended July 31, 2006. In management’s opinion, this unaudited information has been prepared on the same basis as the audited annual financial statements and includes all adjustments, consisting only of normal recurring adjustments necessary for a fair representation of the unaudited information for the quarters presented. This information should be read in conjunction with our audited consolidated financial statements and the notes thereto, which are included in our 2006 Annual Report on Form 10-K and Current Report on Form 8-K filed on July 21, 2006. The results of operations for any quarter are not necessarily indicative of results that may be expected for any future period. Certain amounts in prior periods have been adjusted to conform to the current year presentation in accordance with the Change Accounting Policy set forth under the Part I, Item 1, Note 2. “Summary of Significant Accounting Policies” in the notes to our condensed consolidated financial statements, as filed with our Quarterly Report on Form 10-Q for the period ended April 30, 2006.

	Three Months Ended
	Jul 31, 2006			Apr 30, 2006			Jan 31, 2006			Oct 31, 2005			Jul 31, 2005			Apr 30, 2005			Jan 31, 2005			Oct 31, 2004
							Adjusted			Adjusted			Adjusted
	(unaudited, in thousands except per share data)
Revenues
Service revenues	$	49,430		$	46,951		$	46,305		$	42,296		$	40,249		$	38,344		$	32,996		$	27,678
Technology revenues		3,450			8,158			663			901			425			1,676			1,169			699
Hardware revenues		16,235			9,453			32,266			24,652			4,649			10,526			50,452			27,894
Rebates, revenue share, and other payments to channel		(9,948	)		(8,050	)		(19,167	)		(18,234	)		(5,988	)		(3,638	)		(25,188	)		(17,944	)
Net revenues		59,167			56,512			60,067			49,615			39,335			46,908			59,429			38,327
Cost of revenues
Cost of service revenues		9,628			10,435			10,250			8,431			6,859			8,639			10,426			6,505
Cost of technology revenues		3,001			7,366			(121	)		77			599			227			440			1,465
Cost of hardware revenues		21,607			15,146			38,811			24,667			7,697			15,642			52,267			28,486
Total cost of revenues		34,236			32,947			48,940			33,175			15,155			24,508			63,133			36,456
Gross margin		24,931			23,565			11,127			16,440			24,180			22,400			(3,704	)		1,871
Operating Expenses
Research and development		12,891			12,861			10,693			9,712			9,778			10,904			11,206			9,291
Sales and marketing		8,344			7,389			10,637			10,006			7,574			6,830			11,529			14,212
General and administrative		11,091			15,059			11,769			11,702			8,409			6,138			4,194			4,366
Loss from operations		(7,395	)		(11,744	)		(21,972	)		(14,980	)		(1,581	)		(1,472	)		(30,633	)		(25,998	)
Interest income		988			1,062			900			826			734			624			458			397
Interest expense and other		(29	)		(3	)		(1	)		(10	)		(2	)		(1	)		(3,464	)		(671	)
Loss before income taxes		(6,436	)		(10,685	)		(21,073	)		(14,164	)		(849	)		(849	)		(33,639	)		(26,272	)
Provision for income taxes		(12	)		(19	)		(13	)		—			(43	)		(8	)		(26	)		(78	)
Net Loss	$	(6,448	)	$	(10,704	)	$	(21,086	)	$	(14,164	)	$	(892	)	$	(857	)	$	(33,665	)	$	(26,350	)
Net Loss per common share basic and diluted	$	(0.07	)	$	(0.13	)	$	(0.25	)	$	(0.17	)	$	(0.01	)	$	(0.01	)	$	(0.42	)	$	(0.33	)
Weighted average common shares used to calculate basic net loss per share		85,978			85,134			84,643			84,201			83,506			82,381			80,793			80,267

Liquidity and Capital Resources

We have financed our operations and met our capital expenditure requirements from the proceeds of the sale of equity and debt securities, as well as revenues generated from our operations. Our cash resources are subject, in part, to the amount and timing of cash received from our subscriptions, licensing and engineering services customers, and hardware customers. At July 31, 2006, we had $75.1 million of cash and cash equivalents and short-term investments. We believe our cash and cash equivalents and short-term investments, and funds generated from operations represent sufficient resources of liquidity to fund operations, capital expenditures, and working capital needs through the next twelve months.

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Statement of Cash Flows Discussion

Our primary sources of liquidity are cash flows provided by operations and by financing activities. Although we currently anticipate our current resources of liquidity, identified above, will be sufficient to meet our cash needs through the next twelve months, we may require or choose to obtain additional financing. Our ability to obtain financing will depend, among other things, on our development efforts, business plans, operating performance, and the condition of the capital markets at the time we seek financing. We cannot assure you that additional financing will be available to us on favorable terms when required, or at all. If we raise additional funds through the issuance of equity, equity-linked or debt securities, those securities may have rights, preferences or privileges senior to the rights of our common stock, and our stockholders may experience dilution. Please refer to Part II, Item 1A, “Risk Factors” in this Report and Part I, Item 1A, “Risk Factors” in our most recent annual report on Form 10-K for further discussion.

The following table summarizes our cash flow activities:

	Six Months Ended July 31,
	2006			2005
	(in thousands)
				Adjusted
Net cash used in operating activities	$	(32,796	)	$	(6,577	)
Net cash used in investing activities		478			(2,033	)
Net cash provided by financing activities		7,538			10,538

Net Cash Used in Operating Activities

The net cash used in operating activities was approximately $32.8 million during the six months ended July 31, 2006, an increase of approximately $26.2 million from a use of $6.6 million in the same prior-year period. The increase in net cash used in operating activities in the six months ended July 31, 2006 was largely attributable to an increase in net loss of approximately $15.4 million during six months ended July 31, 2006 due to increased operating expenses. Additionally, we had a reduction in working capital of approximately $14.3 million during the six months ended July 31, 2006.

Net Cash Used in Investing Activities

Net cash used in investing activities for the six months ended July 31, 2006 was largely due to purchases of property and equipment for $3.5 million to support our business growth and $375,000 used to purchase technology utilized within our new Dual Tuner TiVo Box. This usage was offset by the sale of short-term investments of $4.4 million.

Net Cash Provided by Financing Activities

For the six months ended July 31, 2006, the principal source of cash generated from financing activities related to the issuance of common stock of which $6.2 million was related to stock option exercises and $1.3 million was issuances related to our employee stock purchase plan. For the six months ended July 31, 2005, cash generated from financing activities was $5.9 million and $1.2 million from issuance of common stock for stock options exercised and our employee stock purchase plan, respectively.

Financing Agreements

$100 Million Universal Shelf Registration Statement. We have an effective universal shelf registration statement on Form S-3 (No. 333-113719) on file with the Securities and Exchange Commission under which we may issue up to $100,000,000 of securities, including debt securities, common stock, preferred stock, and warrants. Depending upon market conditions, we may issue securities under this or future registration statements.

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Revolving Line of Credit Facility with Silicon Valley Bank. On July 11, 2006, we extended our loan and security agreement with Silicon Valley Bank for an additional ninety days through September 28, 2006, whereby Silicon Valley Bank agreed maintain the amount of the revolving line of credit it extends to us for up to a maximum of $15 million. The line of credit bears interest at the greater of prime or 4.00% per annum, but in an event of default that is continuing, the interest rate becomes 3.00% above the rate effective immediately before the event of default. At July 31, 2006, we were in compliance with the covenants and had no amount outstanding under the line of credit. The line of credit terminates and any and all borrowings are due on September 28, 2006. However, we have the right to terminate earlier without penalty upon written notice and repayment of all amounts borrowed. We may seek to renew this line of credit or obtain a new line of credit. Any new line of credit may provide for additional borrowings and may be secured by some or all of our property.

Contractual Obligations

	Payments due by Period
	Total		Less than 1 year		1-3 years		3-5 years
	(In thousands)
Contractual Obligations
Operating leases	$	7,422	$	2,128	$	4,211	$	1,083
Purchase obligations		31,447		31,447		—		—
Total contractual cash obligations	$	38,869	$	33,575	$	4,211	$	1,083

Purchase Commitments with Contract Manufacturers and Suppliers. We purchase components from a variety of suppliers and use several contract manufacturers to provide manufacturing services for our products. During the normal course of business, in order to manage manufacturing lead times and help assure adequate component supply, we enter into agreements with contract manufacturers and suppliers that either allow them to procure inventory based upon criteria as defined by us or that establish the parameters defining our requirements. In certain instances, these agreements allow us the option to cancel, reschedule, and adjust our requirements based on our business needs prior to firm orders being placed. The table above displays that portion of our purchase commitments arising from these agreements that is firm, non-cancelable, and unconditional. The purchase commitments of $31.4 million for the quarter ended July 31, 2006 was significantly higher than the same prior-year period primarily related to the building of new DVR models. The purchase commitments of $4.4 million for the quarter ended July 31, 2005 were much lower than the same period this year as a result of a larger than expected amount of inventory in the channel and on-hand after last year’s holiday season.

Off-Balance Sheet Arrangements

As part of our ongoing business, we generally do not engage in transactions that generate relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities. Accordingly, our operating results, financial condition, and cash flows are not generally subject to off-balance sheet risks associated with these types of arrangements. We did not have any material off-balance sheet arrangements at July 31, 2006.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Our exposure to market risk for changes in interest rates relates primarily to our investment portfolio. We do not use derivative financial instruments in our investment portfolio and we conduct transactions in U.S. dollars. Our investment portfolio only includes highly liquid instruments with original maturities of less than one year.

We are subject to fluctuating interest rates that may affect, adversely or otherwise, our results of operations or cash flows for our cash and cash equivalents and our short-term investments.

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The table below presents principal amounts and related weighted average interest rates as of July 31, 2006 for our cash and cash equivalents and short-term investments.

Cash and cash equivalents and short-term investments (in thousands)	$	75,118
Average interest rate			4.68	%

Although payments under the operating lease for our facility are tied to market indices, we are not exposed to material interest rate risk associated with the operating lease.

ITEM 4. CONTROLS AND PROCEDURES.

We maintain disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended), that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

In designing and evaluating the disclosure controls and procedures, our management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and our management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

As required by Rule13a-15(b) and 15d-15(b) under the Exchange Act, we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the fiscal quarter covered by this report. Based upon the foregoing, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective in reaching a level of reasonable assurance in achieving our desired control objectives.

There have been no significant changes in our internal control over financial reporting during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting

PART II OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

The information under the heading “Legal Matters” set forth under Note 8 of Notes to Unaudited Condensed Consolidated Financial Statements, included in Part I, Item 1. of this Report, is incorporated herein by reference.

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ITEM 1A. RISK FACTORS.

Intellectual property claims against us could be costly and could result in the loss of significant rights.

From time to time, we receive letters from third parties alleging that we are infringing their intellectual property. Regardless of their merit, we are forced to devote time and resources to respond to these letters. In addition, if any of these third parties or others were to sue us, our business could be harmed because intellectual property litigation may:

• be time-consuming and expensive;

• divert management’s attention and resources away from our business;

• cause delays in product delivery and new service introduction;

• cause the cancellation of new products or services; or

• require us to pay significant royalties and/or licensing fees.

The emerging enhanced-television industry is highly litigious, particularly in the area of on-screen program guides. Additionally, many patents covering interactive television technologies have been granted but have not been commercialized. For example, we are aware of multiple patents for pausing live television. A number of companies in the enhanced-television industry earn substantial profits from technology licensing, and the introduction of new technologies such as ours is likely to provoke lawsuits from such companies. A successful claim of infringement against us, our inability to obtain an acceptable license from the holder of the patent or other right, or our inability to design around an asserted patent or other right could cause our manufacturers to cease manufacturing DVRs that enable the TiVo service, our retailers to stop selling the product or us to cease providing our service, or all of the above, which would eliminate our ability to generate revenues.

Under our agreements with many of our manufacturing and licensing partners, we are obligated to indemnify them in the event that our technology infringes upon the intellectual property rights of third parties. Due to these indemnity obligations, we could be forced to incur material expenses if our manufacturing and licensing partners are sued. If they were to lose the lawsuit, our business could be harmed. In addition, because the products sold by our manufacturing and licensing partners often involve the use of other persons’ technology, this increases our exposure to litigation in circumstances where there is a claim of infringement asserted against the product in question, even if the claim does not pertain to our technology.

Pending intellectual property litigations. On August 5, 2004, Compression Labs, Inc. filed a complaint against TiVo, Acer America Corporation, AudioVox Corporation, BancTec, Inc., BenQ American Corporation, Color Dreams, Inc. (d/b/a StarDot Technologies), Google Inc., ScanSoft, Inc., Sun Microsystems Inc. Veo Inc., and Yahoo! Inc. in the U.S. District Court for the Eastern District of Texas alleging infringement, inducement of others to infringe, and contributory infringement of U.S. Patent No. 4,698,672, entitled “Coding System For Reducing Redundancy.” The complaint alleges that Compression Labs, Inc. is the owner of this patent and has the exclusive rights to sue and recover for infringement thereof. The complaint further alleges that the defendants have infringed, induced infringement, and contributorily infringed this patent by selling devices and/or systems in the United States, at least portions of which are designed to be at least partly compliant with the JPEG standard. On February 16, 2005, the Judicial Panel on Multidistrict Litigation consolidated this and seven other related lawsuits and coordinated pretrial proceedings in the United States District Court for the Northern District of California, where pretrial proceedings are currently ongoing. On January 31, 2006, the United States Patent Office (“USPTO”) granted a request for reexamination of the patent in question. On May 25, 2006, the USPTO issued its first office action confirming a majority of the claims in the ‘672 patent, while rejecting some claims. On June 28, 2006, the Court issued a claim construction ruling. We intend to defend this action vigorously; however, we could be forced to incur material expenses in the litigation and, in the event there is an adverse outcome, our business could be harmed.

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In August and September 2004, Phillip Igbinadolor, on behalf of himself, filed complaints against TiVo, Sony Corporation, Sony Electronics, Inc., Sony Corporation of America, JVC, Clarrion Corporation of America, and Philips Consumer Electronics Company in the U.S. District Court for the Eastern District of New York alleging infringement of U.S. Patent Nos. 395,884 and 6,779,196 and U.S. Trademark No. 2,260,689, each relating to an “integrated car dubbing system.” The complaints were consolidated into one action captioned Igbinadolor v. Sony Corporation et al. The complaints allege that Mr. Igbinadolor is the owner of the patents and trademark allegedly infringed. On November 10, 2004, we filed our answer, affirmative defenses and counterclaims and on January 31, 2005, we filed a motion for summary judgment. On July 18, 2005, the Court granted summary judgment in our favor and in favor of the other defendants on the ground that, as a matter of law, there is no infringement of either the patents or the trademark. On August 30, 2005, Mr. Igbinadolor filed a notice of appeal with the United States Court of Appeals for the Federal Circuit appealing the July 18, 2005 summary judgment order. The Federal Circuit docketed the appeal on September 2, 2005. On October 31, 2005, counsel for JVC submitted a letter on behalf of JVC, Sony, TiVo and Clarion advising the Federal Circuit that JVC, Sony and TiVo have declaratory judgment counterclaims for invalidity that remain pending before the district court and requesting that the appeal be dismissed as premature because the district court’s decision was not a final appealable order. On February 10, 2006, the Federal Circuit issued an order dismissing the entire consolidated appeal as premature. This order was issued as a mandate on March 3, 2006 and jurisdiction was transferred back to the district court. On August 3, 2005, the district court requested that defendants notify the court as to whether they intend to pursue their declaratory judgment counterclaims. On August 23, 2006, counsel for TiVo and Sony requested that the district court dismiss without prejudice their declaratory judgment counterclaims on the belief that the district court’s July 18, 2005 summary judgment order in favor of the defendants will be affirmed by the Federal Circuit thereby obviating the need to pursue the counterclaims. We are incurring expenses in connection with this litigation that may become material in the future, and in the event there is an adverse outcome, our business could be harmed.

On April 29, 2005, EchoStar Technologies Corporation filed a complaint against TiVo and Humax USA, Inc. in the U.S. District Court for the Eastern District of Texas alleging infringement of U.S. Patent Nos. 5,774,186 (“Interruption Tolerant Video Program Viewing”), 6,529,685 B2 (“Multimedia Direct Access Storage Device and Formatting Method”), 6,208,804 B1 (“Multimedia Direct Access Storage Device and Formatting Method”) and 6,173,112 B1 (“Method and System for Recording In-Progress Broadcast Programs”). The complaint alleges that EchoStar Technologies Corporation is the owner by assignment of the patents allegedly infringed. The complaint further alleges that the TiVo and Humax have infringed, contributorily infringed and/or actively induced infringement of the patents by making, using, selling or importing digital video recording devices, digital video recording device software and/or personal television services in the United States, that allegedly infringe the patents, and that such infringement is willful and ongoing. Under the terms of our agreement with Humax governing the distribution of certain DVRs that enable the TiVo service, we are required to indemnify Humax against any claims, damages, liabilities, costs, and expenses relating to claims that our technology infringes upon intellectual property rights owned by third parties. On May 10, 2005, Humax formally notified us of the claims against it in this lawsuit as required by our agreement with Humax. On July 1, 2005, the defendants filed their answer and counterclaims. On May 10, 2006, the Court dismissed with prejudice, EchoStar’s claim of infringement against TiVo and Humax relating to patent ‘112 (“Method and System for Recording In-Progress Broadcast Programs”) and claims 21-30 and 32 relating to patent ‘186 (“Interruption Tolerant Video Program Viewing”). A claim construction hearing was held on May 11, 2006. On July 14, 2006, United States Magistrate Judge Caroline M. Craven for the United States District Court, Eastern District of Texas, issued a stay of the case pending the United States Patent and Trademark Office (USPTO) completion of proceedings with respect to TiVo’s request for reexamination of the ‘186, ‘685, and ‘804 patents. We intend to defend this action vigorously; however, we could be forced to incur material expenses in connection with this lawsuit and/or as a result of our indemnification obligations and, in the event there is an adverse outcome, our business could be harmed.

We have filed a patent infringement lawsuit against EchoStar Communications Corporation. We are incurring significant expenses as a result, and an adverse outcome in the lawsuit could harm our business.

40

On January 5, 2004, we filed a complaint against EchoStar Communications Corporation (“ECC”) in the U.S. District Court for the Eastern District of Texas alleging willful and deliberate infringement of U.S. Patent No. 6,233,389, entitled “Multimedia Time Warping System.” On January 15, 2004, we amended our complaint to add EchoStar DBS Corporation, EchoStar Technologies Corporation, and Echosphere Limited Liability Corporation as additional defendants. We allege that we are the owner of this patent and further allege that the defendants have willfully and deliberately infringed this patent by making, selling, offering to sell and/or selling digital video recording devices, digital video recording device software, and/or personal television services in the United States. On March 9, 2005, the Court denied motions to dismiss and transfer our patent infringement case against EchoStar Communications Corporation and its affiliates. On August 18, 2005, the Court issued a claim construction order. On April 13, 2006, the jury rendered a verdict in our favor for the amount of approximately $74.0 million dollars. The jury ruled that our patent is valid and that all nine of the asserted claims in our patent are infringed by each of the accused EchoStar products. The jury also ruled that the defendants’ willfully infringed the patent. On May 16, 2006, the USPTO issued its first Office Action in response to a request by the defendants for reexamination of the ‘389 patent. The USPTO reexamined all 61 claims set forth in the ‘389 patent, confirming the validity of the majority of the claims, including two of the claims that the defendants have been found to have willfully infringed, and rejecting some of the claims. TiVo intends to vigorously defend the validity of the rejected claims. On June 26-28, 2006, the Court held a bench trial on the defendants’ remaining defenses, including inequitable conduct, and a hearing on other issues such as the amount of pre-judgment interest, supplemental damages, enhanced damages, attorney’s fees and costs, and an injunction. On August 17, 2006, the Court denied the defendants’ remaining defenses, and granted our motion for permanent injunction to prevent EchoStar Communications Corporation from making, using, offering for sale or selling in the United States the following EchoStar DVRs: DP-501, DP-508, DP-510, DP-721, DP-921, DP-522, DP-625, DP-942, and all EchoStar Communications Corporation DVRs that are not more than colorably different from any of these products. The Court also ordered ECC to pay TiVo approximately $74.0 million in damages as awarded by the jury, prejudgment interest at the prime rate through July 31, 2006 of approximately $5.6 million, and supplemental damages for infringement through July 31, 2006 in the amount of approximately $10.3 million. The Court denied our request for enhanced damages and attorney’s fees and costs. The Court denied EchoStar’s request to stay the injunction pending appeal. On August 18, 2006, the United States Court of Appeals for the Federal Circuit temporarily stayed the district court’s injunction. The court stated that the temporary stay was not based on a consideration of the merits of EchoStar’s request. The Company is incurring material expenses in this litigation.

We face risks in connection with our licensing and marketing agreements with Comcast and Cox for the development of a TiVo-branded DVR software solution and advertising management system for deployment to Comcast and Cox customers.

We may never develop the purchased TiVo-branded DVR software solution and/or advertising management system. Pursuant to our agreement with Comcast, development and deployment of the TiVo service software solution is targeted to occur within two years from March 15, 2005. Development and deployment of the TiVo advertising management system is targeted to begin after the second anniversary of this agreement, but by no later than February 15, 2008. Similarly, there are separate deadlines associated with our development and deployment of the TiVo service software solution and advertising management system in our agreement with Cox. We could be subject to certain consequences, including, but not limited to, termination of these agreements in the event development of the TiVo service software solution and the TiVo advertising management system are not completed by the relevant deadlines. Our ability to develop and enable deployment by Comcast and Cox of the TiVo service software solution and advertising management system by the relevant deadlines could be delayed or prevented by technological problems or a lack of available resources to meet our obligations under the agreement. In the event we fail to deliver either the TiVo service software solution and/or advertising management system to Comcast or Cox by the relevant deadlines, our agreements with Comcast and/or Cox could be terminated and our business could be harmed.

We may not be successful in our agreements with Comcast and Cox. Our ability to benefit from our agreements with Comcast and Cox are dependent upon the mass-deployment and adoption of the TiVo service software solution by Comcast and Cox customers. Additionally, our ability to benefit from our agreements with Comcast and Cox are dependent upon our ability to successfully sell advertising to third parties. Furthermore, Comcast and Cox each have the right to receive certain most favored terms from us such that if we were to license similar products and services to other parties at more attractive terms than what Comcast or Cox receive under their respective agreements with us, they may be entitled to receive the new more favorable terms. Additionally, Comcast and Cox each have the right to terminate its agreement with us in the event we are subject to certain specified change of control transactions involving companies specified in their respective agreements. In the event any of these events occurred, we would have difficulty generating revenues under these agreements and our business could be harmed.

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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

None

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

The Annual Meeting of Stockholders of TiVo Inc. was held at the offices of Latham & Watkins LLP, 140 Scott Drive, Menlo Park, California on August 2, 2006. Out of 86,300,053 shares of Common Stock (as of the record date of June 7, 2006) entitled to vote at the meeting, 77,998,249 shares were present in person or by proxy.

The vote for nominated directors, to serve until the 2007 Annual Meeting of Stockholders, and until their successors are elected, was as follows:

NOMINEE	IN FAVOR	WITHHELD
Michael Ramsay	77,537,339	460,910
Randy Komisar	77,426,913	571,336
Geoffrey Y. Yang	74,638,530	3,359,719

The following directors’ terms of office continued after the meeting: Charles B. Fruit, Mark W. Perry, Joe Uva, and David M. Zaslav.

The results of voting on the ratification of the selection of KPMG LLP as independent auditors for the Company for the fiscal year ending January 31, 2007, were as follows:

IN FAVOR	OPPOSED	ABSTAIN
77,708,523	204,483	85,243

ITEM 5. OTHER INFORMATION.

On August 22, 2006, we entered into a non-exclusive licensing and distribution agreement with Cox Communications (“CoxCom, Inc.” or “Cox”). Pursuant to our agreement, we have agreed to develop a TiVo-branded software solution for deployment on Cox’s DVR platforms, which would enable Cox to offer TiVo DVR and advertising software to its customers and advertising clients respectively. In addition, we have agreed to develop an advertising management system for deployment on Cox platforms to enable the provision of local and national advertising to Cox subscribers.

Under the agreement, Cox will pay us a recurring monthly fee per box receiving the TiVo service through Cox. Cox will also pay us fees for engineering services for the development and integration of the TiVo service software solution and the advertising management system. Cox will also pay us commissions on certain new subscribers who use the TiVo service as offered by Cox.

The initial term of our agreement is for five years from completion of the TiVo service software solution, but no longer than seven years after the effective date of the agreement. During the term of the agreement, we will provide Cox with certain customer support and maintenance services. We will have the continuing right to sell certain types of advertising in connection with the TiVo service offered through Cox. We will also have a right to sell certain types of advertising on other Cox DVR set-top boxes enabled with the advertising management system. As part of our agreement, Cox is receiving a non-exclusive, non-transferable license to specific TiVo intellectual property to deploy the TiVo service software solution and advertising management system, including certain trademark branding rights. Cox will also reimburse TiVo for the cost of certain third-party license fees. In addition, Cox may be entitled to certain most favored customer terms if we enter into future agreements with multi-channel video distributors whose commitment to deploy TiVo DVR and advertising software is less than Cox’s commitment. Cox has the right to terminate the agreement in the event we are the subject of certain change of control transactions involving any of certain specified companies.

42

On August 23, 2001, five-year warrants were issued to convertible noteholders and bankers to purchase 2,192,404 shares of our common stock at an exercise price of $7.85. On August 28, 2006, several of these holders exercised their warrants resulting in the issuance of 424,150 shares of our common stock, pursuant to the terms of the agreement, and net proceeds of approximately $3.3 million. The balance of the warrants that would have resulted in the issuance of 1,768,254 shares of TiVo Inc. common stock expired unexercised.

On August 23, 2006, we entered into an amendment of our licensing agreement with Gemstar which expanded the scope of the licenses granted to TiVo to include service provider-provisioned devices (e.g., devices distributed by cable & satellite operators, telephone, and/or broadband service providers), where the service provider does not otherwise have an applicable license from Gemstar-TVGuide, and on which TiVo enables its software. The amendment also provides that TiVo’s online scheduling capability will be integrated with the TVGuide.com website.

On September 5, 2006 we sold 8,264,463 shares of our common stock, par value $.001 per share, at $7.865 per share in an underwritten public offering. The sale of the shares closed on September 11, 2006. The sale of the shares was registered pursuant to our $100 million universal shelf registration statement on Form S-3 (File No. 333-113719). The net proceeds from this sale were approximately $64.7 million after deducting our estimated offering expenses of $310,000. We intend to use the net proceeds from the sale of our common stock for general corporate purposes, which may include: funding research, development, sales and marketing; increasing our working capital; reducing indebtedness; and capital expenditures. Pending the application of the net proceeds, we expect to invest the net proceeds primarily in U.S government securities and money market funds, as well as in investment-grade, interest-bearing securities.

43

ITEM 6. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

(a) EXHIBITS

EXHIBIT NUMBER	DESCRIPTION
10.1	Employment Letter Agreement, dated June 8, 2006, between TiVo Inc. and Steven J. Sordello.
10.2+	License and Distribution Agreement, dated as of August 22, 2006, between CoxCom, Inc. and TiVo Inc.
10.3+	Service Provider Amendment to TiVo Interactive Program Guide License Agreement, effective as of August 23, 2006, by and between Gemstar-TV Guide International, Inc. and TiVo Inc.
10.4+	Remote Scheduling Agreement to TiVo Interactive Program Guide License Agreement, effective as of August 23, 2006, by and between Gemstar-TV Guide International, Inc. and TiVo Inc.
31.1	Certification of Thomas S. Rogers, President and Chief Executive Officer of TiVo Inc. dated September 11, 2006 pursuant to Securities Exchange Act Rules 13a-14(a) and 15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Steven J. Sordello, Senior Vice President and Chief Financial Officer of TiVo Inc. dated September 11, 2006 pursuant to Securities Exchange Act Rules 13a-14(a) and 15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Thomas S. Rogers, President and Chief Executive Officer of TiVo Inc. dated September 11, 2006 in accordance with 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Steven J. Sordello, Senior Vice President and Chief Financial Officer of TiVo Inc. dated September 11, 2006 in accordance with 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

+ Confidential Treatment has been requested as to portions of this exhibit.

Trademark Acknowledgments

“TiVo,” the TiVo Logo, TiVo Smile Design, “TiVo Central,” “Can’t Miss TV,” “Ipreview,” the Jump Logo, “Personal Video Recorder,” “See it, want it, get it,” “TiVoMatic,” “TiVo, TV Your Way,” “TiVolution,” the Thumbs Up Logo, the Thumbs Down Logo, “What you want, when you want it,” and WishList are registered trademarks of TiVo Inc.

“Guru Guide,” “Active Preview,” “Home Media Option”, “Overtime Scheduler,” “Primetime Anytime,” “Season Pass”, “TiVoToGo”, “and TiVo Series2 (logo and text) are trademarks of TiVo Inc. All other trademarks or trade names appearing in this report are the property of their respective owners.

44

SIGNATURES

Pursuant to the requirements the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

	TIVO INC.
Date: September 11, 2006	By:	/s/ THOMAS S. ROGERS
		Thomas S. Rogers President and Chief Executive (Principal Executive Officer)
Date: September 11, 2006	By:	/s/ STEVEN J. SORDELLO
		Steven J. Sordello Senior Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)

45

EX-10.1

Exhibit 10.1

June 8, 2006

Dear Steve:

TiVo Inc. is pleased to offer you the position of Senior Vice President and Chief Financial Officer. You will be reporting to Tom Rogers, CEO.

Your compensation will be $290,000 per year, less payroll deductions and all required withholdings. You will be paid semi-monthly and you will be eligible for standard Company benefits. Most insurance benefits will be effective on your start date. In your position you will be a full time, exempt, Section 16 officer of the Company. You will be expected to devote your full business time to this position and not to render services for compensation outside of TiVo Inc., unless first approved by TiVo Inc.’s Chief Executive Officer.

The Board of Directors has approved a stock option grant of 450,000 shares, to be effective upon your start date, vested over 4 years with 25% on the first anniversary of your start date and the remaining shares vesting 1/36 per month over the following three years. The exercise price of your option grant will be the closing price of TiVo Inc.’s stock on the date you start employment.

In addition, the Board of Directors has approved a Restricted Stock grant of 15,000 shares, effective upon your vesting date and vesting in full on the one year anniversary of your hire date.

You will be eligible to participate in TiVo Inc.’s Employee Stock Purchase Plan, under the terms and conditions of the Plan, which allows you to purchase TiVo Inc. stock at 85% of the fair market value. We will provide further details and enrollment information after your start date. Please understand that this and all other TiVo Inc. benefits are subject to change, including discontinuation at TiVo Inc.’s discretion.

While employed at TiVo Inc., you will also be eligible to participate in the TiVo Executive Bonus Program, which is based on mutually agreed corporate, departmental, and individual objectives, as may be determined by the Board of Directors and/or the Compensation Committee. The bonus is scheduled to be paid annually at the end of each fiscal year. Our fiscal year ends in the month of January. Your annual bonus is targeted at 50% of your base salary.

In addition, you are eligible to participate in TiVo Inc.’s Executive Change in Control Agreement. This agreement provides for certain benefits in the event of a change in control of TiVo Inc. Nothing herein is intended to require that the Board of Directors approve or maintain a Change in Control Agreement for the benefit of TiVo Inc.’s key management personnel, or for your benefit. The Board of Directors has approved the following terms for you in the event of a Change in Control: one year of your base salary and targeted cash bonus incentive, paid in accordance with TiVo Inc.’s standard payroll practices, one year of group medical, life and disability insurance benefits, and 100% vesting of your stock option and restricted stock grants.

As a TiVo Inc. employee, you will be expected to abide by the Company rules and regulations, and sign and comply with the Company’s Code of Conduct and its Proprietary Information and Inventions Agreement, which prohibit unauthorized use or disclosure of TiVo Inc. proprietary information.

1

You may terminate employment with TiVo Inc. at any time and for any reason whatsoever simply by providing TiVo Inc. with not less than sixty (60) days prior written notice. Likewise, TiVo Inc. may terminate your employment at any time and for any reason, with or without cause or advance notice. This at-will employment relationship cannot be changed except in writing signed by a Company officer. Except as otherwise provided, upon termination of employment you shall not be entitled to receive any compensation or benefits other than your unpaid base compensation, if any, to the extent earned and due as of the date of termination.

This offer is contingent upon successful completion of your background check as determined by TiVo Inc. in its sole discretion.

The employment terms in this letter supersede any other agreements or promises made to you by anyone, whether written or oral, and cannot be changed except in writing signed by a Company officer. As required by law, this offer is subject to satisfactory proof of your right to work in the United States.

Please sign and date this letter, and return it to me by June 9, 2006 if you wish to accept employment at TiVo Inc. under the terms described above. If you accept the offer, we would like you to start your employment by mid-to-late August 2006. Please complete the enclosed TiVo application form and accompanying materials by providing us with all information not already included on your resume. We request that you sign the application and return it and all required materials along with your signed offer letter.

Sincerely,	ACCEPTED
/s/ Tom Rogers	/s/ Steven J. Sordello
Tom Rogers	Steven J. Sordello
DATE: 6/8/2006
	TENTATIVE START DATE: Mid to late August 2006
	DATE: 6/8/06

EX-10.2

Exhibit 10.2

Confidential treatment has been requested for portions of this exhibit. The copy filed herewith omits

the information subject to the confidentiality request. Omissions are designated as [*]. A complete

version of this exhibit has been filed separately with the Securities and Exchange Commission.

LICENSE AND DISTRIBUTION AGREEMENT

dated as of August 22, 2006

among

COXCOM, INC.

and

TIVO INC.

TABLE OF CONTENTS

	PAGE
SECTION 1.LICENSES	1
SECTION 2.OWNERSHIP AND RIGHTS IN INTELLECTUAL PROPERTY	5
SECTION 3.FEES	5
SECTION 4.PROMOTION COMMITMENT	9
SECTION 5.DEVELOPMENT	9
SECTION 6.CUSTOMER SUPPORT; COX MAINTENANCE AND SUPPORT	16
SECTION 7.ADVERTISING	17
SECTION 8.AUDIENCE RESEARCH SERVICES; COX SUBSCRIBER DATA	19
SECTION 9.REPORTS; AUDIT RIGHTS	21
SECTION 10.REPRESENTATIONS AND WARRANTIES	22
SECTION 11.INDEMNITIES	23
SECTION 12.LIMITATION OF LIABILITY	25
SECTION 13.PRESS RELEASE	26
SECTION 14.CONFIDENTIALITY	26
SECTION 15.TERM; TERMINATION RIGHTS; EFFECTS OF EXPIRATION OR TERMINATION	26
SECTION 16.GENERAL	28
EXHIBIT A – DEFINITIONS	A-1
EXHIBIT B –[*]END USER TERMS AND CONDITIONS	B-1
EXHIBIT C –[*]	C-1
EXHIBIT D –[*]BRANDING FOR TIVO-ENABLED STBS	D-1
EXHIBIT E – TIVO TRADEMARK USAGE GUIDELINES AND POLICIES	E-1
EXHIBIT F – COX MARKS	F-1
EXHIBIT G – COX TRADEMARK USAGE GUIDELINES AND POLICIES	G-1
EXHIBIT H –[*]PROCEDURES	H-1
EXHIBIT I – TAMS SOLUTION FUNCTIONALITY	I-1
EXHIBIT J – TE SOFTWARE FUNCTIONALITY	J-1
EXHIBIT K – CUSTOMER SUPPORT	K-1

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

-i-

TABLE OF CONTENTS

(CONTINUED)

	PAGE
EXHIBIT L – MAINTENANCE AND SUPPORT	L-1
EXHIBIT M – PRESS RELEASE	M-1
EXHIBIT N – QUALIFYING STB HARDWARE AND SOFTWARE CONFIGURATIONS	N-1
EXHIBIT O – ADVERTISING GUIDELINES	O-1

-ii-

LICENSE AND DISTRIBUTION AGREEMENT

This License and Distribution Agreement (the “Agreement”) is made effective as of August 22, 2006 (the “Effective Date”), by and between TIVO INC., a Delaware corporation, having its principal place of business at 2160 Gold Street, Alviso, California 95002 (“TiVo”) and COXCOM, INC., a Delaware corporation, having its principal place of business at 1400 Lake Hearn Drive, Atlanta, Georgia 30319 (“Cox”). Cox and TiVo may sometimes be individually referred to as a “Party” or collectively referred to as the “Parties”. Unless otherwise defined herein all capitalized terms shall have the meaning ascribed to them in Exhibit A, attached hereto and incorporated herein by this reference.

RECITALS

WHEREAS, TiVo and Cox desire to establish a limited strategic relationship specifically as detailed herein that provides Cox with

(i) a product featuring TiVo’s DVR Technology that is integrated with [*]provides Cox Subscribers with specified TiVo products and services[*], and

(ii) an interactive advertising solution for deployment across [*]Cox’s current and future platforms.

THEREFORE, the Parties, intending to be legally bound, hereby agree as follows:

SECTION 1. LICENSES.

1.1 TE Software License. Subject to the terms and conditions of this Agreement, TiVo hereby grants to Cox a royalty-bearing (as provided in SECTION 3), non-exclusive, non-transferable (except as expressly provided in Section 16.3 of this Agreement), non-sublicenseable (except as expressly provided in this Section 1.1) license [*]copy, use, display, license, and distribute (and have copied, used, displayed, licensed, and distributed on behalf of Cox including, without limitation, by Cox Systems), and sublicense to Cox TiVo Subscribers the right to use the TE Software (solely in object code form) only as incorporated in, and for use in conjunction with, TiVo-enabled STBs deployed to or used by Cox Cable Systems [*]; subject to the following restrictions and terms:

(a) the TE Software shall be distributed in TiVo-enabled STBs in executable form only and sublicensed by Cox for use by Cox TiVo Subscribers pursuant to end user terms and conditions[*];

(b) except as otherwise provided in Section 1.8, Cox shall not, and shall not authorize any third party to, attempt to reverse engineer, decompile, disassemble, or otherwise attempt to derive the source code from any TE Software provided by TiVo in executable code form, and shall not modify such executable code except in the course of its intended use (e.g., linking executable code with other components) without TiVo’s prior written consent;

(c) Cox shall not, and shall not authorize any third party to, obfuscate, alter or remove any of TiVo’s valid, commercially reasonable copyright or other proprietary rights notices or legends appearing on or in the TE Software in the form provided by TiVo, and all such markings shall be included on or in all copies made by Cox of any portion of such TE Software;

(d) Cox acknowledges that (i) the TE Software may incorporate, reference or require the use of certain Third Party IP [*] and

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

1.

(e) Cox shall be and remain responsible for any breach of the license rights granted pursuant to this Section 1.1 by any third party to whom Cox provides access to, or who is otherwise providing services to Cox relating to, the TE Software, and Cox shall not purport to grant any sublicenses or other rights under the TE Software that are inconsistent with the restrictions and terms of this Agreement. Notwithstanding the foregoing, Cox’s obligations with respect to any breach of the license rights granted pursuant to Section 1.1 by Cox to a Cox TiVo Subscriber [*]

1.2 TAMS License. Subject to the terms and conditions of this Agreement, TiVo, on behalf of itself and all TiVo Affiliates, hereby grants to Cox a royalty-free, non-exclusive, non-transferable (except as expressly provided in Section 16.3 of this Agreement), non-sublicenseable (except as expressly provided in this Section 1.2 of this Agreement), license [*]copy, use, display, license, and distribute (and have copied, used, displayed, licensed, and distributed on behalf of Cox including, without limitation, by Cox Systems), and sublicense to Cox TiVo Subscribers with applicable Qualifying STBs the right to use the TAMS Solution (solely in object code form) only as incorporated in, and for use in conjunction with,[*]; subject to the following restrictions and terms:

(a) any and all TAMS Solution software code incorporated in applicable Qualifying STBs or deployed in Cox Cable Systems shall be distributed in executable form only and sublicensed for use by Cox Subscribers pursuant to end user terms and conditions[*];

(b) except as otherwise provided in Section 1.8, Cox shall not, and shall not authorize any third party to, attempt to reverse engineer, decompile, disassemble, or otherwise attempt to derive the source code from any TAMS Solution provided by TiVo in executable code form, and shall not modify such executable code except in the course of its intended use (e.g., linking executable code with other components) without TiVo’s prior written consent;

(c) Cox shall not, and shall not permit any third party to, obfuscate, alter or remove any of TiVo’s valid, commercially reasonable copyright, patent or other proprietary rights notices or legends appearing on or in the TAMS Solution in the form provided by TiVo, and all such markings shall be included on or in all copies made by Cox of any portion of such TAMS Solution;

(d) Cox acknowledges that (i) the TAMS Solution may incorporate, reference or require the use of certain Third Party IP [*]; and

(e) Cox shall be and remain responsible for any breach of the license rights granted pursuant to this Section 1.2 by any third party to whom Cox provides access to, or who is otherwise providing services to Cox relating to, the TAMS Solution, and Cox shall not purport to grant any sublicenses or other rights under the TAMS Solution that are inconsistent with the restrictions and terms of this Agreement. Notwithstanding the foregoing, Cox’s obligations with respect to any breach of the license rights granted pursuant to Section 1.2 by Cox to a Cox Subscriber[*].

1.3 TiVo Remote. Subject to the terms and conditions of this Agreement, TiVo, on behalf of itself and all TiVo Affiliates, hereby grants to Cox a royalty-free, non-exclusive, non-transferable (except as expressly provided in 16.3 of this Agreement), non-sublicenseable, license under all of TiVo’s Intellectual Property Rights in, to and under the TiVo Remote to make, use, sell, and distribute (and have made, used, sold, and distributed on behalf of Cox including, without limitation, by Cox Systems), and sublicense to Cox TiVo Subscribers the right to use the TiVo Remote[*]:

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(a) Cox shall not, and shall not authorize any third party to, make, distribute, sell or use the TiVo Remote with any Cox Service except for use solely in conjunction with the TE Software operating on the TiVo-enabled STB;

(b) Cox shall make, or have made on Cox’s behalf, the TiVo Remote solely in strict accordance with the TiVo Remote Manufacturing Package;

(c) Cox shall not, and shall not permit any third party to, obfuscate, alter or remove any of TiVo’s valid copyright, patent or other proprietary rights notices or legends required to be included on the TiVo Remote in the form specified in the TiVo Remote Manufacturing Package, all such markings shall be included on all TiVo Remotes made by or for Cox, and no other markings shall be included on the TiVo Remote;

(d) Cox acknowledges that (i) the TiVo Remote may incorporate, [*] and

(e) Cox shall be and remain responsible for any breach of the license rights granted pursuant to this Section 1.3 by any third party to whom Cox provides access to, or who is otherwise providing services to Cox relating to, the TiVo Remote, and Cox shall not purport to grant any sublicenses or other rights relating to the TiVo Remote that are inconsistent with the restrictions and terms of this Agreement. Notwithstanding the foregoing, Cox’s obligations with respect to any breach of the license rights granted pursuant to Section 1.3 by Cox to a Cox TiVo Subscriber[*].

1.4 TiVo End User Documentation. Subject to the terms and conditions of this Agreement, TiVo, on behalf of itself and all TiVo Affiliates, hereby grants to Cox a[*] to and under the TiVo End User Documentation to reproduce and distribute to Cox TiVo Subscribers (and have reproduced and distributed to Cox TiVo Subscribers on behalf of Cox including, without limitation, by Cox Systems), the TiVo End User Documentation.

1.5 TiVo Marks. Subject to the terms and conditions of this Agreement, TiVo hereby grants to Cox a [*]the TiVo Marks solely for use in, or in reference to, the TE Software and the TiVo Remote; subject to the following restrictions and terms:

(a) Cox shall include[*] in related marketing materials as described in Section 4.6;

(b) Cox shall include the TiVo branding on the TiVo Remote as provided in the TiVo Remote Manufacturing Package;

(c) Cox shall use or display the TiVo Marks as permitted by this Section 1.5 only in compliance with TiVo’s trademark usage guidelines and policies attached hereto as Exhibit E, as the same may be reasonably modified from time to time by TiVo;

(d) before making use of any TiVo Marks, Cox shall submit a sample of the proposed use to TiVo [*]with respect to such use of the TiVo Marks including, in[*] remains substantially similar to the approved use with reasonable modifications for the specific media being utilized;

(e) Cox agrees that it shall not use the TiVo Marks in any marketing or promotion relating to any Cox products or services other than the TE Software or otherwise use the TiVo Marks in any manner that is not in accordance with TiVo’s trademark usage guidelines and policies referenced in Section 1.5(c); and

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(f) TiVo may terminate the licenses granted to Cox under this Section 1.5 in the event of (i) any unauthorized use of the TiVo Marks or other breach of this Agreement by Cox after thirty (30) days written notice to Cox, if Cox fails to cure any breach, or (ii) immediately upon written notice in the event of that Cox repeats any unauthorized use of the TiVo Marks or other breach of this Agreement.

1.6 Cox Marks. Subject to the terms and conditions of this Agreement, Cox hereby grants to TiVo a royalty-free, non-exclusive, non-transferable (except as expressly provided in Section 16.3 of this Agreement), non-sublicensable license to use and display the Cox Marks on Exhibit F solely for use in, or in reference to, the TE Software for marketing and advertising purposes; subject to the following restrictions and terms:

(a) TiVo shall use or display the Cox Marks as permitted by this Section 1.6 only in compliance with Cox’s trademark usage guidelines and policies attached hereto as Exhibit G, as the same may be reasonably modified from time to time by Cox; and

(b) before making use of any Cox Marks, TiVo shall submit a sample of the proposed use to Cox [*] with respect to such use of the Cox Marks[*], remains substantially similar to the approved use;

(c) TiVo agrees that it shall not use the Cox Marks in any marketing or promotion relating to any TiVo products or services other than the TE Software as offered by Cox or otherwise use the Cox Marks in any manner that is not in accordance with Cox’s trademark usage guidelines and policies referenced in Section 1.6(a); and

(d) Cox may terminate the licenses granted to TiVo under this Section 1.6 in the event of (i) any unauthorized use of the Cox Marks or other breach of this Agreement by TiVo after thirty (30) days written notice to TiVo, if TiVo fails to cure any breach, or (ii) immediately upon written notice in the event of that TiVo repeats any unauthorized use of the Cox Marks or other breach of this Agreement.

1.7 Patent Marking. Cox will ensure compliance with TiVo’s patent marking requirements for TiVo-enabled STBs, solely to the extent such requirements are consistent with applicable patent marking laws and are commercially reasonable. In addition, TiVo shall have the right to display in the “System Information” screen within the user interface of the TE Software patent numbers identified by TiVo[*]). TiVo shall be solely responsible for, and shall assume any and all liability associated with, [*] that Cox shall not assume any responsibility or liability in this regard. The inclusion of such patent numbers in [*] does not [*] by Cox of the applicability of the corresponding patents to any [*] or to any other [*].

1.8 [*] Escrow. After Cox Initial TE Acceptance and Cox Initial TAMS Acceptance, TiVo will place into [*] (as defined below) for any [*] accepted by Cox pursuant to SECTION 5 of this Agreement, and will additionally, from time to time hereunder, [*]. The agreement with such Escrow Agent (the “Escrow Agreement”) shall provide for [*] to Cox in the event of [*] that remains uncured [*] after receipt of written notice of [*], or (ii) commencement of a case under the [*] as now and hereafter in effect, or any successor statute, or any other applicable [*] now or hereafter in effect, or TiVo’s consent to the entry of an order for relief in an involuntary case, or to the conversion of a voluntary case to an involuntary case, under any such law, or TiVo’s consent to the appointment of or taking possession by a receiver, trustee or other custodian for all or a substantial part of its property, [*]. Upon release of the [*] Cox shall have the [*] to the extent necessary to support and maintain the TiVo Software (including engagement of [*] to perform such support and maintenance) distributed by or for Cox on TiVo-enabled STBs prior to the occurrence of such Releasing Event without any obligation to [*]; provided that such Source Code shall be subject to the Source Code Procedures set forth in Exhibit H and shall not be provided to any [*]. Cox shall give written notice by

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certified mail, overnight delivery service or hand delivery to the Escrow Agent and TiVo of the occurrence of a[*], specifying the circumstances of such occurrence in reasonable detail. The Escrow Agent shall provide for the [*]in accordance with the provisions of the Escrow Agreement. TiVo shall[*] of the escrow account. The Escrow Agreement shall provide that it is an agreement supplementary to this Agreement as provided in Section 365(n) of Title 11 of the United States Bankruptcy Code (the “Bankruptcy Code”) and that TiVo acknowledges that if TiVo as a debtor in possession or a trustee in bankruptcy in a case under the Bankruptcy Code rejects this Agreement or the Escrow Agreement, Cox may elect to retain its rights under this Agreement and the Escrow Agreement as provided in Section 365(n) of the Bankruptcy Code. For purposes of this Agreement, the term “Source Code” is defined as the [*]and any available related [*]necessary or useful for supporting and maintaining the[*] that was not previously provided to Cox.

SECTION 2. OWNERSHIP AND RIGHTS IN INTELLECTUAL PROPERTY.

2.1 TiVo Owned IP. As between the Parties, the TE Software, TAMS Solution, all Intellectual Property Rights in and to the foregoing and all Intellectual Property Rights in and to the TiVo Remote shall at all times remain the sole and exclusive property of TiVo, subject to the licenses expressly granted to Cox under this Agreement. All licenses and rights not expressly granted to Cox in this Agreement are reserved to TiVo.

2.2 Newly Developed IP.

(a) All new Intellectual Property Rights that are created by TiVo or a TiVo Affiliate (whether [*]with Cox, a Cox Affiliate, a Cox System or a Cox Vendor) [*]under this Agreement shall vest in and at all times remain the sole and exclusive property of[*]. [*], on behalf of itself and any such [*]hereby assigns to[*] any rights it may have in and to the foregoing.

(b) All new Intellectual Property Rights that are created by Cox, a Cox Affiliate, a Cox System or a Cox Vendor ([*]shall vest in and at all times remain the sole and exclusive property of[*], as applicable, and[*] shall not have any license or other rights therein.

(c) Each Party shall, at the request and expense of the other Party, at any time during or after the Term, sign all instruments and documents reasonably requested by the other Party, and otherwise cooperate with the other Party, to effectuate or evidence its rights to any and all such new Intellectual Property Rights.

(d) Notwithstanding any other provision of this Section 2.2, the Parties acknowledge and agree that if a Statement of Work requires the development of [*]that are not related to or based on any [*]existing as of [*]of such Statement of Work, the provisions of this Section 2.2 may be superseded and revised[*] as to the ownership interests and license rights in and to such new Intellectual Property Rights.

SECTION 3. FEES.

3.1 Subscriber Acquisition Commission. Cox shall pay to TiVo a commission (the “Subscriber Acquisition Commission”) for each [*]that becomes a Cox TiVo Subscriber [*](herein, a “[*] Subscriber”), as follows:

(a) As part of the marketing obligations described in SECTION 4, Cox will execute marketing campaigns (each a “[*]) targeted at [*]which advertise the availability of TiVo through Cox. Subject to the terms and conditions of Sections 1.1 and 1.5, Cox shall have [*]on bundling and licensing the TE Software to Cox TiVo Subscribers, including without limitation[*]. The [*]will commence in each Cox

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Market within [*]days after the date [*]is first made commercially available (excluding testing and beta releases) in such Cox Market as further described in Section 4.1 and, provided that TiVo has not breached its obligations under Sections 5.3 or 6.2 of this Agreement, shall be maintained in such market for a period of not less than [*]thereafter and will include jointly created and mutually agreed upon messaging.

(b) The amount of the Subscriber Acquisition Commission will be adjusted in accordance with the [*]purchased by the[*]. Cox will pay TiVo [*] who subscribes to [*]. Cox will pay TiVo [*]who subscribes to [*]. Cox will pay TiVo [*] who subscribes to [*].

(c) The commission owed to TiVo will accrue [*]over an [*]and is calculated by dividing the total applicable commission owed under Section 3.1(b) above by[*], and Cox’s obligation to pay the commission will [*]in the month that a[*]. For example, a [*]who purchases[*], but only [*]will result in a commission of approximately[*] to be paid to TiVo. As another example, a [*]who initially purchases [*]later reduces his/her subscription to [*]for the remainder of the [*]period, will result in a commission of approximately[*] for the first [*]and then [*]for the[*].

(d) Within [*]after the Effective Date, TiVo and Cox shall identify and agree in writing on a method to reliably track the number of[*].

(e) The [*]shall be subject to applicable laws, and Cox shall have the right to [*]in any applicable jurisdiction(s) if the Parties reasonably determine that any [*]may violate any such laws of such jurisdiction(s). Notwithstanding the foregoing, Cox shall have the right in its sole discretion to suspend any [*]in the event that it receives any formal complaint or other notice of an investigation or proceeding relating to the legality of such campaign. In the event of a suspension of any [*]pursuant to this Section 3.1(e), the Parties shall use reasonable commercial efforts to promptly modify and re-execute the[*] such that it no longer violates any such laws and/or addresses any other issues giving rise to the complaint, investigation or proceeding.

3.2 Monthly Fees. Each Cox System shall pay to TiVo a Monthly Fee for each commercially deployed TiVo-enabled STB, calculated in accordance with the following[*] (the “Monthly Fees”):

[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]

For the sake of clarity, the [*]in Monthly Fee applies only to those TiVo-enabled STBs within the given[*]. As an example, if during a given month Cox has a total of [*]TiVo-enabled STBs, the fee for the first[*] For the avoidance of doubt, the Monthly Fee remains the same during [*]Advertising and[*] Advertising.

3.3 Development Fees. Subject to the terms and conditions of this Agreement and the applicable Statement of Work, Cox shall also pay TiVo for all engineering work and material costs agreed to in writing by the Parties in each Statement of Work referenced in SECTION 5 in accordance with the payment milestones mutually agreed to in writing by the Parties (herein, “Development Fees”).

3.4 Cox Payments. Cox shall require that each Cox System with TiVo-enabled STBs [*]to pay the Subscriber Acquisition Commission in Section 3.1 and all Monthly Fees identified in Section 3.2 within [*]the month to which such obligations relate or in which such obligations accrue; provided that in no event shall such payment(s) be made more [*]after the end of such month. Undisputed milestone payments under Section 3.3 shall be paid by Cox within [*]after the [*]of the[*] of the deliverable or the date of[*], unless

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otherwise specified in the applicable Statement of Work. In addition, Cox agrees to pay any and all taxes, fees, excises duties or other governmental charges imposed on applicable payments made to TiVo under this Agreement, excluding any taxes based on TiVo’s income. If Cox [*] invoiced by TiVo, Cox shall promptly notify TiVo in writing of such [*] and shall work in good faith with TiVo to promptly resolve such[*]. Any amounts identified in an applicable invoice that are not the subject of such dispute shall be paid by Cox in accordance with this Section 3.4. All undisputed payments described in this SECTION 3 not received by TiVo by the applicable due date shall be deemed delinquent. Delinquent payments shall accrue interest at a rate of [*] per month or portion thereof (or, if lower, the maximum rate permitted by law) during the period that such payment remains delinquent.

3.5 TiVo National Advertising Revenue Share. The revenue share identified in Section 7.1(c)(iv) during [*] and in Section 7.2(c)(iv) during [*] for Net Revenue generated by TiVo shall be paid by TiVo within[*] days after the end of the calendar quarter in which such obligation accrues.

3.6 Payment Responsibility and Instructions. All amounts due to TiVo shall be paid by Cox or the Cox System, as applicable, in United States Dollars within the time frames specified herein. With respect to amounts to be paid directly by Cox Systems, Cox agrees that it shall cause each such Cox System to pay all undisputed amounts owed by such Cox System hereunder and that Cox shall remain responsible for each such payment until it is received by TiVo. All amounts due to Cox shall be paid by TiVo in United States Dollars within the time frames specified herein.

3.7 [*].

(a) If TiVo enters into a [*] with any other multi-channel video distributor that provides for a license [*] licensed to Cox under this Agreement (an “Alternate License Agreement”) and such other distributor has [*] (and has not breached such commitment) the TiVo Software, the terms and conditions set forth in this Section 3.7 shall apply. In the event that such Alternate License Agreement contains [*] that are more favorable to such other distributor in relation to the [*] as set forth in this Agreement, then, at[*], this Agreement shall be amended as described in this Section 3.7, effective [*] Agreement, such that Cox shall be entitled [*] applicable to each such more favorable[*] elected to be received by Cox (herein, a “MFN Amendment”).

(b) Within [*] after the effective date of any such Alternate License Agreement, TiVo shall prepare and provide to Cox a [*] of such Alternate License Agreement and a statement as to TiVo’s determination that such Alternate License Agreement [*]

(i) If TiVo determines that such Alternate License Agreement does trigger a MFN Amendment, there is [*] are, and the Parties determine that[*], at Cox’s election, this Agreement shall be automatically revised to incorporate such MFN Amendment without further action of the Parties and Cox shall thereafter be entitled to the benefit of the amended terms, conditions and fees.

(ii) If at any point in the MFN Amendment process set forth in this Section 3.7(b), [*] that Cox has elected to receive, the Parties shall resolve such issue pursuant to Section 16.6. If the Parties are unable to resolve the issue pursuant to Section 16.6, then either Party may submit such matter to binding arbitration solely for a determination as to [*]. Such arbitration will be resolved by a single arbitrator engaged in the practice of law and familiar with Delaware law, in accordance with the applicable rules of the American Arbitration Association (the “AAA”). Any judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. The Parties shall mutually agree upon the selection of an arbitrator. If the Parties are unable to mutually agree upon the selection of an arbitrator, the AAA will select the arbitrator. The arbitrator shall [*] and may order no other remedy or relief. Each Party

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shall bear its own costs and attorneys’ fees, and shall share equally in the fees and expenses of the arbitrator. The arbitration shall occur in [*]

(iii) If TiVo determines that such Alternate License Agreement [*] and the Parties determine that [*] consideration to TiVo as provided by the relevant[*]. In the event that the Parties are unable to agree upon terms and conditions to provide substantially[*], the Parties shall resolve such issue pursuant to Section 16.6. If the Parties are unable to resolve the issue pursuant to Section 16.6, then either Party may submit such matter to binding arbitration solely for a determination as to whether such [*]. Such arbitration will be resolved by a single arbitrator engaged in the practice of law and familiar with Delaware law, in accordance with the applicable rules of the American Arbitration Association (the “AAA”). Any judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. The Parties shall mutually agree upon the selection of an arbitrator. If the Parties are unable to mutually agree upon the selection of an arbitrator, the AAA will select the arbitrator. The arbitrator shall [*] and may order no other remedy or relief. Each Party shall bear its own costs and attorneys’ fees, and shall share equally in the fees and expenses of the arbitrator. The arbitration shall occur in [*].

(iv) If TiVo determines that such Alternate License Agreement [*] no further action shall be taken with regard to such Alternate License Agreement.

(v) If TiVo determines that such Alternate License Agreement [*] provided that Cox provides written notice to TiVo of [*] of receipt of the MFN Notice. If Cox does not provide TiVo with written notice [*], Cox will be deemed to have accepted TiVo’s determination and Section 3.7(b)(iii) above shall apply.

(1) If, as a result of [*] conducted hereunder, [*] shall promptly provide written notice to the Parties stating that the[*] an MFN Amendment and no further action shall be taken with regard to such Alternate License Agreement.

(2) If, however, the [*] then the [*] promptly commence good faith discussions with TiVo regarding whether the Alternate License Agreement[*] If, after such good faith discussions, the [*] shall promptly provide written notice to the Parties stating that a MFN[*] and no further action shall be taken with regard to such Alternate License Agreement.

(3) In the event that after such good faith discussions, the [*], then TiVo shall have the option, at TiVo’s sole election (to be exercised by giving written notice of its election to Cox [*] conclusion), to either (i) permit, [*] Under no circumstances, other than the limited circumstance set forth in clause (ii), above, shall any information acquired during the course of the [*] be disclosed to Cox by [*].

(c) All MFN[*], the provisions of the Alternate License Agreements, and any information relating to the foregoing shall be deemed the Confidential Information of TiVo and shall be subject to the provisions of SECTION 14 of this Agreement. This Section 3.7 shall not apply to any licenses to the TiVo Software granted in connection with any claim or litigation or any settlement thereof alleging that the TiVo Software infringes any Intellectual Property Rights of any third party or any licenses granted prior to the Effective Date. Any disputes as to whether this Section 3.7 applies to any license of the TiVo Software shall be resolved in accordance with Section 16.6.

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SECTION 4. PROMOTION COMMITMENT.

4.1 TE Software Deployment Commitment. Cox shall cause the[*]) to make the TE Software available within [*] after [*] as [*] by Cox (the “[*] Cox Market”). Within [*], the TE Software will be available to at least ninety percent (90%) of the [*] in Cox Cable Systems in the[*] Within[*] after the TE Software (and all other software required for functioning of the TE Software on Qualifying STBs) provides support for [*], Cox will make the TE Software available to at least ninety percent (90%) of the Qualifying STBs in Cox Cable Systems in Orange County, California if New England was elected as the [*] Cox Market or in [*] if [*] was elected as the [*] Cox Market (herein, the “[*] Cox Market”). Notwithstanding the foregoing, if Cox does not deploy [*] in the [*], Cox will make the TE Software available to at least[*] of the Qualifying STBs in Cox Cable Systems in such [*] Cox Market within [*] months after Cox Initial TE Acceptance. Cox’s commitments to deploy the TE Software in the Cox Cable Systems shall be subject to TiVo not breaching its obligations set forth in SECTION 6.

4.2 Subscriber Terms. Cox will be responsible for all marketing, distribution, [*] of the TE Software with regard to Cox Subscribers.

4.3 TiVo Launch Marketing Campaign. Upon the launch of the TE Software in each Cox System, Cox shall cause the relevant Cox System to promote and market the availability of the TE Software. During the Term, the TE Software shall be [*](i) the [*] that [*] DVR Technology, [*], implemented in a [*], or [*] executed by the applicable Cox System, and (ii) in any [*] that has express inclusion of [*] (implemented in[*]) as part of the terms [*] executed by the applicable Cox System; provided, however, that the [*] of all such marketing of the TE Software shall be [*], however, in no case will the TE Software be [*] than any other [*], product or service. TiVo will provide reasonable assistance to Cox in the design of the marketing messages and materials, but all[*] shall be born by Cox.

4.4 Call Scripts. Cox and TiVo will develop mutually agreeable scripts for use by[*] to describe and promote the TE Software.

4.5 Free Trial. Each Cox System, in it[*], may offer a [*] of the TE Software to Cox Subscribers who have a[*]; in which case TiVo [*] for the applicable boxes during such [*] period, not to exceed[*]. For the avoidance of doubt, during such [*] such Cox Subscribers shall not qualify for the [*] under Section[*].

4.6 Branding of Marketing Materials. Subject to the restrictions and terms of use set forth in Section 1.5, Cox will include [*] on all marketing and sales materials that refer to [*], including, without limitation, collateral/brochures, advertisements and retail merchandising.

SECTION 5. DEVELOPMENT.

5.1 TAMS Solution. Subject to the terms and conditions of this Section 5.1, TiVo shall develop and integrate the [*] with all [*] (including related servers and network infrastructure) pursuant to specifications to be documented in the Statement of Work for the[*]. It is the intent of the Parties that the version of the [*] deployed by Cox shall be substantially similar in functionality to the [*] as [*] for [*] (as generally described in [*] and to the extent that TiVo has all rights necessary to use such [*] in connection with[*]) with modifications (as specified in the [*] Statement of Work) to support integration with Cox specific requirements. Subsequent [*] Statements of Work may be executed by the Parties to incorporate new features and/or functionality to the TAMS Solution as further described in Section 5.3. The cost for [*] shall be documented in the applicable TAMS Statement of Work in accordance with [*] below.

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(a) Within [*] of execution of this Agreement, TiVo will, without cost to Cox, provide a [*] in such detail as Cox may reasonably request including, without limitation, such issues as[*], etc. to be used by Cox in developing the [*] Statement of Work.

(b) Following the Effective Date, Cox and TiVo shall use commercially reasonable efforts to develop the [*] Statement of Work as follows:

(i) Within [*] after the [*], each of Cox and TiVo shall appoint an individual to serve as project manager and principal contact with respect to such Party’s obligations under this Section 5.1 and shall notify the other Party of such appointment.

(ii) Within [*] of the Effective Date, TiVo shall prepare [*] of the [*] Statement of Work and deliver the same to Cox. Cox shall use its commercially reasonable efforts to give TiVo access to such technical information, employees and facilities of Cox and the appropriate Cox Vendors as is reasonably necessary to complete such [*] Statement of Work. Failure of Cox or any Cox Vendor to provide information reasonably requested by TiVo will be considered a [*].

(iii) Within [*] following delivery of such [*] of the[*] Statement of Work, Cox shall deliver to TiVo Cox’s comments to the [*] Statement of Work. Thereafter, the Parties shall negotiate in good faith to finalize such [*] Statement of Work.

(iv) The Parties shall finalize the [*] Statement of Work within [*] after the [*] (as extended pursuant to Section 5.4 for any Non-TiVo Delays) or by such later date as shall be mutually agreed in writing by the Parties’ respective project managers appointed pursuant to Section 5.1(b)(i). In the event that the [*] Statement of Work is completed within [*] after the [*], the [*] used to compute the [*] Solution under Section [*] will be[*]. If, notwithstanding the reasonable commercial efforts of both Parties, the [*] Statement of Work is [*] within [*] after [*] (as extended pursuant to Section [*] for any Non-TiVo Delays) or by such later date as mutually agreed in writing by the Parties’ Vice President level representatives, either Party shall [*], upon [*] to the other Party. Notwithstanding any other provision of this Section 5.1, TiVo shall be under no obligation to perform any development or design work relating to the TAMS Solution in advance of the completion of the [*] Statement of Work unless and until the Parties agree in writing on terms by which TiVo will be compensated for work it performs prior to the execution of the [*] Statement of Work.

(c) Each TAMS Statement of Work shall, at a minimum, provide for:

(i) detailed product requirements,

(ii) the software, hardware and development tools required to enable, operate and support the TAMS Solution;

(iii) amendments to the [*], required for such TAMS Statement of Work, provided, however, that with respect to any TAMS Statement of Work, TiVo shall notify Cox in advance of the execution of such Statement of Work of any [*] that will be required;

(iv) acceptance criteria (including features, functionality and interoperability) for Cox’s acceptance of any deliverables relating to the TAMS Solution;

(v) the total [*] required to complete the TAMS Solution and the [*] for the TAMS Solution calculated at[*] and an estimate of other expenses and costs for materials required to

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complete the TAMS Solution including, without limitation, any materials, equipment, licenses, support agreements, etc. that are necessary to complete the development and qualification work, all of the forgoing as specified in the TAMS Statement of Work;

(vi) specified [*] on which particular aspects of the TAMS Solution shall [*], which [*] shall be (x) designed to provide for [*] at reasonable intervals in the development process, and (y) [*] and adjustment by the Parties from time to time upon mutual written agreement if TiVo fails to achieve any milestone as a result of a Non-TiVo Delay or as reasonably necessary to accommodate any project change requests (each, a “PCR”) submitted by Cox;

(vii) the respective payments to be made by Cox to TiVo on each of [*], which payment amounts shall (x) reflect an [*] of the TAMS Solution Development Fee [*] execution of the TAMS Statement of Work, (y) reflect a [*] of the TAMS Solution Development Fee payable upon[*], as applicable, and (z) reflect [*] of the TAMS Solution Development Fee [*] on the [*] to in the TAMS Statement of Work that are commensurate with the [*] completed by the [*];

(viii) reporting obligations for TiVo to update Cox as to its progress under the TAMS Statement of Work, which reports shall be [*] at commercially reasonable [*]; and

(ix) detailed procedures for modification of the TAMS Statement of Work as evidenced in [*] which shall give such Party the right to [*] to the TAMS Statement of Work subject only to the Parties mutually agreeing in writing to such requested changes.

(d) Promptly following finalization of each TAMS Statement of Work in accordance with [*] above, each Party shall commence performance of its obligations thereunder and cooperate with the other Party in the performance of such obligations in good faith and in a commercially reasonable manner. In carrying out their respective obligations under each such Statement of Work, TiVo and Cox shall perform such obligations in a professional and workmanlike manner and comply with [*] set forth therein. In addition, [*] shall achieve all [*] specified therein and comply with all [*] contained therein (including, without limitation, those relating to the[*] thereof).

(e) Any deliverables relating to the TAMS Solution shall be delivered by TiVo and tested and accepted (or rejected) by Cox in accordance with the following procedures:

(i) TiVo shall deliver all such deliverables pursuant to the respective [*] specified in the applicable TAMS Statement of Work and provide [*] to Cox when each such deliverable is delivered.

(ii) In determining whether any such deliverable satisfies the [*] specified in the TAMS Statement of Work, Cox and TiVo shall follow the following procedures: Cox shall have the number of [*] in the TAMS Statement of Work for the applicable deliverable after delivery of each deliverable to [*] (herein, the [*]). Within such Acceptance Period, Cox shall use commercially reasonable efforts to perform such acceptance tests and communicate the results to TiVo. By the end of such Acceptance Period, Cox shall [*] that (x) the deliverable has [*] the applicable acceptance criteria, specifying in [*] of such [*], or (y) Cox accepts such deliverable. If Cox fails to notify TiVo within such Acceptance Period as[*], or if Cox distributes or otherwise uses the deliverable for commercial purposes, Cox shall be deemed to have accepted such deliverable. If Cox reports any failure with respect to a deliverable, [*] such failure [*] number of [*] in the TAMS Statement of Work for the applicable deliverable after the [*] of Cox’s notice of [*] and deliver to Cox a [*] of such deliverable. Upon delivery of [*] of a

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deliverable, the foregoing procedures shall be repeated until such deliverable has been accepted by Cox or [*]pursuant to Section[*] below.

(iii) If there occurs a dispute regarding whether any such [*]the applicable[*] specified in the TAMS Statement of Work (including following any attempts by TiVo to [*]any such deliverable), Cox and TiVo shall promptly communicate such dispute to the appropriate business/project manager when such Party becomes aware of the dispute. If such dispute cannot be mutually resolved by such business/project managers within [*]from the time the business/project managers begin discussions, then either Party may [*]the matter to [*]procedures set forth in Section[*].

(iv) If, notwithstanding the reasonable commercial efforts of both Parties, the Release of the TAMS Solution being developed under the applicable TAMS Statement of Work is [*]in accordance with this [*]after the date of the [*]set forth in such applicable TAMS Statement of Work (as [*]pursuant to[*] for any Non-TiVo Delays), or by such later date as mutually agreed in writing by the Parties’ respective Vice President level representatives, either Party shall[*] written notice to the other Party, [*]and all[*] thereunder. In the event of[*], TiVo shall be entitled to [*]under such TAMS Statement of Work pursuant to this[*]; provided that the next Statement of Work entered into by the Parties shall be subject [*]on the amounts to be paid by Cox to TiVo until acceptance of the [*]under such Statement of Work. If the [*]TAMS Statement of Work and[*] TAMS Solution development efforts are [*]pursuant to this[*] of the Agreement, and all other Sections as related to the TAMS Solution or TAMS Statement of Work, shall immediately[*], and SECTION 16 as related to the work performed for such Initial TAMS Solution. For the avoidance of doubt, if any subsequent TAMS Statement of Work is [*]pursuant to this Section 5.1(e)(iv), such [*]such TAMS Statement of Work and the development efforts thereunder and such [*]shall not affect any of the rights or obligations of the Parties relating to prior Releases of the TAMS Solution or any future TAMS Statements of Work executed by the Parties.

(f) In consideration for the development of the TAMS Solution, Cox shall pay TiVo [*]as shall be set forth in the applicable TAMS Statement of Work (subject to any changes thereto in accordance with the PCR procedures specified therein). The aggregate amount required to be paid by Cox to TiVo pursuant to each such TAMS Statement of Work (subject to any such changes) shall be referred to herein as the “TAMS Solution Development Fee.” Except as expressly set forth in this Section 5.1, with respect to work performed under each TAMS Statement of Work, [*]specified in such TAMS Statement of Work and there shall be [*]or rates concerning[*] and second or third [*]unless specified in such TAMS Statement of Work. All authorization concerning payment by Cox for [*]shall be specified in the TAMS Statement of Work. In the event of any Cox caused delays, Cox shall be responsible for[*], if any, to the extent that (i) the [*]causing; (ii) TiVo has provided Cox with reasonable notice of such[*]; and (iii) TiVo has used reasonable efforts to mitigate the impacts of such[*].

5.2 TE Software. Subject to the terms and conditions of this Section 5.2, TiVo shall develop and integrate [*]with the [*]for Cox pursuant to specifications to be documented in the Statement of Work for the [*](the “[*]Statement of Work”). It is the intent of the Parties that the version of the [*]deployed by Cox shall be substantially similar in functionality to the TE Software TiVo is developing for [*]as generally described in Exhibit J and to the extent that TiVo has all rights necessary to use such [*]in connection with[*]) with modifications (as specified in the[*] Software Statement of Work) to support integration with Cox specific requirements. Subsequent TE Software Statements of Work may be executed by the Parties to incorporate new features and/or functionality to the TE Software as further described in Section 5.3. [*] and TiVo execute a statement of work to[*] but will be required to fund any additional work or materials required to modify, qualify, or operate the TE Software in the applicable Cox Systems.

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

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(a) Following the Effective Date, Cox and TiVo shall use commercially reasonable efforts to develop the [*] Software Statement of Work as follows:

(i) Within [*] after the [*], each of Cox and TiVo shall appoint an individual to serve as project manager and principal contact with respect to such Party’s obligations under this Section 5.2 and shall notify the other Party of such appointment.

(ii) Within [*] of the [*], TiVo shall prepare a [*] of the [*] Software Statement of Work and deliver the same to Cox. Cox shall use its commercially reasonable efforts to give TiVo access to such technical information, employees and facilities of Cox and the appropriate Cox Vendors as is reasonably necessary to complete such preliminary version of the [*] Statement of Work. Failure of Cox or any Cox Vendor to provide information reasonably requested by TiVo will be considered a [*].

(iii) Within [*] following delivery of such [*] version of the [*] Software Statement of Work, Cox shall deliver to TiVo its comments to the [*] Software Statement of Work. Thereafter, the Parties shall negotiate in good faith to finalize such [*] Statement of Work.

(iv) The Parties shall finalize the [*] Software Statement of Work within [*] after the [*] (as extended pursuant to Section 5.4 for any Non-TiVo Delays) or by such later date as shall be mutually agreed in writing by the Parties’ respective project managers appointed pursuant to Section 5.2(a)(i). In the event that the [*] Software Statement of Work is completed within [*] after the [*], the [*] used to compute the [*] Software under Section [*] will be [*]. If, notwithstanding the reasonable commercial efforts of both Parties, the [*] Software Statement of Work is [*] within [*] (as extended pursuant to Section 5.4 for any Non-TiVo Delays) or by such later date as mutually agreed in writing by the Parties’ respective Vice President level representatives, either Party shall [*], upon [*] to the other Party. Notwithstanding any other provision of this Section 5.2, TiVo shall be under no obligation to perform any development or design work relating to the TE Software in advance of the completion of the [*] Software Statement of Work unless and until the Parties agree in writing on terms by which TiVo will be compensated for work it performs prior to the execution of the [*] Software Statement of Work.

(b) Each TE Software Statement of Work shall, at a minimum, provide for:

(i) detailed product requirements, which may include, without limitation, user interface customizations, product co-branding, and other modifications for fully compatible deployment on a TV Navigator middleware platform, unless otherwise specified in the TE Software Statement or Work, and to ensure compatibility with the appropriate Cox Cable Systems and Qualifying STBs;

(ii) the software, hardware and development tools required to enable, operate and support the TE Software;

(iii) amendments to the [*], required for such TE Software Statement of Work, provided, however, that with respect to any TE Software Statement of Work, TiVo shall notify Cox in advance of the execution of such Statement of Work of any[*] that will be required;

(iv) integration of the TE Software with the appropriate Cox Headend system software providing for billing, conditional access and parental controls;

(v) acceptance criteria (including features, functionality and interoperability) for Cox’s acceptance of any deliverables relating to the TE Software;

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

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(vi) the total number of [*]to complete the TE Software and the [*]for the TE Software calculated at[*] and an estimate of other expenses and costs for materials required to complete the TE Software including, without limitation, any materials, equipment, licenses, support agreements, etc. that are necessary to complete the development and qualification work, all of the foregoing as specified in the TE Software Statement of Work;

(vii) specified[*] on which particular aspects of the TE Software[*], which[*] shall be (x) designed to provide for [*]at reasonable intervals in the development process, and (y) [*]and adjustment by the Parties from time to time upon mutual written agreement if TiVo fails to achieve any milestone as a result of a Non-TiVo Delay or as reasonably necessary to accommodate any PCRs submitted by Cox;

(viii) the respective payments to be made by Cox to TiVo on each of [*]which payment amounts shall (x) reflect [*]of the TE Software Development Fee[*] execution of the TE Software Statement of Work, (y) reflect a [*]of the TE Software Development Fee payable[*] as applicable, and (z) reflect [*]in accordance with the [*]agreed to in the TE Software Statement of Work that are commensurate with the [*]completed by the[*];

(ix) reporting obligations for TiVo to update Cox as to its progress under the TE Software Statement of Work, which reports shall be [*]at commercially reasonable[*]; and

(x) detailed procedures for modification of the TE Software Statement of Work as evidenced in a[*], which shall give such Party the right to[*] to the TE Software Statement of Work subject only to the Parties mutually agreeing in writing to such requested changes.

(c) Promptly following finalization of each TE Software Statement of Work in accordance with [*]above, each Party shall commence performance of its obligations thereunder and cooperate with the other Party in the performance of such obligations in good faith and in a commercially reasonable manner. In carrying out their respective obligations under each such TE Software Statement of Work, TiVo and Cox shall perform such obligations in a professional and workmanlike manner and comply with their [*]set forth therein. In addition, [*]shall achieve all [*]specified therein and comply with all [*]contained therein (including, without limitation, those relating to the[*] thereof).

(d) Any deliverables relating to the TE Software shall be delivered by TiVo and tested and accepted (or rejected) by Cox in accordance with the following procedures:

(i) TiVo shall deliver all such deliverables pursuant to the respective [*]specified in the applicable TE Software Statement of Work and provide [*]to Cox when each such deliverable is delivered.

(ii) In determining whether any such deliverable satisfies the [*]specified in the TE Software Statement of Work, Cox and TiVo shall follow the following procedures: Cox shall have the applicable [*]specified in the TE Software Statement of Work for the applicable deliverable. Within such Acceptance Period, Cox shall use commercially reasonable efforts to perform such [*]and communicate the results to TiVo. By the end of such Acceptance Period, Cox shall [*]that (x) the deliverable has [*]the applicable acceptance criteria, specifying in [*]of such[*], or (y) Cox accepts such deliverable. If Cox fails to notify TiVo within such Acceptance Period as to[*], or if Cox distributes or otherwise uses the deliverable for commercial purposes, Cox shall be deemed to have been accepted such deliverable. If Cox reports any failure with respect to a deliverable, TiVo [*]such failure [*]specified in the TE Software Statement of Work for the applicable deliverable after the[*] of Cox’s notice of [*]and deliver

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

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to Cox a[*] of such deliverable. Upon delivery of a [*]of a deliverable, the foregoing procedures shall be repeated until such deliverable has been accepted by Cox or [*]pursuant to Section[*] below.

(iii) If there occurs a dispute regarding whether any such [*] specified in the TE Software Statement of Work (including following any attempts by TiVo to [*]any such deliverable), Cox and TiVo shall promptly communicate such dispute to the appropriate business/project manager when such Party becomes aware of the dispute. If such dispute cannot be mutually resolved by such business/project managers within [*]from the time the business/project managers begin discussions, then either Party may [*]the matter to the [*]procedures set forth in Section[*] below.

(iv) If, notwithstanding the reasonable commercial efforts of both Parties, the Release of the TE Software being developed under the applicable TE Software Statement of Work is [*]in accordance with this [*]after the date of the [*]set forth in such applicable TE Software Statement of Work (as [*]pursuant to Section[*] for any Non-TiVo Delays), or by such later date as mutually agreed in writing by the Parties’ respective Vice President level representatives, either Party shall [*]written notice to the other Party:[*]. In the event of either such[*], TiVo shall be entitled to [*]for such TE Software pursuant to this[*]; provided that the next Statement of Work entered into by the Parties shall be subject [*]on the amounts to be paid by Cox to TiVo until acceptance of the [*]under such Statement of Work.

(e) In consideration for the development of the TE Software, Cox shall pay TiVo such [*]as shall be set forth in the applicable TE Software Statement of Work (subject to any changes thereto in accordance with the PCR procedures specified therein). The[*] to be paid by Cox to TiVo pursuant to each such TE Software Statement of Work (subject to any such changes) shall be referred to herein as the “TE Software Development Fee.” Except as expressly set forth in this Section 5.2, with respect to work performed under each TE Software Statement of Work, the [*]specified in such TE Software Statement of Work and there shall be no [*]or rates concerning[*] and second or third [*]unless specified in such TE Software Statement of Work. All authorization concerning payment by Cox for [*]shall be specified in the TE Software Statement of Work. In the event of any Cox caused delays, Cox shall be responsible for[*], if any, to the extent that (i) the [*]causing; (ii) TiVo has provided Cox with reasonable notice of such[*]; and (iii) TiVo has used reasonable efforts to mitigate the impacts of such[*].

5.3 Future Features Development.

(a) During the [*]and subject to the Parties execution of applicable Statements of Work, TiVo will make available to Cox [*]and the[*], if and when such subsequent [*]are developed by TiVo, to: (i) incorporate [*]developed by TiVo for [*]that are made commercially available during the[*] (to the extent that TiVo has[*] to use such software or materials in connection with [*]customers); and (ii) incorporate [*]developed by TiVo that are made commercially available during the Term (to the extent that TIVo has all [*]necessary to provide such features to Cox). All such subsequent [*] shall be provided to Cox at[*], except for any [*]that are directly attributable to the [*]such new [*] with the Qualifying STBs or the Cox Cable Systems, which testing and/or integration fees shall be as set forth pursuant to a TAMS Statement of Work or TE Software Statement of Work, as further described in Sections 5.1 and 5.2, respectively and in compliance with Section 6.2(a). For the avoidance of doubt, such [*]of the TE Software that incorporate only new [*]as described in (ii) above, shall [*]the [*]to be paid by Cox pursuant to Section[*].

(b) On an [*]basis, the Parties agree to consider and negotiate in good faith any [*]in the[*] specified in Section[*] to be paid to TiVo, in exchange for [*]to be performed by[*]. Any such adjustments in the [*]and additional[*] must be agreed to in writing by authorized representatives of each Party, prior to creating any changed or additional obligations on the Parties.

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

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5.4 Notice and Effect of Delay.

(a) In any case in which TiVo believes that a[*] in a Statement of Work (or the[*] of any version of the Statement of Work itself) shall be extended or delayed due to a [*]to any[*] action, inaction, or omission by Cox, any Cox Affiliate or any other Cox Vendor (other than TiVo, TiVo Affiliates, or TiVo vendors) (each such case, a “Non-TiVo Delay”), TiVo shall (i) promptly document such[*], (ii) provide Cox with prompt written notice (which shall in any event be delivered to Cox [*]of TiVo becoming aware of such[*]) of TiVo’s understanding regarding the reasons for such delay and the anticipated consequences of such[*], and (iii) use commercially reasonable efforts to mitigate the impact of any such[*]; provided that such efforts do not result in[*]. It is understood that the Parties must agree in good faith as to any[*]. In the event of any dispute regarding an [*]hereunder, the Parties shall first attempt to resolve such dispute pursuant to the [*]procedures set forth in[*].

(b) In the event any [*]occurs, all remaining milestones will be [*]a day-for-day basis by the length of the[*]. In addition, if a [*]Non-TiVo Delay causes TiVo to [*]pursuant to a Statement of Work, Cox shall pay to TiVo an amount [*]would have been paid had such [*]or (ii) the [*]of all TiVo work performed pursuant to the Statement of Work in its efforts to achieve [*]and for which TiVo has not previously been paid (such amount to be paid based upon the billing procedures set forth in the applicable Statement of Work), and Cox shall pay any balance of the [*]upon the achievement of such[*]. Notwithstanding the foregoing, nothing in this Section 5.3(b) shall waive any rights or remedies of Cox under this Agreement, including the right to recover any payments already made, in the event that [*]to achieve such milestone after allowance for such Non-TiVo[*].

SECTION 6. CUSTOMER SUPPORT; COX MAINTENANCE AND SUPPORT.

6.1 Customer Support. [*]shall be responsible for answering and responding to all Cox Subscriber calls and for providing all technical support to Cox TiVo Subscribers relating to the[*]. TiVo shall provide [*]as further described on[*] that are designed to, at a minimum, enable [*]such support to Cox TiVo Subscribers. Upon Cox commercial deployment of the TiVo Software, TiVo will make available solely to Cox (as opposed to Cox’s customers) TiVo support resources via [*]for escalation of unresolved technical issues with the TE Software, as further described on [*]subject to Cox reimbursing TiVo for the cost of providing such support up to a maximum of[*]. TiVo will waive the TiVo Support fee in any year in which there are an average of more than[*]. For the avoidance of doubt, TiVo’s support role is restricted to interaction with technical representatives from Cox.

6.2 Maintenance and Support.

(a) Upon Cox commercial deployment of the TiVo Software, TiVo shall provide to Cox [*]as described in[*], which services shall be provided during the Term for[*]. TiVo acknowledges and agrees that, it shall not, as part of its [*]services or otherwise, modify the TE Software, TAMS Solution, or any other TiVo Software provided to Cox Subscribers or make any changes to the functionality or operation of such TiVo Software, without[*].

(b) TiVo will provide the [*]described in[*] in relation to any particular TiVo Release for up to[*], regardless of whether TiVo makes subsequent Releases available. Without limiting the foregoing, TiVo will support[*] of the TE Software and TAMS Solution.

(c) As part of its[*], during the Term of this Agreement and subject to the Parties execution of applicable Statements of Work, TiVo will make available to Cox subsequent Releases of the TE Software and TAMS Solution that are [*]of such TiVo Software with future releases of the [*]and for

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

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integration and testing of the TiVo Software with the Cox Systems. Such [*]of the TAMS Solution and TE Software shall be implemented pursuant to a TAMS Statement of Work or TE Software Statement of Work, as further described in Sections 5.1 and 5.2, respectively, or as an amendment to an existing Statement or Work, and in compliance with Section 6.2(a); provided that the Parties may mutually agree in writing to waive the requirement for such a Statement of Work or amendment thereto. The [*]with the Qualifying STBs or the Cox Cable Systems as is necessary for the implementation of any [*]of the TAMS Solution or TE Software shall be paid by[*]. For the avoidance of doubt, the use by Cox of such new Releases shall not [*]to be paid by Cox pursuant to Section[*].

6.3 Roadmaps. TiVo and Cox will meet at least [*]to share and discuss future[*] plans and features. Such roadmap discussions shall include key executives of both Parties and all information exchanged in the meeting shall be subject to the confidentiality obligations under SECTION 14.

6.4 Documentation. TiVo will provide Cox with all Documentation created by TiVo from [*]for the deployment, [*] and[*] of the TE Software and TAMS Solution, including without limitation all Documentation required to[*] Except as set forth in the applicable Statement of Work, nothing in this Section 6.4 shall require TiVo to create any Documentation not otherwise created in the ordinary course.

SECTION 7. ADVERTISING.

7.1 Phase 1 Advertising. Phase 1 Advertising shall apply to[*], as further described in this Section 7.1 and shall continue solely as to [*]unless[*] proceed with Phase 2 Advertising as described in Section 7.2 below.

(a) TAMS Solution Deployment. Following Cox Initial TAMS Acceptance, Cox will enable the TAMS Solution on [*]in accordance with the terms of this Agreement. Unless otherwise agreed by the Parties in writing, Cox is not authorized to enable the TAMS Solution on any TiVo-enabled STBs[*].

(b) Cox Sale of Advertising. Subject to technical limitations, Cox will have the [*] STBs, without[*]. Cox will[*] of the revenue generated by it from the sale of such advertising. For the avoidance of doubt, Cox will not have any rights [*]on any[*] or other products that are not[*].

(c) TiVo Sale of Advertising. Subject to technical limitations, TiVo will have the right to sell [*], in accordance with the following:

(i) Subject to the [*]on deployed TiVo-enabled STBs that has [*], as determined by Cox, TiVo will [*]of STB Storage Space to be used[*] with respect to each TiVo-enabled STB. If technical limitations cause the [*]on a TiVo-enabled STB to be[*], Cox will allow TiVo to[*].

(ii) Upon mutual agreement of the parties, for new [*]to be deployed or deployed[*] that have sufficient [*]that has previously been[*], the STB Storage Space allocated to[*] be increased over time to accommodate higher bandwidth video standards such that [*]of the video content capable of being stored remains substantially similar (regardless of the prevailing video standard) to the [*]of being stored in the[*].

(iii) Cox shall provide TiVo with sufficient bandwidth to perform [*]of the advertising content on the storage allocated to TiVo in (a) and (b) above. Subject to commercially reasonable technical capacity, Cox shall also support any [*]of TAMS on Cox’s network in accordance with the specifications mutually agreed to by the Parties in the TAMS Statement of Work.

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

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(iv) TiVo will [*]of the Net Revenue generated by it from the sale of[*]. Cox will [*]of Net Revenue for all such[*] sold by TiVo. In all cases, the basis for any revenue shared with Cox shall be equal to the [*](based on Cox TiVo Subscribers [*]the ad, regardless of whether such subscriber [*]the advertisement) portion of [*]by TiVo that is attributable to the distribution of the ad to Cox TiVo Subscribers.

(v) TiVo will sell [*]for TAMS-enabled Advertising on the[*]. In addition and without limitation, any TiVo advertising shall comply with the advertising guidelines (“Advertising Guidelines”) set forth in [*]as may be reasonably amended by mutual written agreement of the Parties from time to time. The sale of advertising by TiVo shall be conducted on a [*]basis.

(vi) Each video clip in any Showcase Video Repository shall not [*]and the [*] video contained in any given Showcase Video Repository shall[*].

(vii) TiVo shall not sell or otherwise distribute any [*]other than through the[*]. Without limiting the foregoing or any other terms or conditions set forth herein, TiVo shall not access, or embed in, any [*]provided to a Cox Subscriber any [*]that is not an [*]through the TAMS Solution in accordance with the terms and conditions set forth herein. In addition, TiVo will not sell or embed any [*]on any Cox [*]other than[*] expressly permitted under this Agreement.

7.2 Phase 2 Advertising. Within [*]after Cox has enabled the TAMS Solution on [*]deployed in the [*], upon written notice to TiVo, to [*]with Phase 2 Advertising. Upon such [*]and at Cox’s[*], the Parties shall enter into good faith negotiations regarding the terms and conditions applicable to[*]. If the Parties agree on such terms, this Agreement shall be amended in accordance with Section 16.2 to incorporate such terms. If within [*]of such written request the Parties are unable to agree on such terms, Cox [*]under the terms and conditions of this Section 7.2; or (ii) continue with [*]Advertising under the terms and condition of Section 7.1. Upon the date of such written notice confirming Cox’s [*]Advertising under the following terms, the provisions of Section 7.1 relating to[*] will be superseded in their entirety by the provisions of this Section 7.2.

(a) TAMS Solution Deployment. Upon Cox’s election to proceed under [*], Cox will enable the TAMS Solution on all [*](subject to technical limitations) deployed[*], in accordance with the terms of this Agreement, including those deployed by Cox [*]of such election, prior to commercial deployment of the TE Software for use on any [*]in such Cox System(s). For the avoidance of doubt, [*]to deploy the TAMS Solution on a Cox[*]; provided that the TAMS Solution is always deployed in each Cox System in which the TE Software is commercially deployed.

(b) Cox Sale of Advertising. Subject to technical limitations, Cox will have the [*] to TiVo. Cox will[*] of the revenue generated by it from the sale of such advertising.

(c) TiVo Sale of Advertising. Subject to technical limitations, TiVo will have the right to sell [*]on all[*], in accordance with the following:

(i) Subject to the [*]on deployed [*]that has previously been[*], as determined by Cox, TiVo will be [*] to be used [*]with respect to each Qualifying STB. If technical limitations cause the available storage space on a[*], Cox will allow TiVo to use[*].

(ii) Upon mutual written agreement of the parties, for [*]to be deployed or deployed [*]that has previously been[*] allocated to TiVo for TAMS-enabled Advertising may be

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

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increased [*]such that the [*]capable of being stored remains substantially similar (regardless of the prevailing video standard) to the amount capable of being stored[*].

(iii) Cox shall provide TiVo with sufficient bandwidth to [*]of the advertising content on the [*]in (i) and (ii) above. Subject to commercially reasonable technical capacity, Cox shall also support any [*]required for the functionality of TAMS on Cox’s network in accordance with the specifications mutually agreed to by the Parties in the TAMS Statement of Work.

(iv) TiVo will [*]of the Net Revenue generated by it from the sale of [*]. Cox will [*] for all such[*] sold by TiVo. In all cases, the basis for any revenue shared with Cox shall be equal to the[*], regardless of whether the user of such [*]actually [*]the advertisement) portion of[*] by TiVo that is attributable to the distribution of the ad to Cox Subscribers.

(v) TiVo will [*]of the Net Revenue generated by it from the sale of [*]on TiVo[*].

(vi) TiVo will [*]for TAMS-enabled Advertising on the[*]. In addition and without limitation, any TiVo advertising shall comply with the advertising guidelines (“Advertising Guidelines”) set forth in Exhibit O as may be reasonably amended by mutual written agreement of the Parties from time to time. The sale of advertising by TiVo shall be [*]

(vii) Each [*]in any Showcase Video Repository shall[*] and the [*]of [*]video contained in any given Showcase Video Repository shall [*]

(d) TiVo shall not sell or otherwise distribute[*] other than through the TAMS Solution. Without limiting the foregoing or any other terms or conditions set forth herein, TiVo shall not access, or embed in, any Cox STB provided to a Cox Subscriber any advertisement that is not an advertisement distributed through the TAMS Solution in accordance with the terms and conditions set forth herein. In addition, TiVo will not sell or embed any advertising on any Cox STB other than advertising expressly permitted under this Agreement.

7.3 Additional Provisions Relating to Advertising.

(a) TiVo and Cox shall each have equal access to[*] that would[*]. Such[*] shall be placed in selected prominent [*]in the[*], as further specified in the TAMS Statement of Work. Cox and TiVo sold advertising shall be displayed from a [*]in a[*] manner or in such other manner as results in [*]exposure for each advertisement in the[*].

(b) TiVo shall make available to Cox at [*]up to [*]of reasonable advertising sales support and education on the use and functionality of the TAMS Solution, as mutually agreed to in writing by the Parties. Such sales support and education shall be used by Cox[*] the initial deployment of the TAMS Solution.

SECTION 8. AUDIENCE RESEARCH SERVICES; COX SUBSCRIBER DATA.

8.1 Cox Subscriber Data. [*]shall own and control all [*]Data, including all [*]Data that is received, derived or otherwise collected from the TE Software or the TAMS Solution. TiVo shall have the [*]to [*]and[*] Data solely in the manner expressly set forth in this SECTION 8.

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

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8.2 TiVo’s Use of Cox Subscriber Data in [*]Form. Provided that TiVo supplies Cox, [*], with software necessary to extract such data from[*]), and subject to the terms of this SECTION 8, Cox shall provide TiVo with access to [*]Data [*] so as to incorporate such information into future product planning and development. Any such access to or use of the Cox Subscriber Data by [*]pursuant to this Section 8.2 shall (A) be subject to compliance with all applicable laws and Cox’s then applicable privacy policy relating to the collection and use of such Cox Subscriber Data, and (B) allow for access and use [*]as that term is defined below). Access to Cox Subscriber Data by TiVo pursuant to this Section 8.2 shall be accomplished through [*]upon in advance by the parties in writing. In addition, TiVo [*]identified as data derived from Cox or its Affiliates or reflecting the use of TAMS-enabled advertising or the TE Software by Cox Subscribers [*]from such usage data collected from other TiVo Users; nor shall any[*], whether in audience research reports or otherwise, permit any third party, directly or indirectly, to [*]any information as having[*] from Cox Subscriber Data.

8.3 TiVo’s Use of Cox Subscriber PII. TiVo shall [*]any Cox Subscriber PII without the[*] consent of Cox for each such access or use, and any access to or use of any Cox Subscriber PII shall be subject to[*] shall require in writing in advance from time to time; provided that [*]written consent shall not be unreasonably withheld or delayed and that any such required policies and procedures shall be applied to [*]access or use solely on a fair, reasonable and non-discriminatory basis. Notwithstanding the foregoing, [*]consent to the access or use of any Cox Subscriber PII pursuant to such policies and procedures shall constitute consent to the continued access and use by [*]purposes pursuant to the same policies and procedures, unless [*]notifies [*]in writing with respect to any changes to such policies and procedures. In addition, [*]agrees to use commercially reasonable efforts to respond with its consent, or its withholding of consent, to any request by [*]to access or use any Cox Subscriber PII within[*]. For purposes of this Agreement, Cox Subscriber PII shall mean any Cox Subscriber Data that includes any “personally identifiable information” pertaining to a Cox Subscriber, including any information (i) that identifies or can be used to identify, contact, or locate the subscriber to whom such information pertains, or (ii) from which identification or contact information of an individual person can be derived. Cox Subscriber PII includes, but is not limited to: name, address, phone number, account number, viewing information, user names, passwords, fax number, email address, financial profiles, medical profile, social security number, and credit card information. Cox Subscriber PII further includes information that, when associated with other information, such as, but not necessarily limited to, a personal profile, unique identifier, biometric information, IP address, CM MAC address, CPE MAC address or TiVo unit identifier, could be used to derive the identity of a Cox Subscriber. Notwithstanding the foregoing, Cox Subscriber PII does not include information that is anonymous or aggregate and accordingly is not capable of being used to identify an individual Cox Subscriber.

8.4 Handling of Cox Subscriber Data. TiVo agrees that pursuant to the subscriber privacy provisions of the Cable TV Privacy Act of 1984 (47 U.S.C. § 551), all Cox Subscriber PII in TiVo’s possession or control including, but not limited to: names, addresses, telephone numbers, account numbers, customer lists, and demographic, financial, electronically stored emails, and all transaction information, must be held in the strictest confidence. For any [*]Data with respect to which TiVo is provided or otherwise has access, TiVo will: (i) with respect to Cox Subscriber PII, [*]of such Cox Subscriber Data which is in TiVo’s possession or control; (ii) [*]to the security or integrity of such information in TiVo’s possession or control; and (iii) [*]or control that[*] in substantial harm or [*]to any individual Cox Subscriber. TiVo shall [*]upon the discovery of any loss, or unauthorized access, disclosure or use of any Cox Subscriber Data in TiVo’s possession or control and shall [*]with Cox[*], in the investigation and remediation of any such unauthorized disclosure. In the event that Cox is obligated to notify any Cox Subscribers of the potential unauthorized access to or use of their information as a result of[*], without limiting any of Cox’s other rights or remedies, be [*]for the [*]by Cox in providing such notification as a result thereof.

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8.5 Cox Audit Rights and Remedies with Respect to Cox Subscriber Data. Cox shall have the right to audit, [*]prior written notice and during TiVo’s regular business hours, TiVo’s handling of and processes related to TiVo’s use of any Cox Subscriber Data, no more than once annually, unless a [*] is identified. In addition, TiVo acknowledges and agrees that, Cox Subscriber Data constitutes a unique and valuable, proprietary asset of Cox, and that, in the event of[*] for any injuries caused thereby. As a result, TiVo further acknowledges and agrees that, in the event [*]Cox shall [*]and/or specific[*]. In the event of a dispute relating to any alleged failure by TiVo to comply with the terms and conditions set forth in this SECTION 8, the parties agree that the determination of the remedy[*] shall be subject to the dispute escalation procedures set forth in Section 16.6.

SECTION 9. REPORTS; AUDIT RIGHTS.

9.1 Cox Reports. Commencing when the [*]under Section 4.1 and continuing during the remainder of the Term (plus any period thereafter during which Cox is required to make reportable payments to TiVo), Cox shall send to TiVo the following reports:

(a) Within [*]a statement in a form prepared by Cox which sets forth[*] for the computation of the applicable [*]to be paid by Cox pursuant to Section [*](herein, the “Cox[*] Report”).

(b) Commensurate with the Cox [*]Report in Section 9.1(a), a statement in a form prepared by Cox which sets forth (i) the number of Cox TiVo Subscribers as of the[*] during such calendar month; and (iii) a [*]deployed by Cox as of the last day of such calendar month (herein, the “Cox[*] Report”).

9.2 TiVo Report. Commencing when the [*]by Cox and continuing during the remainder of the Term, TiVo shall send to Cox, [*], a statement in a form prepared by TiVo which sets forth the information reasonably necessary for the computation of any applicable [*]due to Cox during [*]as further described under Section 7.1(c)(iv) and during[*] as further described under Section 7.2(c)(iv) (herein, the “TiVo[*] Report”).

9.3 Audit Rights. Upon not less than [*]prior written notice, each Party (the “Auditing Party”) shall have the right, during the Term (and solely as to TiVo, plus any extension of any provision requiring Cox to make reportable payments to TiVo after the Term) and [*]thereafter, at its cost, to examine at the other Party’s (the “Audited Party’s”) corporate offices during normal business hours, in a manner that does not unreasonably interfere with the operation of the Audited Party’s business, the books and records of the Audited Party which are related directly to the Audited Party’s reports provided under this SECTION 9 and the fees paid to the Auditing Party during [*], to verify the amount of such payments, which examination right may be [*](except as provided below) and[*] may not be subsequently[*]. If any such examination reveals a discrepancy in the amount actually paid to the Auditing Party and the amount which should have been paid to the Auditing Party, then (i) in the event of an overpayment by the Audited Party, the Auditing Party shall promptly pay to the Audited Party the amount by which the Auditing Party was overpaid, and (ii) in the event of any underpayment by the Audited Party, the Audited Party shall promptly pay to the Auditing Party the amount by which the Auditing Party was underpaid, plus interest on the amount of such underpayment at the rate[*] to the Auditing Party; provided that, if the amount of such underpayment is [*]than the [*]of (a[*]) of the total amount that should have been paid during the audited period, or (b)[*], then (A) the Audited Party shall also immediately pay to the Auditing Party an amount equal to the reasonable cost of such examination; and (B) the Auditing Party shall be entitled to [*]during such[*] notwithstanding the limitation provided above with respect to [*]that may be[*]. If the Audited Party reasonably determines that the exercise by the Auditing Party of its rights under this Section 9.3 could conflict with any confidentiality obligation of the Audited Party with respect to any other Person, the

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Auditing Party shall have the right to appoint an independent auditor, agreed to by the Audited Party (not to be unreasonably withheld), to perform the examination permitted hereunder, which auditor shall determine the Audited Party’s compliance with the examination permitted hereunder, which auditor shall determine the Audited Party’s compliance with such payment obligations and report such determination in writing to each of the Audited Party and the Auditing Party.

SECTION 10. REPRESENTATIONS AND WARRANTIES.

10.1 Cox Representation and Warranties. Cox represents, warrants and covenants that:

(a) Cox is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware.

(b) Cox has the requisite power and authority to execute and deliver this Agreement and to fully perform its obligations hereunder. The execution, delivery and performance of this Agreement has been duly authorized by all corporate actions necessary on the part of Cox. There are no contractual or other legal obligations which will in any way interfere with Cox’s full performance of this Agreement. The individual executing this Agreement on behalf of each of Cox has the authority to do so.

10.2 TiVo Representations and Warranties. TiVo represents, warrants and covenants that:

(a) TiVo is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware.

(b) TiVo has the requisite power and authority to execute and deliver this Agreement and to fully perform its obligations hereunder. The execution, delivery and performance of this Agreement has been duly authorized by all corporate actions necessary on the part of TiVo. There are no contractual or other legal obligations of TiVo which will in any way interfere with TiVo’s full performance of this Agreement. The individual executing this Agreement on behalf of TiVo has the authority to do so.

(c) At the[*], the TiVo Software will not [*]any[*] that can be identified and eliminated through the use of a [*]in accordance with[*]. If a [*]in the TE Software or the TAMS Solution, despite TiVo’s good faith efforts to[*], TiVo shall, as Cox’s sole and exclusive remedy, promptly[*], as applicable, to Cox. As used herein, a [*]is undocumented and unauthorized [*]inserted in the [*]with the intention[*] or other computing resources.

(d) With respect to each of the TiVo Software, TiVo warrants as follows:

(i) Until the [*], and, with respect to subsequent TAMS Statements of Work or TE Software Statements of Work, until the[*] provided pursuant to such subsequent Statements of Work in accordance with Sections 5.1(e) or 5.2(d), respectively or such shorter period of time as set forth in the applicable subsequent Statement of Work (in each case, the “Warranty Period”), TiVo expressly warrants that such deliverables will conform in all material respects to the functionalities described in the applicable Statement of Work.

(ii) In the event Cox notifies TiVo in writing during the Warranty Period of any failure to meet the warranty described in this Section 10.2(d) (a “Non-Conformity”), together with such reasonable supporting information and materials reasonably requested by TiVo as shall be reasonably necessary to enable TiVo to verify, diagnose and correct the reported deficiency. TiVo shall [*]TiVo deliverables within[*] after Cox’s report of the Non-Conformity. If TiVo believes the reported

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Non-Conformity is not attributable to the applicable TiVo deliverables, TiVo shall report such belief to Cox with reasonable explanation and supporting documentation. Upon a determination that a Non-Conformity is attributable to the TiVo deliverables, TiVo shall [*]in accordance with[*]. The foregoing sets forth Cox’s sole and exclusive remedy and for any breach of the warranty stated in this Section 10.2(d).

(iii) In the event of a dispute regarding whether there is a Non-Conformity, or whether a Non-Conformity is attributable to the applicable TiVo deliverables, or the whether TiVo has failed to promptly perform any appropriate correction,[*]. If such dispute cannot be mutually resolved by such business/project managers within [*]from the time the business/project managers begin discussions, then either Party may elect to[*].

(e) TiVo shall not be responsible for any bugs, errors, or problems attributable to or associated with, and makes no warranties regarding, any [*]not authorized in writing by TiVo; provided, however, that nothing in this paragraph shall be deemed to [*]of any of[*] the TE Software or the TAMS Solution for use on the Qualifying STBs as specified in an applicable Statement of Work.

(f) Other than with respect to the [*]and the[*] of the Qualifying STBs, the TiVo Software (in the form delivered by TiVo) when used in accordance with this Agreement shall not[*]; provided, that TiVo’s obligations under Section 11.1 shall be the sole remedy for any claims of[*].

(g) The TiVo Software, in the form provided by TiVo, shall not contain any [*]or other similar mechanisms intended to enable TiVo [*]without the exercise of due process of law in the event of any dispute arising under this Agreement.

(h) The TiVo Software, the TiVo Remote Manufacturing Package and any support or services provided by TiVo hereunder shall not interfere with [*] information that is transmitted over the Cox Systems; provided that such requirements and related specifications are set forth in the applicable Statement of Work.

(i) TiVo agrees that, its entry into and performance under this Agreement, shall at all times comply with all applicable laws, rules, and regulations.

(J) EXCEPT FOR THE WARRANTIES EXPRESSLY PROVIDED IN THIS SECTION 10.2, (I) TIVO MAKES NO WARRANTIES AS TO THE TE SOFTWARE, TAMS SOLUTION, TIVO REMOTE MANUFACTURING PACKAGE OR ANY OTHER PRODUCTS, SUPPORT OR SERVICES PROVIDED BY TIVO HEREUNDER, AND (II) TIVO EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES, EXPRESS, IMPLIED AND STATUTORY, WHETHER ARISING FROM COURSE OF DEALING OR USAGE OF TRADE, INCLUDING, WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF TITLE, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND NON-INFRINGEMENT OF THIRD PARTY RIGHTS.

SECTION 11. INDEMNITIES.

11.1 TiVo Indemnity.

(a) Subject to the limitations set forth in this Section 11.1 and SECTION 12, TiVo shall: (i) indemnify, defend (or at its option settle), and hold Cox Indemnified Parties harmless against any claims, suits, and actions brought by a third party (collectively, “Claims”) solely to the extent (A) based on allegations that the TE Software (excluding any Third Party IP), TAMS Solution (excluding any Third Party IP), TiVo Remote (made in strict accordance with the TiVo Remote Manufacturing Package and excluding any Third Party IP) or TiVo Marks [*]of any Person (other than Cox or any Cox Affiliate); or (B)

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arising out of TiVo’s use of the Cox Marks where such use is not authorized by this Agreement or is not in compliance with any applicable statute, law or regulation; and (ii) pay any award, damages, or costs (including, without limitation, reasonable attorneys’ fees and expert witnesses’ fees) finally awarded by a court of competent jurisdiction or agreed on in a settlement of any such Claim. In addition to the foregoing, TiVo shall defend, indemnify and hold the Cox Indemnified Parties harmless from and against any awards, damages, liabilities, losses, and costs (including, without limitation, reasonable attorneys’ fees) relating to or[*] in the performance of this Agreement. TiVo may settle, at TiVo’s sole expense, any Claim for which TiVo is responsible under this Section 11.1 provided that such settlement shall provide for a full release of Cox.

(b) TiVo’s obligations under this Section 11.1 shall be subject to the Cox Indemnified Party (i) promptly notifying TiVo of any such Claim of which it becomes aware or for which it believes TiVo is responsible under this Section 11.1, provided that the failure to so notify TiVo will not relieve TiVo’s obligations except to the extent of any prejudice to TiVo resulting from such failure; and (ii) providing TiVo with sole control over the defense or settlement of such Claim and reasonable assistance in the defense or settlement of any such Claim. Cox may participate in such defense with counsel of its own choosing (with the expenses of such counsel to be borne solely by Cox). [*]of a Claim from a Cox Indemnified Party, or such shorter period of time if an earlier response is required by the Claim, TiVo shall acknowledge receipt of such notice to Cox in writing and provide Cox its position with respect to the indemnification request.

(c) Notwithstanding the foregoing, TiVo shall incur no obligation or liability under this Section 11.1 to the extent that any such Claims are based on:[*], or TiVo Marks after a non-infringing replacement (with substantially comparable features, functionality, and quality) has been made available by TiVo at TiVo’s sole expense and Cox has had a commercially reasonable period of time in which to deploy such replacement; (vi) [*]has been made available by TiVo at TiVo’s sole expense and Cox has had a commercially reasonable period of time in which to implement such non-infringing version; or (vii) any[*].

(d) If TiVo receives written notice of an alleged infringement claim or[*], TiVo may, at its sole option and expense: (i) procure for Cox the right to continue using the TE Software, TAMS Solution, TiVo Remote or TiVo Marks, as applicable, at TiVo’s sole expense; (ii) modify or replace the infringing portion of the TE Software, TAMS Solution, TiVo Remote Manufacturing Package or TiVo Marks, as applicable, without adversely affecting its features or functionality; or (iii) [*]as related to the infringing TE Software, TAMS Solution, TiVo Remote Manufacturing Package, TiVo Marks, or infringing component, feature or functionality, in which event TiVo shall promptly [*]calculated as of the date of such claim and based on a straight-line depreciation over a period of[*] commencing on the date of acceptance of the applicable deliverable(s). For these purposes, the term “Related Deliverable” shall mean any component, feature, or functionality of the TE Software, the TAMS Solution, TiVo Remote Manufacturing Package or the TiVo Marks, the use of which is rendered commercially impracticable as a result of a termination of the license related to the infringing TE Software, TAMS Solution, TiVo Remote Manufacturing Package, TiVo Marks, or infringing component, feature or functionality.

(e) In addition to its other obligations under this Section 11.1, TiVo shall [*]of any such Claims and in implementing any of the resolutions elected by TiVo under Section 11.1(d) above.

(f) This Section 11.1 states TiVo’s entire obligation and liability and Cox’s sole and exclusive remedy with respect to any claim of infringement of any Person’s Intellectual Property Rights, for any claims relating to TiVo’s unauthorized use of the Cox Marks, and for the other claims specified herein.

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11.2 Cox Indemnity. Subject to the limitations set forth in this Section 11.2 and SECTION 12, Cox shall: (i) indemnify, defend (or at its option settle), and hold TiVo Indemnified Parties harmless against any Claims solely to the extent (A) based on allegations that the Cox Marks [*](other than TiVo or any TiVo Affiliate); (B) arising out of Cox’s use of the TiVo Marks where such use is not authorized by this Agreement or is not in compliance with any applicable statute, law or regulation; or (C) based on allegations of infringement arising from one or more of the items listed in Section 11.1(c) above; and[*] finally awarded by a court of competent jurisdiction or agreed on in a settlement of any such Claim. In addition to the foregoing, Cox shall defend, indemnify and hold the TiVo Indemnified Parties harmless from and against any awards, damages, liabilities, losses, and costs (including, without limitation, reasonable attorneys’ fees) relating to or arising out of [*]. Cox may settle, at Cox’s sole expense, any Claim for which Cox is responsible under this Section 11.2 provided that such settlement shall provide for a full release of TiVo. Cox’s obligations under this Section 11.2 shall be subject to the TiVo Indemnified Party (i) promptly notifying Cox of any such Claim of which it becomes aware or for which it believes Cox is responsible under this Section 11.2, provided that the failure to so notify Cox will not relieve Cox’s obligations except to the extent of any prejudice to Cox resulting from such failure; and (ii) providing Cox with sole control over the defense or settlement of such Claim and reasonable assistance in the defense or settlement of any such Claim. TiVo may participate in such defense with counsel of its own choosing (with the expenses of such counsel to be borne solely by TiVo). Within [*]of notice of a Claim from a TiVo Indemnified Party, or such shorter period of time if an earlier response is required by the Claim, Cox shall acknowledge receipt of such notice to TiVo in writing and provide TiVo its position with respect to the indemnification request. In addition to its other obligations under this Section 11.2, Cox shall[*]. This Section 11.2 states Cox’s entire obligation and liability and TiVo’s sole and exclusive remedy with respect to any claim of infringement of any Person’s Intellectual Property Rights, for any claims relating to Cox’s unauthorized use of the TiVo Marks, and for the other claims specified herein.

SECTION 12. LIMITATION OF LIABILITY.

12.1 NOTWITHSTANDING ANY PROVISION TO THE CONTRARY CONTAINED IN THIS AGREEMENT, EXCEPT FOR BREACHES OF SECTION 1, SECTION 2, AND SECTION 14, OR WITH RESPECT TO A PARTY’S INDEMNIFICATION OBLIGATIONS SET FORTH IN SECTION 11, IN NO EVENT SHALL EITHER PARTY’S CUMULATIVE LIABILITY ARISING FROM OR RELATED TO THIS AGREEMENT (OTHER THAN FOR PAYMENT OF FEES, ROYALTIES AND ANY OTHER AMOUNTS OWED UNDER THIS AGREEMENT) WHETHER IN CONTRACT, TORT OR OTHERWISE, EXCEED[*]). NOTWITHSTANDING ANY PROVISION TO THE CONTRARY CONTAINED IN THIS AGREEMENT, EXCEPT FOR BREACHES OF SECTION 1, SECTION 2, SECTION 8, EXHIBIT H, AND SECTION 14, OR WITH RESPECT TO A PARTY’S INDEMNIFICATION OBLIGATIONS SET FORTH IN SECTION 11, IN NO EVENT SHALL EITHER PARTY BE LIABLE UNDER THIS AGREEMENT, UNDER ANY CONTRACT, NEGLIGENCE, STRICT LIABILITY, TORT OR OTHER LEGAL OR EQUITABLE THEORY, FOR ANY CONSEQUENTIAL, EXEMPLARY, PUNITIVE, SPECIAL OR INCIDENTAL DAMAGES OF ANY NATURE WHATSOEVER (INCLUDING, WITHOUT LIMITATION, LOSS OF PROFITS), EVEN IF SUCH PARTY KNEW OR SHOULD HAVE KNOWN OF THE POSSIBILITY OF SUCH DAMAGES. NOTWITHSTANDING THIS SECTION 12.1, THIRD PARTY CLAIMS AGAINST TIVO FOR PERSONAL INJURY, DEATH, OR LOSS OF, OR DAMAGE TO, TANGIBLE PROPERTY THAT ARE ATTRIBUTABLE TO THE TIVO-ENABLED STBS, QUALIFYING STBS, OR THE TIVO REMOTES ARE NOT SUBJECT TO ANY OF THE LIMITATIONS HEREIN. FOR THE AVOIDANCE OF DOUBT, THIS SECTION 12.1 DOES NOT LIMIT COX’S OR TIVO’S PAYMENT OBLIGATIONS UNDER SECTION 3.

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12.2 THE LIMITED WARRANTY, LIMITED REMEDIES, WARRANTY DISCLAIMER AND LIMITED LIABILITY ARE FUNDAMENTAL ELEMENTS OF THE BASIS OF THE BARGAIN BETWEEN TIVO AND COX AND THE PARTIES WOULD NOT BE ABLE TO ENTER INTO THIS AGREEMENT WITHOUT SUCH LIMITATIONS. THE LIMITATIONS SET FORTH IN THIS SECTION 12 SHALL APPLY NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED REMEDY.

SECTION 13. PRESS RELEASE.

Within[*] after the Effective Date, the Parties shall jointly issue a public announcement concerning this Agreement and the transactions contemplated hereby in form and substance of which is set forth in Exhibit M.

SECTION 14. CONFIDENTIALITY.

The terms and conditions of this Agreement and the Confidential Information disclosed in connection with the performance hereof shall be considered proprietary and kept strictly confidential by each Party and used solely for the purposes authorized under this Agreement, except for (a) disclosure as may be required by law, regulation, national stock exchange or national listing system; (b) disclosure in response to a valid subpoena, order, or formal request for information of a court or government agency of competent jurisdiction; provided, however, that any Party required to make such disclosure shall give the other Party prompt notice of any such requirement and the disclosure proposed to be made in response thereto to permit the other Party to contest such disclosure; (c) disclosure to a Party’s Affiliates, employees, consultants, contractors, auditors, legal or financial advisors or other representatives so long as such parties are expressly bound to keep such information confidential and to use such Confidential Information solely for the purposes authorized under this Agreement; (d) disclosure by Cox to Cox Vendors in connection with arrangements relating to products or services supplied to Cox by such vendors, so long as such parties agree in writing to be bound by confidentiality provisions substantially similar to this SECTION 14. If TiVo determines that it is legally required to file this Agreement with the Securities and Exchange Commission, TiVo shall (i) file only that portion of this Agreement that it is legally required to so file and (ii) use commercially reasonable efforts to file and gain approval of a confidential treatment application seeking redaction of commercial terms and conditions herein. In furtherance of the provisions of this SECTION 14, each Party shall use the same degree of care to prevent any unauthorized use or disclosure of the other Party’s Confidential Information that such Party uses with respect to its own Confidential Information, but in no event with less than reasonable care.

SECTION 15. TERM; TERMINATION RIGHTS; EFFECTS OF EXPIRATION OR TERMINATION.

15.1 Term. The initial term of the Agreement shall commence on the Effective Date and continue until the 5th anniversary of the Cox Initial TE Acceptance, provided that in no event shall the initial term extend beyond seven (7) years after the Effective Date and is herein referred to as the “Term.”

15.2 Termination Rights.

(a) Each Party shall have the right to terminate this Agreement for cause in the event the other Party commits a material breach of this Agreement that remains uncured [*]after receipt of written notice of such material breach, [*]with a termination right provided for in any other section of this Agreement.

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(b) In addition, each Party shall have the right to terminate this Agreement without cause under any of the following circumstances, to be exercised by the other Party within[*] after it becomes aware of the circumstance giving rise to such termination: (i) any bankruptcy or other insolvency proceeding (including appointment of a receiver or assignment by the other Party for the benefit of creditors) is commenced by or against the other Party, which, in the case of a proceeding commenced against the other Party, is not dismissed within ninety (90) days after the commencement thereof; and (ii) the other Party commences the dissolution, liquidation and winding up of its affairs or otherwise ceases to function as a going concern.

(c) In addition, TiVo [*]following the date of receipt of Cox’s notice as to [*]of the Cox Initial TE Acceptance Date, if there are [*]as of such anniversary; provided that such [*]period shall be extended on a day-for-day basis for any delays that are directly attributable to any material action, inaction or omission by TiVo in the performance of its obligations under SECTION 6 of this Agreement. Cox shall not be required to provide such written notice as [*]as of such anniversary unless [*]a written request for such notice and any such request by TiVo shall be submitted within [*]anniversary.

(d) In addition, Cox shall have the right to terminate this Agreement effective upon written notice to TiVo given within [*]

(e) In addition, Cox shall have the right to terminate this Agreement upon[*] written notice in the event of any Change of Control Event wherein the controlling entity after such Change of Control Event is a Cox Competitor.

15.3 Effect of Expiration or Termination. Upon the expiration or termination of the Term, the following provisions shall apply:

(a) Each TiVo-enabled STB in the possession of a Cox TiVo Subscriber as of the expiration date will be [*]until the applicable Cox TiVo Subscriber [*]the TE Software service; provided that Cox continues[*] to [*]for each such TiVo-enabled STB in accordance with Section 3.2.

(b) So long as the Agreement is not terminated by TiVo for Cox’s material breach, Cox will have[*] following the date of expiration or termination to cease offering and providing the TE Software (with the TiVo Remote) to additional Cox Subscribers; provided that Cox [*]for each such TiVo-enabled STB in accordance with Section 3.2. After such[*], or promptly upon TiVo’s termination for Cox’s material breach, Cox will not be entitled to offer or provide the TE Software or TiVo Remote to any additional Cox Subscribers.

(c) So long as the Agreement is not terminated by TiVo for Cox’s material breach and provided that Cox [*]for each TiVo-enabled STB in accordance with Section 3.2 and Section 15.3(a) and any applicable [*]in accordance with Section 6.1, TiVo will continue to provide[*].

(d) Upon the expiration or termination of this Agreement, [*]TAMS-enabled Advertising. However, for a period of [*]following the date of expiration or termination, Cox and TiVo will each have the right to continue to provide any TAMS-enabled Advertising sold by such Party prior to the date of such termination or expiration on the TiVo-enabled STBs (and if Cox elected to proceed with [*]) and the rights and obligations of the Parties under SECTION 7 shall continue and survive for such [*]day period. Upon the expiration of such[*] period, Cox shall immediately cease all use of the TAMS Solution.

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(e) Notwithstanding any of the foregoing, in the event Cox terminates this Agreement pursuant to Section 15.2(e), Cox’s obligations to provide [*]to TiVo, or to allow TiVo to collect such[*], pursuant to Section 8.2 shall immediately terminate.

(f) Notwithstanding any of the foregoing, in the event either Party terminates this Agreement pursuant to Sections 5.1(b)(iv), 5.2(a)(iv) or 5.2(d)(iv), except for the Sections identified in Section 15.4 below, all Sections of this Agreement shall terminate immediately including, without limitation, the provisions of this Section 15.3.

15.4 Survival. In addition to any surviving rights (if any) under Section 15.3, the following Sections and Exhibits shall survive any expiration or termination of this Agreement: SECTION 1 (solely to the extent necessary to support the surviving rights (if any) under Section 15.3), SECTION 2, SECTION 3, SECTION 8 (except as otherwise provided in Section 15.3(e)), SECTION 9 (for the time periods specified therein), Section 10.2(j), SECTION 11, SECTION 12, SECTION 14, Section 15.4, SECTION 16, and the Exhibits (solely to the extent necessary to support the surviving rights (if any) under Section 15.3). Except as provided in Section 15.3 and this Section 15.4, all other rights and obligations (of both TiVo and Cox) will terminate.

SECTION 16. GENERAL.

16.1 Notices. Except as set forth below, all notices hereunder shall be in writing and delivered personally or sent by certified or registered U.S. mail, postage prepaid and return receipt requested, facsimile transmission (with electronic confirmation of receipt), or nationally recognized overnight delivery service (with next day delivery specified) to the receiving Party at its address set forth below or as otherwise designated by written notice provided by such receiving Party in accordance with this Section 16.1.

Notice to TiVo shall be provided as follows:

TiVo Inc.

2160 Gold Street

Alviso, California 95002

Attention: General Manager, Service Provider Division

Facsimile: (408) 519-3304

With a copy to:

TiVo Inc.

2160 Gold Street

Alviso, California 95002

Attention: General Counsel

Facsimile: (408) 519-3304

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Notice to Cox shall be provided as follows:

Cox Communications, Inc.

1400 Lake Hearn Drive

Atlanta, GA 30319

Facsimile: (404) 847-6029

Attention: VP of Video Product Development

With a copy to:

Cox Communications, Inc.

1400 Lake Hearn Drive

Atlanta, GA 30319

Facsimile: (404) 843-5845

Attention: General Counsel

Notice shall be deemed to be effectively given and received on the date of receipt by the receiving Party or, if earlier: (i) if delivered by hand, on the date delivered; (ii) if sent by U.S. mail, on the fifth business day after the date of deposit with the U.S. Postal Service; (iii) if sent by facsimile transmission, on the date sent if sent on a business day during normal business hours in the place of receipt (as evidenced by the electronic confirmation) or otherwise on the next business day; and (iv) if sent by overnight delivery service, on the next business day after the date of deposit with such delivery service.

16.2 Amendments; Waivers Limited. No amendment, supplement, modification or waiver of any provision of this Agreement shall be binding upon a Party unless such amendment, supplement, modification or waiver is set forth in a written instrument which is executed and delivered on behalf of such Party by, in the case of TiVo, an officer of TiVo and, in the case of Cox, a senior officer of Cox, or any designee authorized in writing to execute and deliver such instrument. Such amendment, supplement, modification or waiver shall be effective only to the extent specifically set forth in such written instrument. Neither the exercise (from time to time and at any time) by a Party of, nor the delay or failure (at any time or for any period of time) to exercise, any right, power or remedy shall constitute a waiver of the right to exercise, or impair, limit or restrict the exercise of, such right, power or remedy or any other right, power or remedy at any time and from time to time thereafter. No waiver of any right, power or remedy of a Party shall be deemed to be a waiver of any other right, power or remedy of such Party or shall, except to the extent so waived, impair, limit or restrict the exercise of such right, power or remedy.

16.3 Successors and Assigns. This Agreement shall be binding on the respective transferees and successors of the Parties hereto, except that neither this Agreement nor either Party’s rights or obligations hereunder shall be assigned or transferred by either Party without the prior written consent of the other Party. Notwithstanding the foregoing, either Party may assign its rights and obligations hereunder, without the prior written consent of the other Party, to (i) a successor entity resulting from a merger, combination, reorganization or consolidation of such Party, (ii) the transferee of all or substantially all of the assets of such Party, or (iii) an Affiliate of such Party. A permitted assignment under this 16.3 shall not relieve the assigning Party of its duties or obligations hereunder unless the other Party specifically releases the assigning Party in writing and shall not affect Cox’s right to terminate this Agreement pursuant to Section 15.2(e) in the event such assignment by TiVo results in a Change of Control Event to a Cox Competitor.

16.4 Force Majeure. Neither Cox nor TiVo shall have any liability for any delay in performance of any duties or obligations of this Agreement (except for payment of money owed) and such delay will not be considered a breach of this Agreement if such delay is caused by a labor dispute, fire, earthquake, flood, or

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any other similar event beyond the reasonable control of such Party, provided that such Party notifies the other Party of the circumstances causing the delay and resumes performance as soon as possible.

16.5 Governing Law. This Agreement shall be deemed to have been executed and delivered in the State of Delaware, and shall be governed by, and construed and enforced in accordance with, the laws of such State without regard to any conflicts of law principles thereof that will require the application of the laws of any other state or jurisdiction.

16.6 Dispute Escalation. The Parties will first attempt to resolve any dispute under this Agreement by referring the matter to TiVo’s Cox program manager and Cox’s director level representative to resolve the dispute who will be tasked with discussing the issues and negotiating in good faith in an effort to reach a resolution. If such designated representatives are not able to agree on a resolution within[*] after the initial notice of dispute, the dispute shall be escalated to the[*]. If the respective senior executive management teams of the Parties are not able to agree on a resolution within [*]after such escalation, either Party may elect for the dispute to be resolved pursuant to Section 16.4. Notwithstanding the foregoing, neither party shall be obligated to exhaust the dispute escalation procedures set forth in this Section 16.6 prior to initiating any action seeking preliminary or injunctive relief relating to any alleged breach of a party’s obligations under this Agreement pertaining to the treatment of a party’s Intellectual Property Rights or Confidential Information.

16.7 Severability. The Parties agree that each provision of this Agreement shall be construed as separable and divisible from every other provision and that the enforceability of any one provision shall not limit the enforceability, in whole or in part, of any other provision hereof. In the event that a court of competent jurisdiction determines that a restriction contained in this Agreement shall be unenforceable because of the extent of time or geography, such restriction shall be deemed amended to conform to such extent of time and/or geography as such court shall deem reasonable.

16.8 Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed an original and all such counterparts together shall constitute but one and the same instrument. This Agreement shall be binding upon the delivery by each Party of an executed signature page to the other Party by facsimile transmission, provided that, if signature pages are so delivered by facsimile transmission, each Party shall also immediately deliver an executed original counterpart of this Agreement to the other Party by overnight delivery service (with next day delivery specified).

16.9 Entire Agreement; Prior Agreements. This Agreement sets forth the entire Agreement and understanding of the Parties relating to the subject matter hereof, and supersedes all prior Agreements, arrangements or understandings relating to the subject matter hereof. All prior agreements among the Parties shall be deemed terminated by mutual consent as of the date hereof.

16.10 Third Party Beneficiaries. No provision of this Agreement confers upon any person other than the Parties hereto any rights or remedies hereunder, except as otherwise expressly provided in this Agreement.

16.11 Nonexclusive Agreement. The Parties’ rights and obligations under this agreement are non-exclusive and nothing in this Agreement shall be construed as prohibiting any Party from entering into a similar business relationship with any other Person.

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

30.

IN WITNESS WHEREOF, the undersigned Parties have caused this Agreement to be executed by their duly authorized representatives.

TIVO INC.		COXCOM, INC.
By:	/s/ Naveen Chopra	By:	/s/ Stephen K. Necessary
Name:	Naveen Chopra	Name:	Stephen K. Necessary
Title:	VP, Corporate Development	Title:	VP – Video Product Development
Date:	8/22/06	Date:	8/22/06

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

31.

EXHIBIT A – DEFINITIONS

As used in the Agreement to which this Exhibit A is attached and into which it is incorporated by reference and the Schedules and Exhibits (including this Exhibit) attached thereto, the following capitalized terms shall have the following respective meanings ascribed thereto:

“Acceptance Period” shall have the meaning set forth in Section 5.1(e)(ii).

“Affiliate” shall mean, with respect to any Person on any applicable date of determination, any other Person directly or indirectly controlling, controlled by or under common control with such first Person as of such date. As used herein, the term “control” (including any correlative usages such as “controlling,” “controlled by” and “under common control with”) shall mean (i) the legal, beneficial or equitable ownership, directly or indirectly, of at least a majority of the equity interests of a Person, or (ii) the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person or the election of a majority of the board of directors or comparable governing body of a Person, whether through the ownership of voting securities, by contract or otherwise.

“Agreement” shall have the meaning set forth in the preamble hereto, including all amendments, supplements and modifications thereto.

“Alternate License Agreement” shall have the meaning set forth in Section 3.7(a).

“Cable System” shall mean any cable television system that distributes Television Programming Services to subscribers within the Territory by [*]and/or other means developed in the future to subscribers or viewers.

“Claims” shall have the meaning as set forth in Section 11.1(a).

“Change of Control Event” shall mean (A) the consummation of a merger or consolidation of TiVo with or into another entity or any other corporate reorganization that results in Persons, who immediately prior to such merger, consolidation or other reorganization did not collectively own [*]of the voting power of TiVo, immediately after such merger, consolidation, or other reorganization collectively owning[*] or more of the voting power of the outstanding securities of (i) the continuing or surviving entity, or (ii) any direct or indirect parent corporation of such continuing or surviving entity; or (B) the sale, transfer, or disposition of all or substantially all of TiVo’s assets to a third party that is not a TiVo Affiliate.

“Computer Viruses” shall have the meaning as set forth in Section 10.2(c).

“Cox” shall have the meaning set forth in the preamble to this Agreement.

“Cox Auditor” shall mean an independent public accounting firm or an independent auditing firm designated by Cox that is not the accounting or auditing firm retained by Cox to complete its company-wide audit and that is paid solely on an hourly or other fixed fee basis to perform any audit services contemplated under this Agreement.

“Cox Competitor” shall mean (i) [*]as reported in its most recent filings with any governmental agency, and (ii) any of the[*] determined by reference to size of customer base as reported in the most recent publicly available industry data.

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

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“Cox Indemnified Parties” shall mean Cox, its Affiliates, all Cox Systems, and each of their respective controlling persons, officers, directors, shareholders, partners, members, employees and agents.

“Cox Initial TAMS Acceptance” shall mean Cox’s acceptance of the Initial TAMS Solution in accordance with Section 5.1(e)(ii).

“Cox Initial TE Acceptance” shall mean Cox’s acceptance of the Initial TE Software in accordance with Section 5.2(d)(ii).

“Cox Marks” shall mean the Cox trade names, logos, trademarks, and/or service marks as set forth in Exhibit F and provided by Cox to TiVo for use in accordance with this Agreement.

“Cox Monthly Fee Report” shall have the meaning set forth in Section 9.1(a).

“Cox Services” shall mean any one of the following services offered to consumers by Cox: High Speed Data Service, Multichannel Video Delivery, digital or switched telephony services.

“Cox STB” shall mean a set top box provided by Cox to Cox Subscribers.

“Cox Subscriber” shall mean each subscriber to which Cox or any Cox System intentionally authorizes the delivery of cable television service, provided that, for purposes of calculating a number of Cox Subscribers under this Agreement, such number shall be calculated using the methodology Cox uses to count subscribers for purposes of its quarterly earnings release.

“Cox Subscriber Data” shall mean, whether or not personally identifiable to Cox Subscribers: (i) any information or data provided to or collected by, from or about Cox Subscribers, including, without limitation, voluntarily disclosed data; (ii) any information about a Cox Subscriber’s access to or use of the TiVo-enabled STBs or the TAMS Solution; and (iii) all content included in a Cox Subscriber’s data or media storage and any other information or data received or contributed by a Cox Subscriber in connection with and stored as part of or in connection with the TiVo-enabled STBs (and if Cox elected to proceed with Phase 2 Advertising, with the Qualifying STBs). Notwithstanding the foregoing, Cox Subscriber Data shall not include any information relating to a Cox Subscriber that is separately collected and maintained by TiVo pursuant to a separate customer relationship with such Cox Subscriber.

“Cox System” shall mean an entity controlled by Cox where “control” is defined as having: (i) a direct or indirect economic ownership interest of at least fifty-one percent (51%); (ii) voting control sufficient to elect the board of directors or other governing body; or (iii) a direct or indirect economic ownership interest of at least thirty-five (35%) with full management and operational control on a day-to-day basis, including, without limitation the right to bill subscribers, select Television Programming Services, and designate channels for carriage of programming services, and authority to enter into binding agreements on behalf of such systems regarding programming and promotional decisions. For the avoidance of doubt, any breach of this Agreement by a Cox System shall be deemed a breach by Cox.

“Cox TAMS Acceptance” shall mean Cox’s acceptance of subsequent Releases of the TAMS Solution in accordance with Section 5.1(e)(ii).

“Cox TiVo Subscriber” shall mean each Cox Subscriber with at least one TiVo-enabled STB.

“Cox TiVo Subscriber Report” shall have the meaning as set forth in Section 9.1(b).

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

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“Cox TE Acceptance” shall mean Cox’s acceptance of subsequent Releases of the TE Software in accordance with Section 5.2(d)(ii).

“Cox Vendor” shall mean any vendor or supplier (including each of their subcontractors performing services on behalf of Cox) of one or more products or services utilized by, used in connection with, or distributed or deployed in any Cox System. The term “Cox Vendor” shall include, without limitation, any vendor or supplier that designs, creates or distributes interactive services, applications or user interfaces related to multi-channel video programming or high speed Internet services, or wireless telephone services (including, without limitation, electronic program guides, interactive program guides, middleware, polling, e-commerce, and digital video recording).

“Confidential Information” shall mean all non-public or proprietary information that one Party discloses or makes available to the other Party, including, without limitation, any such information disclosed between the Parties in the course of negotiating or performing this Agreement, but excluding any such information that (i) is or becomes generally available to the public other than as a result of a disclosure by the receiving Party in violation of this Agreement, (ii) was or had become available to the receiving Party on a non-confidential basis from a source which was not prohibited from disclosing such information to the receiving Party by a legal, contractual or fiduciary obligation of confidentiality to the disclosing Party, or (iii) was independently developed by the receiving Party through Persons who have not had, either directly or indirectly, access to or knowledge of the Confidential Information.

“Development Fees” shall have the meaning set forth in Section 3.3.

“[*]Subscriber” shall mean each subscriber to which The [*]intentionally authorizes the delivery of[*] television service.

“Documentation” shall mean all documentation relating to the TE Software, TAMS Solution or TiVo Remote that is either: (i) specified as a deliverable pursuant to the applicable Statement of Work; or (ii) TiVo End User Documentation.

“DVR Features” shall mean DVR Technology, excluding Home Network Features and Media Center Features.

“DVR Technology” shall mean hardware, software, standards or other technology that enables consumers to record television programs, independent of the method of video delivery, to a hard disk drive or other random access digital storage medium and control a television display, including, without limitation, pausing, fast forwarding and rewinding live and recorded television, and all technology reasonably related to any of the foregoing.

“Effective Date” shall have the meaning set forth in the preamble to this Agreement.

“Headend” shall mean the control center of a cable television system, where incoming signals are amplified, converted, processed and combined into a common cable along with any original cablecasting, for transmission to subscribers, including super headends, master headends and distribution hubs.

“Home Networking Features” shall mean hardware, software, standards and other technology that are designed for the purpose of creating or managing internet protocol connections between consumer electronics devices in the home where the relevant devices may include, without limitation, a DVR, personal computer, portable video player, portable music player, voice over internet protocol (VOIP)

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

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communications devices or cellular phone (including all related user interfaces, software and hardware), and all technology reasonably related to any of the forgoing.

“[*]

“Initial Cox Market” shall have the meaning set forth in Section 4.1.

“Initial TAMS Solution” shall mean the initial Release of the software solution specified in the Initial TAMS Statement of Work that incorporates certain components of TiVo’s Interactive Advertising Technology.

“Initial TAMS Statement of Work” shall have the meaning set forth in Section 5.1.

“Initial TE Software” shall mean the initial Release of the software solution specified in the Initial TE Software Statement of Work that incorporates certain components of TiVo’s DVR Technology.

“Initial TE Software Statement of Work” shall have the meaning set forth in Section 5.2.

“Intellectual Property Rights” shall mean any or all of the following and all rights in, arising out of, or associated therewith, whether arising from statute or common law: (i) all United States and foreign patents and utility models and applications therefore and all reissues, divisions, re-examinations, renewals, extensions, provisionals, continuations and continuations-in-part thereof, and equivalent or similar rights anywhere in the world in inventions and discoveries, including, without limitation, invention disclosures, (ii) all trade secrets and other rights in know-how and confidential or proprietary information, (iii) all copyrights, copyrights registrations and applications therefore and all other rights corresponding thereto throughout the world, (iv) all industrial designs and any registrations and applications therefore throughout the world, (v) all rights in World Wide Web addresses and domain names and applications and registrations therefore, (vi) all trade names, logos, common law trademarks and service marks, trademark and service mark registrations and applications therefore and all goodwill associated therewith throughout the world, and (vii) any similar, corresponding or equivalent rights to any of the foregoing throughout the world.

“Interactive Advertising Technology” shall mean hardware, software, standards or other technology that enables one or more of the following advertising features:[*] and all technology reasonably related to any of the foregoing.

[*]

[*]Media Center Features” shall mean hardware, software, standards and other technology that are enables the sharing of media files (video, music, or data) between consumer electronics devices which may include, without limitation, a DVR, personal computer, portable video player, portable music player, voice over internet protocol (VOIP) communications devices or cellular phone (including all related user interfaces, software and hardware), and all technology reasonably related to any of the forgoing.

“MFN Amendment” shall have the meaning as set forth in Section 3.7(a).

“MFN Notice” shall have the meaning as set forth in Section 3.7(b).

“Monthly Fees” shall have the meaning as set forth in Section 3.2.

[*]

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

A-4

“Net Revenue” shall mean, for any period, the gross revenue actually received by TiVo that is attributable to the display of TiVo [*]during such period, and during Phase[*] during such period, in each case[*] costs related to such advertising.

“Non-Conformity” shall have the meaning set forth in Section 10.2(d).

“Non-TiVo Delay” shall have the meaning set forth in Section 5.4(a).

“Non-TiVo Qualifying STB” shall mean any Qualifying STB that is not a TiVo-enabled STB.

“Operating Environment” shall mean the environment for operation of the TiVo Software as further defined in the applicable Statement of Work and including, without limitation, the Qualifying STB configurations set forth in Exhibit N.

“Party” and “Parties” shall have the meanings set forth in the preamble to this Agreement.

“PCR” shall have the meaning set forth in Section 5.1(c)(vi).

“Permitted Advertising” shall mean advertising that is subject to customary broadcast advertising standards and does not include advertisements that (i) advertise products or services that relate directly or indirectly to sexual or sexually explicit, pornographic or other “adults-only” objectionable material, as [*]“Person” shall mean any natural person, corporation, firm, joint venture, partnership, association, enterprise, limited liability company, trust or other entity or organization, or any government or political subdivision or any agency, department or instrumentality thereof.

[*]

[*]

[*]

[*]

“Qualifying STB” shall mean any of the set top box hardware and software configurations listed on Exhibit N whether or not such set top box contains the TE Software or the TAMS Solution.

“Release” shall mean, with respect to the TE Software and TAMS Solution, the initial version of such software provided to Cox pursuant to the applicable Statement of Work and each subsequent released version of such software that includes an enhancement or addition providing features and/or functionality beyond that provided in the prior Release and which TiVo makes generally commercially available.

“RFI” shall mean an electronic submission by a Cox Subscriber sent via the Cable System serving such Cox Subscriber, which requests additional information regarding a product or service in response to any Showcase Advertising.

“[*]Cox Market” shall have the meaning set forth in Section 4.1.

“Showcase Advertising” shall mean advertising enabled with a Showcase Video Repository and one or more of the following features: [*]“Showcase Specific Pointer” shall mean a [*]links to such content.

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

A-5

“Showcase Video Repository” shall mean a long-form, broadcast-quality, video advertising content repository stored on the STB Storage Space of a Qualifying STB or on a VOD server accessible via a Qualifying STB.

“Statement of Work” shall mean a document, agreed to in writing by the Parties, that is entered into in accordance with the terms of SECTION 5.

“STB Storage Space” shall mean a portion of storage space that (i) is contained in the Qualifying STB or in a device that is locally or remotely attached to the Qualifying STB, and (ii) is comprised of a hard disk or equivalent digital storage space.

“Subscriber Acquisition Commission” shall have the meaning as set forth in Section 3.1.

“Switched Digital Broadcast” shall mean the technique or optimizing efficiency of bandwidth use by selectively broadcasting a channel only when a subscriber selects it. An unwatched channel is deleted from the digital broadcast stream and then automatically switched back on when a subscriber selects it.

“TAMS” or “TiVo Interactive Advertising Management System” shall mean an advertising management system developed for Cox pursuant to this Agreement that enables the delivery of Showcase Advertising or other DVR- or VOD-based advertising to Cox Subscribers.

“TAMS-enabled Advertising” shall mean advertising enabled with the TAMS Solution.

“TAMS Solution” shall mean the Initial TAMS Solution and any subsequent Release of the TAMS Solution made available to Cox under an applicable TAMS Statement of Work as further described in Sections 5.3 and 6.2(c).

“TAMS Solution Development Fee” shall have the meaning set forth in Section 5.1(e)(iv) of this Agreement.

“TAMS Statement of Work” shall mean the Initial TAMS Statement of Work and any subsequent Statements of Work executed by the Parties to incorporate additional features and/or functionality to the TAMS Solutions as further described in Section 5.1.

“Targeted Advertising” shall mean any [*]

“TE Software” shall mean the Initial TE Software and any subsequent Release of the TE Software made available to Cox under an applicable Statement of Work as further described in Sections 5.3 and 6.2(c).

“TE Software Development Fee” shall have the meaning set forth in Section 5.2(e) of this Agreement.

“TE Software Statement of Work” shall mean the Initial TE Software Statement of Work and any subsequent Statements of Work executed by the Parties to incorporate additional features and/or functionality to the TE Software as further described in Section 5.2.

[*]

[*]

“Term” shall have the meaning set forth in Section 15.1.

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

A-6

“Territory” shall mean the United States of America, the District of Columbia, and the United States’ territories and possessions.

“Third Party IP” shall mean any Intellectual Property Rights owned or controlled by a Person other than TiVo or a TiVo Affiliate and set forth in an applicable Statement of Work, which may be incorporated or referenced in, or required for use of, the TE Software or TAMS Solution, in each case as listed on Exhibit C attached hereto, as may be amended by the Parties pursuant to an applicable Statement of Work.

“TiVo” shall have the meaning set forth in the preamble to this Agreement.

[*]

“TiVo-enabled STB” shall mean a Qualifying STB for which the TE Software (or any component thereof) has been delivered and is active as of the date of determination.

“TiVo End User Documentation” shall mean all documentation relating to the TE Software, TAMS Solution or TiVo Remote provided to Cox by TiVo that is identified as end user documentation.

“TiVo Indemnified Parties” shall mean TiVo, all TiVo Affiliates and each of their respective controlling persons, officers, directors, shareholders, partners, members, employees and agents.

“TiVo Launch Marketing Campaign” shall have the meaning as set forth in Section 4.3(b).

“TiVo Marks” shall mean the TiVo trade names, logos, trademarks, and/or service marks provided by TiVo to Cox for use in accordance with this Agreement.

“TiVo Remote” shall mean the remote control for the TE Software manufactured in strict accordance with the TiVo Remote Manufacturing Package.

“TiVo Remote Manufacturing Package” shall mean the manufacturing package provided by TiVo and setting forth the specifications, BOM, and other requirements for manufacturing of the TiVo Remote.

“TiVo Revenue Share Report” shall have the meaning set forth in Section 9.2.

“TiVo Software” shall mean the[*], in each case including all[*] to be provided by TiVo to Cox under the terms of Exhibit L and all new Releases provided by TiVo to Cox pursuant to Sections 5.3 or 6.2(c).

“TiVo Support Fee” shall have the meaning set forth in Section 6.1.

“TiVo Users” shall mean the entire group of TiVo media consumers, subscribers, users, end-user licensees and/or viewers, including those who obtain TiVo products from distributors other than Cox.

“Update” shall mean, with respect to the TiVo Software, all error corrections and bug fixes to the TE Software or TAMS Solution which TiVo makes available as part of its support services under Exhibit L without requiring the payment of additional fees.

“VOD” shall mean a video-on-demand service that enables cable subscribers to select a video asset from a content repository provided by a cable television service using a user interface, which video asset is streamed to the subscriber’s set-top box via the Cable System and which usually (but not always) can be manipulated by the subscriber (e.g., stop, pause, fast forward, rewind).

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

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“Warranty Period” shall have the meaning set forth in Section 10.2(d)(i).

“[*]

[*]

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

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EX-10.3

Exhibit 10.3

Confidential treatment has been requested for portions of this exhibit. The copy filed herewith omits

the information subject to the confidentiality request. Omissions are designated as [*]. A complete

version of this exhibit has been filed separately with the Securities and Exchange Commission.

SERVICE PROVIDER AMENDMENT TO

TIVO INTERACTIVE PROGRAM GUIDE

LICENSE AGREEMENT

THIS SERVICE PROVIDER AMENDMENT TO THE TIVO INTERACTIVE PROGRAM GUIDE LICENSE AGREEMENT (the “AMENDMENT”), having an Effective Date of August 23, 2006 (“AMENDMENT EFFECTIVE DATE”), is made and entered into by and between GEMSTAR – TV GUIDE INTERNATIONAL, INC., including all of its SUBSIDIARIES (hereinafter collectively referred to as “GEMSTAR”), AND TIVO INC., including all of its SUBSIDIARIES (hereinafter collectively referred to as “TIVO”) and amends the TiVo Interactive Program Guide License Agreement, having an effective date of June 6, 2003, as amended by the TV Guide Showcase Rider, having an effective date of June 6, 2003 and the TV Guide Promotion Rider, having an effective date of June 6, 2003 (collectively referred to hereinafter as the “ORIGINAL AGREEMENT.” The ORIGINAL AGREEMENT as amended by this AMENDMENT shall be referred to herein as the “AGREEMENT.” All capitalized terms used in this AMENDMENT and not otherwise defined herein shall have the meaning defined in the ORIGINAL AGREEMENT.

RECITALS

The PARTIES desire to amend the ORIGINAL AGREEMENT in accordance with the terms and conditions set forth herein to provide TIVO with certain license rights to authorize certain SERVICE PROVIDERS to use GEMSTAR AUTHORIZED TIVO IPG(S) in conjunction with other TIVO provided technology, features and/or functionality.

AMENDMENT

1. Section 1.3 and 1.4. These sections are hereby revised as follows:

1.3 TIVO desires certain IPG-RELATED PATENT rights from GEMSTAR in connection with making INTERACTIVE PROGRAM GUIDES using GEMSTAR IPG-RELATED PATENTS available to consumers through TIVO PVR DEVICES and licensed SERVICE PROVIDER DEVICES marketed in the TERRITORY.

1.4 GEMSTAR, subject to the terms and conditions of this AGREEMENT, is prepared to provide certain IPG-RELATED PATENT rights related to INTERACTIVE PROGRAM GUIDES to TIVO, for TIVO’s implementation in TIVO PVR DEVICES and the TIVO SERVICE and for sublicense to certain SERVICE PROVIDERS.

2. Section 2.10 “END-USER”. The definition of END-USER is hereby revised to state as follows:

“END-USER(S)” shall mean a person who obtains software and/or hardware (i) at RETAIL for their own use, which may include gifting and resale, or (ii) as provisioned, directly or indirectly, by a SERVICE PROVIDER or its affiliates.

3. Section 2.13 “GEMSTAR AUTHORIZED TIVO IPG(S)”. The definition of GEMSTAR AUTHORIZED TIVO IPG(S) is hereby revised to state as follows to address differing obligations relating to TIVO IPGs for SERVICE PROVIDER DEVICES:

“GEMSTAR AUTHORIZED TIVO IPG(S)” shall mean (A) for TIVO PVR DEVICES a TIVO IPG that (a) is branded or co-branded with the TV GUIDE mark (or other mark designated by

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

GEMSTAR as agreed to by TIVO) (collectively the “GEMSTAR MARK”) in the manner set forth in this AGREEMENT, and (b) includes GEMSTAR’s standard patent markings in the manner set forth in this AGREEMENT; and (B) for SERVICE PROVIDER DEVICES a TIVO IPG that includes GEMSTAR’s standard patent markings in the manner set forth in this AGREEMENT. The PARTIES agree and acknowledge that TIVO or any other entity may provide the data that populates the GEMSTAR AUTHORIZED TIVO IPG.

4. Section 2.15 “INITIAL ACTIVATION”. The definition of “INITIAL ACTIVATION” is hereby revised to state as follows:

“INITIAL ACTIVATION” shall mean the first (and only the first) access to a TIVO SERVICE (i) by a TIVO PVR DEVICE (including TIVO PVR DEVICES refurbished and resold by TIVO) during which such TIVO PVR DEVICE receives television program schedule information that populates the GEMSTAR AUTHORIZED TIVO IPG, in any way and for any length of time; or (ii) by a SERVICE PROVIDER DEVICE (excluding any access only for testing or demonstration) during which such SERVICE PROVIDER DEVICE receives television program schedule information that populates the GEMSTAR AUTHORIZED TIVO IPG, in any way and for any length of time.

5. Section 2.21 “PVR DEVICES”. The definition of “PVR DEVICES” is hereby revised as follows:

“….TRANSFERRED through RETAIL. Except for the limited purpose of defining SERVICE PROVIDER DEVICE(S), PVR DEVICES as used in this AGREEMENT shall not include [*], DIRECTV SET-TOP BOXES, or any other SERVICE PROVIDER provisioned set-top box (other than SERVICE PROVIDER DEVICE(S)),…”

6. Section 2.23A “SERVICE PROVIDER AFFILIATE”. The following new definition is added to Section 2 to address affiliates of SERVICE PROVIDERS:

“SERVICE PROVIDER AFFILIATE” shall mean a system in which a SERVICE PROVIDER or an entity controlled by, in control of or under common control with such SERVICE PROVIDER has: (i) a direct or indirect economic ownership interest of at least fifty-one percent (51%); (ii) voting control sufficient to elect the board of directors or other governing body; or (iii) a direct or indirect economic ownership interest of at least thirty-five percent (35%) with full management and operational control on a day-to-day basis, including, without limitation, the authority to enter into binding agreements on behalf of such system regarding programming decisions.

7. New Section 2.23B “SERVICE PROVIDER DEVICE(S)”. The following new definition is added to Section 2 to address devices provisioned by SERVICE PROVIDERS:

“SERVICE PROVIDER DEVICE(S)” shall mean PVR DEVICES which incorporate the TIVO TECHNOLOGY and utilize a GEMSTAR AUTHORIZED TIVO IPG, and which are provided, directly or indirectly, by a SERVICE PROVIDER, or a SERVICE PROVIDER AFFILIATE, to its subscribers.

8. Section 2.28 “TIVO IPG(S)”. The definition of “TIVO IPG(S)” is hereby revised to state as follows:

“TIVO IPG(S)” shall mean an IPG specified by TIVO and provided in connection with a TIVO SERVICE for use with, and only used with, a TIVO PVR DEVICE or a licensed SERVICE

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

PROVIDER DEVICE. TIVO IPG shall not mean [*], nor shall it mean [*], or, except as authorized in this AGREEMENT, any SERVICE PROVIDER network.

9. Section 2.31 “TIVO SERVICE”. The definition of “TIVO SERVICE” is hereby revised to state as follows:

“TIVO SERVICE” shall mean a TIVO branded service provided by TIVO or a licensed SERVICE PROVIDER that requires INITIAL ACTIVATION by an END-USER and includes GEMSTAR AUTHORIZED TIVO IPG and (a) Showcases, (b) software upgrades to support the TIVO TECHNOLOGY, and/or (c) the ability to upgrade to a service with additional features and functionality offered by TIVO. TIVO SERVICE may include the ability for an END USER to interact with a TIVO PVR DEVICE or SERVICE PROVIDER DEVICE remotely via the Internet (which may be accessed via a PERSONAL COMPUTER) or other means.

10. Section 2.33 “TRANSFERRED” or “TRANSFER”. The definition of “TRANSFERRED” or “TRANSFER” is hereby revised to state as follows:

“TRANSFERRED” or “TRANSFER” shall mean (i) deliver(ed) (including installed or downloaded) to others(s) in the TERRITORY, regardless of the basis of compensation, if any (e.g., demonstration models, consignment or by gift) and/or (ii) sold and/or delivered in combination with other products in the TERRITORY.

11. Section 3.1(d) SERVICE PROVIDER Devices. This Section is hereby replaced in its entirety with the following:

(d) SERVICE PROVIDER DEVICES. GEMSTAR grants to TIVO, subject to TIVO’s continued compliance with the terms and conditions set forth herein:

(i) a worldwide, non-exclusive, nontransferable (except as set forth herein and in Section 10.11) manufacturing right, under the GEMSTAR IPG-RELATED PATENTS, to make and have made SERVICE PROVIDER DEVICES;

(ii) a non-exclusive, nontransferable (except as set forth herein and in Section 10.11) right, under the GEMSTAR IPG-RELATED PATENTS to import, sell, lease, offer to sell or otherwise TRANSFER such SERVICE PROVIDER DEVICES, and only in conjunction with such SERVICE PROVIDER DEVICES, the GEMSTAR AUTHORIZED TIVO IPG within the TERRITORY; and

(iii) a non-exclusive, nontransferable (except as set forth herein and in Section 10.11) right, under the GEMSTAR IPG-RELATED PATENTS to use, and have END-USERS use, the SERVICE PROVIDER DEVICES, and, only in conjunction with such SERVICE PROVIDER DEVICES, the GEMSTAR AUTHORIZED TIVO IPG within the TERRITORY.

The foregoing rights in this Section 3.1(d) are sublicensable by TIVO to each SERVICE PROVIDER provided a GEMSTAR AUTHORIZED TIVO IPG; any limited sublicenses granted under this Section 3.1(d) shall be [*] to SERVICE PROVIDER AFFILIATES. TIVO shall [*] GEMSTAR as [*] SERVICE PROVIDER [*] GEMSTAR AUTHORIZED TIVO IPG pursuant to this Section 3.1(d). For the avoidance of doubt, TIVO shall have no obligation [*] any [*] or [*] SERVICE PROVIDER DEVICE FEES (as defined in Section 4.4) under this AGREEMENT for any TIVO IPGS or GEMSTAR AUTHORIZED TIVO IPGS that are TRANSFERRED to or by a SERVICE PROVIDER that has a full make, sell and use license under the GEMSTAR IPG-

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

RELATED PATENTS as of the date such payment accrues. The current list of all such SERVICE PROVIDERS is attached hereto as Schedule J. GEMSTAR shall provide TIVO with an updated list in a timely manner should GEMSTAR enter into any such license agreement with any new licensee.

12. Section 3.3(b). This Section is hereby revised to add the following sentence at the end of this provision:

Notwithstanding anything to the contrary in this AGREEMENT, the obligations under this Section 3.3(b) shall not apply to any GEMSTAR AUTHORIZED TIVO IPG licensed by TIVO to a SERVICE PROVIDER for use in a SERVICE PROVIDER DEVICE pursuant to the GEMSTAR IPG-RELATED PATENT license granted under Section 3.1(d).

13. Section 3.4 TIVO SHOWCASES. This Section is hereby revised to add the following sentence at the end of this provision:

Notwithstanding anything to the contrary in this AGREEMENT, the obligations under this Section 3.4 shall not apply to any TIVO SERVICE or other TIVO TECHNOLOGY provided by TIVO to a SERVICE PROVIDER for use in a SERVICE PROVIDER DEVICE pursuant to the GEMSTAR IPG-RELATED PATENT license granted under Section 3.1(d).

14. Section 3.5(a) TRANSFER REQUIREMENTS. This Section is hereby revised to state as follows:

(a) TRANSFER REQUIREMENTS. TIVO agrees it shall [*] SERVICE PROVIDERS. Any TRANSFER [*] shall make [*] DEVICE.

15. Section 3.5(b) NOTICE REQUIREMENTS. This Section is hereby revised to add the following sentence at the end of this provision:

“…update notice from GEMSTAR. For the avoidance of doubt, for SERVICE PROVIDER DEVICES licensed pursuant to the GEMSTAR IPG-RELATED PATENTS licenses granted under Section 3.1(d), such notice language shall be required to be included only in the “SYSTEM INFORMATION” screen or equivalent area of the GEMSTAR AUTHORIZED TIVO IPG.”

16. Section 3.6 SCOPE OF GRANT. The last sentence of this Section is hereby revised to state:

“…paid hereunder. For the avoidance of doubt, TIVO acknowledges that the provision of the GEMSTAR AUTHORIZED TIVO IPG other than in connection with a TIVO SERVICE deployed through TIVO PVR DEVICES or SERVICE PROVIDER DEVICES is not licensed under this AGREEMENT.

17. Section 4.0 FEES. The following new Section 4.4 is hereby added to this Section:

4.4 SERVICE PROVIDER DEVICE FEES. For SERVICE PROVIDER DEVICES, TIVO may [*] or [*]. TIVO shall be required to [*] when it provides GEMSTAR with written notice as to each such SERVICE PROVIDER deploying a GEMSTAR AUTHORIZED TIVO IPG pursuant to Section 3.1(d), and TIVO shall [*] for specific SERVICE PROVIDER during the [*] this AGREEMENT. In no event shall TIVO be required to [*] for the same SERVICE PROVIDER DEVICE.

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

(a) [*]. If TIVO [*], TIVO agrees to [*] GEMSTAR, for each TRANSFERRED SERVICE PROVIDER DEVICE (excluding such devices TRANSFERRED only for testing or demonstration) during the TERM in the TERRITORY, [*] for each [*] SERVICE PROVIDER DEVICE utilizes a GEMSTAR AUTHORIZED TIVO IPG [*]. The [*] shall [*] which such SERVICE PROVIDER DEVICE performs an INITIAL ACTIVATION, [*] to be [*] during [*] during the [*] the SERVICE PROVIDER DEVICE utilizes a GEMSTAR AUTHORIZED TIVO IPG, [*] whether the SERVICE PROVIDER DEVICE utilizes a GEMSTAR AUTHORIZED TIVO IPG for the [*]. The license granted for SERVICE PROVIDER DEVICES for which a [*] will [*], subject to [*] provided for in [*], with the expiration or termination of this AGREEMENT.

(b) [*]SERVICE PROVIDER DEVICE FEES. If TIVO [*] SERVICE PROVIDER DEVICE FEE [*], TIVO agrees [*] GEMSTAR, for [*] SERVICE PROVIDER DEVICE (excluding such devices [*] for testing or demonstration) that performs an INITIAL ACTIVATION during the TERM in the TERRITORY, [*]SERVICE PROVIDER DEVICE [*]. During the TERM, subsequent activations of the same SERVICE PROVIDER DEVICE by another subscriber of a SERVICE PROVIDER shall not require payment of [*] SERVICE PROVIDER DEVICE FEE. The license granted for SERVICE PROVIDER DEVICES for which [*] SERVICE PROVIDER DEVICE FEE [*] will survive the expiration or termination of this AGREEMENT.

(c) NO OTHER FEES. For the avoidance of doubt, the [*] SERVICE PROVIDER DEVICE FEES, [*], shall constitute full payment for the license to the GEMSTAR IPG-RELATED PATENTS and GEMSTAR shall not require any additional fees from TIVO or its SERVICE PROVIDER licensee under any GEMSTAR IPG-RELATED PATENTS with respect to SERVICE PROVIDER DEVICES licensed under this AGREEMENT. TIVO shall have no obligation [*] any [*] SERVICE PROVIDER DEVICE FEES for any GEMSTAR AUTHORIZED TIVO IPGS that are TRANSFERRED to or by a SERVICE PROVIDER that has a full make, sell and use license under the GEMSTAR IPG-RELATED PATENTS as of the date such payment accrues.

(d) [*]. [*] after the AMENDMENT EFFECTIVE DATE, and [*] during the TERM, the [*] SERVICE PROVIDER DEVICE [*].

18. Section 5.1 PAYMENTS. This Section is hereby revised to add a new subsection (c) and to rename the existing subsections (c) and (d) to (d) and (e), respectively:

(c) In addition, within [*] of the close of each [*], TIVO shall [*] GEMSTAR the total of all [*] DEVICE FEES accruing during such [*], based on the report(s) received by TIVO from its SERVICE PROVIDERS licensed pursuant to Section 3.1(d).

19. Section 5.3 PAYMENT REPORTS. This Section is hereby revised to add a new subsection (c) and to rename the existing subsection (c) to (d):

(c) Each payment by TIVO pursuant to Section 5.1(c) hereof shall be accompanied by a written [*] report (i) identifying the number of SERVICE PROVIDER DEVICES [*] (excluding such devices [*] for testing or demonstration) in the TERRITORY (for each licensed SERVICE PROVIDER) during the [*] for which [*] SERVICE PROVIDER DEVICE FEES were [*] paid as further described in Section 4.4(b) with supporting documentation to specifically identify (i.e., by serial number) those SERVICE PROVIDER DEVICES for [*] SERVICE PROVIDER DEVICE FEES have been paid, such documentation to be mutually agreed upon by GEMSTAR

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

and TIVO on a SERVICE PROVIDER by SERVICE PROVIDER basis, prior to TIVO’s [*] payments pursuant to Section 4.4(b), and (ii) identifying the number of SERVICE PROVIDER DEVICES (for each licensed SERVICE PROVIDER) utilizing a GEMSTAR AUTHORIZED TIVO IPG for which [*] as further described in Section 4.4(a), as well as (iii) a calculation of the sum total of [*] SERVICE PROVIDER DEVICE FEES that are being remitted to GEMSTAR hereunder, all of the foregoing on a SERVICE PROVIDER by SERVICE PROVIDER basis.

20. Section 6.1 TERM. This section is hereby revised to state as follows:

6.1 TERM. The term of this AGREEMENT (“TERM”) shall be for [*] years from the EFFECTIVE DATE, unless terminated earlier in accordance with the provisions of Sections 6.2, 6.3 or 6.4 below.

Notwithstanding the foregoing, TIVO may elect to renew the licenses granted under Sections 3.1(d) and 3.3 for SERVICE PROVIDER DEVICES and GEMSTAR AUTHORIZED TIVO IPGs deployed on SERVICE PROVIDER DEVICES for a period of [*] additional years upon the expiration of the current TERM and then for a period of [*]additional years upon the expiration of the extended TERM, up to a total of [*] additional years on the same terms as provided hereunder. During such renewal period, if any, the licenses granted under the AGREEMENT for the TRANSFER of any TIVO PVR DEVICES and any IPGs (including GEMSTAR AUTHORIZED TIVO IPGS) deployed on TIVO PVR DEVICES, and any other terms and conditions related to TIVO PVR DEVICES in any manner, shall [*] unless otherwise agreed to in writing between the PARTIES.

21. New Section 6.4A TERMINATION – SERVICE PROVIDER DEVICES. The following new Section 6.4A shall be added after Section 6.4 and prior to Section 6.5:

6.4A TERMINATION – SERVICE PROVIDER DEVICES. Notwithstanding the termination provisions in Sections 6.2 and 6.3, (i) in the event any such uncured material breach of this AGREEMENT by TIVO is directly attributable to a breach of the rights or obligations relating to the TIVO PVR DEVICE(S), the rights and obligations under this AGREEMENT shall [*] and shall [*] as related to all of the [*]; (ii) in the event any such uncured material breach of this AGREEMENT by TIVO is directly attributable to a SERVICE PROVIDER DEVICE, the rights and obligations under this AGREEMENT shall [*] and shall [*] for all [*]; and (iii) in the event of any such uncured material breach by TIVO of the REMOTE SCHEDULING AMENDMENT to this AGREEMENT dated August 23, 2006, the rights and obligations under this AGREEMENT shall [*] and shall [*] for all [*].

Notwithstanding anything to the contrary in the foregoing, for the avoidance of doubt, TIVO shall be [*] to GEMSTAR for SERVICE PROVIDER DEVICES and GEMSTAR AUTHORIZED TIVO IPGs deployed on SERVICE PROVIDER DEVICES, [*] TIVO and any individual SERVICE PROVIDER. Furthermore, the failure of a SERVICE PROVIDER [*] TIVO for a GEMSTAR AUTHORIZED TIVO IPG deployed on a SERVICE PROVIDER DEVICE shall [*], to GEMSTAR under this AGREEMENT. Moreover, any [*], to GEMSTAR under this AGREEMENT with respect to any and all SERVICE PROVIDERS, if [*] GEMSTAR to [*] AGREEMENT with respect [*] SERVICE PROVIDERS.

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

22. New Section 6.4B SUSPENSION – DELAY IN PROVIDING ACCESS TO REMOTE SCHEDULING. The following new Section 6.4B shall be added after Section 6.4A and prior to Section 6.5:

If a breach by TIVO of its responsibilities and obligations under the REMOTE SCHEDULING AMENDMENT results in GEMSTAR not being provided with access to the TIVO REMOTE SCHEDULING feature within [*] of the effective date of the REMOTE SCHEDULING AMENDMENT to this AGREEMENT dated August 23, 2006, then upon written notice by GEMSTAR to TIVO, the rights granted under Section [*] of the AGREEMENT will be [*] with respect to any SERVICE PROVIDER DEVICES [*] by GEMSTAR above, and GEMSTAR AUTHORIZED TIVO IPGS for such SERVICE PROVIDER DEVICES, [*] of the REMOTE SCHEDULING AMENDMENT.

23. Section 6.6 SELL-OFF PERIOD. This Section is hereby revised to state as follows:

6.6 SELL-OFF PERIOD. Notwithstanding any provision in this AGREEMENT to the contrary, TIVO (and its authorized sublicensees pursuant to Section 3.1(b) and/or 3.1(d), if any) may, for a period of [*] after any applicable termination or expiration of this AGREEMENT (“TERMINATION DATE”), continue manufacturing TIVO PVR DEVICES or SERVICE PROVIDER DEVICES, as applicable, which are in the process of manufacture as of the TERMINATION DATE and may continue the TRANSFER of TIVO PVR DEVICES or SERVICE PROVIDER DEVICES which are so manufactured after the TERMINATION DATE and may also TRANSFER TIVO PVR DEVICES or SERVICE PROVIDER DEVICES which are in stock of TIVO (or its authorized sublicensees pursuant to Section 3.1(b), if any) or SERVICE PROVIDER (or its manufacturer) at the time of the TERMINATION DATE, and continue to use the GEMSTAR MARK as set forth in Section 3.3, provided:

(i) TIVO has paid GEMSTAR all fees and payments due GEMSTAR under this AGREEMENT in accordance with Section 4.1, Section 4.3 and Section 4.4, as may be applicable; and

(ii) TIVO continues to adhere to the terms and conditions of this AGREEMENT, as if such AGREEMENT had not expired including but not limited to making all reports, fees and payments to GEMSTAR in a timely manner.

24. Section 6.7 SURVIVAL. This Section is hereby revised to state as follows:

(a) Termination by GEMSTAR. The following provisions shall survive any termination of this AGREEMENT by GEMSTAR under Section 6.2 or 6.3 above, but only as they relate to the provisions of this AGREEMENT that are terminated pursuant to Section 6.4A: (a) licenses granted under Sections 3.1 and 3.3 during the sell-off period provided for in Section 6.6; (b) licenses granted under Sections 3.1 and 3.3 for any TIVO PVR DEVICES TRANSFERRED during the TERM of this AGREEMENT (but prior to such expiration or termination) or during the sell-off period provided for in Section 6.6 and the GEMSTAR AUTHORIZED TIVO IPG and the TIVO SERVICE provided to such TIVO PVR DEVICES; (c) licenses granted under Section 3.1 for any SERVICE PROVIDER DEVICES, for which [*] SERVICE PROVIDER DEVICE FEE [*] been paid to GEMSTAR, TRANSFERRED during the TERM of this Agreement (but prior to such expiration or termination) or during the sell-off period provided for in Section 6.6 and the

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

GEMSTAR AUTHORIZED TIVO IPG and the TIVO SERVICE provided to such SERVICE PROVIDER DEVICES; (d) during the sell-off period provided for in Section 6.6, the obligations of TIVO under Sections 3.2, 3.3 and 3.4 with respect to the GEMSTAR AUTHORIZED TIVO IPG and TIVO SHOWCASE; (e) Section 5.0 with respect to any fees owed, but not yet paid under this AGREEMENT; (f) Section 6.6 for the term set forth therein; (g) Section 6.7(a); (h) Section 6.8; (i) Section 7; (j) Section 8.2 for any GEMSTAR authorized IPG product TRANSFERRED during the TERM and any GEMSTAR authorized IPG service provided to such GEMSTAR authorized IPG products; and (k) Section 10.

(b) Termination by TIVO or Expiration of AGREEMENT. The following provisions shall survive any expiration of this AGREEMENT or any termination of this AGREEMENT by TIVO under Section 6.2 or 6.4 above: (a) licenses granted under Sections 3.1 and 3.3 during the sell-off period provided for in Section 6.6; (b) licenses granted under Sections 3.1 and 3.3 for any TIVO PVR DEVICES TRANSFERRED during the TERM of this AGREEMENT (but prior to such expiration or termination) or during the sell-off period provided for in Section 6.6 and the GEMSTAR AUTHORIZED TIVO IPG and the TIVO SERVICE provided to such TIVO PVR DEVICES; (c) licenses granted under Section 3.1 for any SERVICE PROVIDER DEVICES, for which [*] SERVICE PROVIDER DEVICE FEE [*] been paid to GEMSTAR, TRANSFERRED during the TERM of this Agreement (but prior to such expiration or termination) or during the sell-off period provided for in Section 6.6 and the GEMSTAR AUTHORIZED TIVO IPG and the TIVO SERVICE provided to such SERVICE PROVIDER DEVICES; (d) during the sell-off period provided for in Section 6.6, the obligations of TIVO under Sections 3.2, 3.3 and 3.4 with respect to the GEMSTAR AUTHORIZED TIVO IPG and TIVO SHOWCASE; (e) Section 5.0 with respect to any fees owed, but not yet paid under this AGREEMENT; (f) Section 6.6 for the term set forth therein; (g) Section 6.7(b); (h) Section 7; (i) Section 8.2 for any GEMSTAR authorized IPG product TRANSFERRED during the TERM and any GEMSTAR authorized IPG service provided to such GEMSTAR authorized IPG products; and (j) Section 10.

(c) Survival of Limited License for Certain Deployed SERVICE PROVIDER DEVICES. The licenses granted under Sections 3.1(d) and 3.3 for any SERVICE PROVIDER DEVICES for which TIVO has [*] shall survive for a period of [*] after the date of expiration or termination of this AGREEMENT, so long as [*] in accordance with [*] then-current as of the date of the end of the sell-off period in Section 6.6 [*] upon the expiration date of such sell-off period and, during such [*] period, such [*] shall continue to be subject to [*] in accordance with [*]. For the avoidance of doubt, the survival of the limited license as described in this Section 6.7(c) shall only apply to existing subscribers of a SERVICE PROVIDER who receive a GEMSTAR AUTHORIZED TIVO IPG as of the date of expiration or termination of this AGREEMENT or during the sell-off period provided for in Section 6.6 and shall not apply to new subscribers of a SERVICE PROVIDER who receive a GEMSTAR AUTHORIZED TIVO IPG after the expiration date of the sell-off period provided for in Section 6.6 of this AGREEMENT.

25. Section 9.1 [*]. This Section is hereby revised to add the following sentences at the end of this Section.

Notwithstanding anything to the contrary in this AGREEMENT, the obligations under this Section 9.1 shall not apply to any GEMSTAR AUTHORIZED TIVO IPG licensed by TIVO to a SERVICE PROVIDER for use in a SERVICE PROVIDER DEVICE pursuant to the GEMSTAR

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

IPG-RELATED PATENT license granted under Section 3.1(d). Accordingly, TIVO understands and acknowledges that, with respect to any GEMSTAR AUTHORIZED TIVO IPG provided by TIVO to a SERVICE PROVIDER, the grant of rights under the GEMSTAR IPG-RELATED PATENTS shall [*] rights to [*] in such GEMSTAR AUTHORIZED TIVO IPGs. Such rights [*] under the GEMSTAR IPG-RELATED PATENTS with respect to any GEMSTAR AUTHORIZED TIVO IPG provided by TIVO to a SERVICE PROVIDER are [*] GEMSTAR and [*], to TIVO or such SERVICE PROVIDER under this AGREEMENT.

26. Section 9.4 TIVO REMOTE SCHEDULING. This Section is hereby deleted in its entirety as the PARTIES have entered into a separate amendment regarding the deployment of remote scheduling from tvguide.com.

27. [*]. For the avoidance of doubt, the terms and conditions of the TV Guide [*], including but not limited to [*], shall not apply in any way to SERVICE PROVIDER DEVICES.

28. Effect of Amendment. All terms and conditions of the AGREEMENT shall remain in full force and effect, unless expressly modified and amended by this AMENDMENT.

29. Precedence. In the event of any inconsistency or conflict between the terms and conditions of this AMENDMENT and the ORIGINAL AGREEMENT, the terms and conditions of this AMENDMENT shall govern and control.

IN WITNESS WHEREOF, the PARTIES hereto have caused this AMENDMENT to be executed by their respective duly authorized representatives to be effective as of the date first written above.

GEMSTAR-TV GUIDE INTERNATIONAL, INC.		TIVO INC.
By:	/s/ Mike McKee	By:	/s/ Matthew Zinn
Printed Name:	Mike McKee	Printed Name:	Matthew Zinn
Title:	Chief Operating Officer	Title:	SVP, General Counsel
Date:	8/23/06	Date:	8/23/06

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

SCHEDULE J

1. Comcast Corporation

2. DIRECTV, Inc.

3. Echostar Communications Corporation

4. Time Warner Cable, Inc.

EX-10.4

Exhibit 10.4

Confidential treatment has been requested for portions of this exhibit. The copy filed herewith omits

the information subject to the confidentiality request. Omissions are designated as [*]. A complete

version of this exhibit has been filed separately with the Securities and Exchange Commission.

REMOTE SCHEDULING AMENDMENT TO

TIVO INTERACTIVE PROGRAM GUIDE

LICENSE AGREEMENT

THIS REMOTE SCHEDULING AMENDMENT TO THE TIVO INTERACTIVE PROGRAM GUIDE LICENSE AGREEMENT (this “AMENDMENT”), having an effective date of August 23, 2006 (“AMENDMENT EFFECTIVE DATE”) amends the TiVo Interactive Program Guide License Agreement having an effective date of June 6, 2003 (the “RETAIL AGREEMENT”), as amended by the Service Provider Amendment, having an effective date of August 23, 2006 (the “SERVICE PROVIDER AMENDMENT,” the RETAIL AGREEMENT, as amended by the SERVICE PROVIDER AMENDMENT shall be referred to as the “AGREEMENT”) and is made and entered into by and between GEMSTAR – TV GUIDE INTERNATIONAL, INC., including all of its SUBSIDIARIES (hereinafter collectively referred to as “GEMSTAR”), and TIVO INC., including all of its SUBSIDIARIES (hereinafter collectively referred to as “TIVO”). All capitalized terms used in this AMENDMENT and not otherwise defined herein shall have the meaning defined in the AGREEMENT.

RECITALS

The PARTIES desire to amend the AGREEMENT in accordance with the terms and conditions set forth herein in order to revise and clarify the obligations of the PARTIES with respect to the deployment of TIVO’s remote scheduling feature accessible from GEMSTAR’s tvguide.com website.

AMENDMENT

1. Section 2 of the AGREEMENT is hereby revised to incorporate the following new definition as new Section 2.30A.

2.30A “TIVO REMOTE SCHEDULING” shall mean scheduling the recording of television programs solely to a TIVO PVR DEVICE via the internet, as accessed through a personal computer (regardless of operating system or hardware) and displayed via a standard internet web browser application.

2. Section 9.4 of the AGREEMENT is hereby deleted and replaced in its entirety with the following:

9.4 REMOTE SCHEDULING. TIVO hereby agrees to provide GEMSTAR with access to the TIVO REMOTE SCHEDULING feature solely for access from GEMSTAR’s tvguide.com website as soon as commercially possible, but in any event within [*] of the AMENDMENT EFFECTIVE DATE, subject to each PARTY fulfilling its responsibilities and obligations set forth in the PROJECT PLAN (as defined below), and shall continue to support TIVO REMOTE SCHEDULING through the expiration of the current TERM of the RETAIL AGREEMENT, unless terminated earlier in accordance with the provisions of Sections 6.2, 6.3 or 6.4 of the AGREEMENT. Upon thirty (30) days’ written notice to TIVO prior to the expiration of the current TERM, GEMSTAR may elect to renew this AMENDMENT for a period of [*], which renewal, in and of itself, will not result in a renewal or extension of the TERMS, or any rights granted to TIVO [*]. For the avoidance of doubt, GEMSTAR shall have the option to elect to renew this AMENDMENT and the corresponding support for TIVO REMOTE SCHEDULING from GEMSTAR’s tvguide.com website as set forth above even if (1) the PARTIES are not able to renew or extend the licenses granted to TIVO [*], and/or (2) TIVO elects not to renew the licenses granted to TIVO [*].

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

Following are the terms and conditions under which GEMSTAR will provide TIVO with certain specifications on its data structure and TIVO will develop a data mapping tool and any other customized tools or related documentation required to enable GEMSTAR’s access to the TIVO REMOTE SCHEDULING feature from GEMSTAR’s tvguide.com website (the “TOOLS”).

a. PROJECT PLAN. The plan attached hereto as Schedule A (the “PROJECT PLAN”) sets forth the specific responsibilities and obligations that must be delivered by each PARTY and the completion dates for each task.

b. COSTS. All costs incurred in the development and maintenance of the TOOLS and operation of the TIVO REMOTE SCHEDULING feature from GEMSTAR’S tvguide.com website shall be borne by [*] as set forth in the PROJECT PLAN or who is otherwise specifically responsible for such development and maintenance. However, if the maintenance costs borne by TIVO in order to support TIVO REMOTE SCHEDULING from the tvguide.com website exceed [*], GEMSTAR shall either pay the excess or TIVO shall have the right to terminate the TIVO REMOTE SCHEDULING functionality. For the avoidance of doubt, the maintenance costs to be considered shall only include maintenance costs directly related to enabling TIVO REMOTE SCHEDULING via tvguide.com.

c. OWNERSHIP. Any rights and intellectual property associated with and/or incorporated in the TOOLS developed hereunder shall be owned solely by TIVO. For the avoidance of doubt, this shall not include any rights in the GEMSTAR IPG-RELATED PATENTS or other intellectual property owned or controlled by GEMSTAR prior to the development of the TOOLS.

d. LIMITED USE OF TOOLS BY TIVO. TIVO hereby agrees that its use of any portion of the TOOLS that is specific to the GEMSTAR data structure shall be limited solely to the extent necessary to enable GEMSTAR to access the TIVO REMOTE SCHEDULING feature from GEMSTAR’s tvguide.com website during the TERM. TIVO shall not use any portion of the TOOLS that is specific to the GEMSTAR data structure for any other purpose.

e. LIMITED LICENSE TO USE TIVO TRADEMARK. Subject to the terms and conditions of this AGREEMENT, TIVO hereby grants to GEMSTAR a limited, nonexclusive, fully-paid, nontransferable, non-sublicensable royalty-free right and license to use the TIVO logo solely in association with the TIVO REMOTE SCHEDULING feature as expressly required by this AGREEMENT and in accordance with TIVO’s standard trademark usage guidelines as published at http://www.tivo.com/resources. TIVO may terminate the license granted in this Section 9.4.e immediately upon written notice to GEMSTAR in the event of any unauthorized use of the TIVO logo or other breach of this Section 9.4.

f. BRANDING. GEMSTAR shall display the TIVO logo [*] of the TIVO REMOTE SCHEDULING features by END-USERS of a TIVO PVR DEVICE in a [*] by the PARTIES. GEMSTAR shall submit a sample of the proposed placement of the TIVO logo to TIVO for its approval, such approval not to be unreasonably withheld, so long as the TIVO logo is [*] placed [*] and is used solely in conjunction with remote scheduling for TIVO PVR DEVICES.

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

g. ADVERTISING. Notwithstanding anything to the contrary in this AGREEMENT, GEMSTAR shall not use the TIVO REMOTE SCHEDULING feature within any [*] (or otherwise in a manner that would suggest that the TIVO REMOTE SCHEDULING feature is associated with any of the foregoing), whether or not such third party purchases such [*], without the prior written consent of TIVO, which consent may be withheld in TIVO’s sole discretion.

h. PRESS RELEASE. Following execution of this AMENDMENT, the PARTIES shall issue a mutually approved joint press release stating their intention to enable the TIVO REMOTE SCHEDULING functionality on the tvguide.com website.

i. CONFIDENTIALITY. The TOOLS and any information exchanged by the PARTIES in order to accomplish the tasks set forth in the PROJECT PLAN shall be deemed “CONFIDENTIAL” as that term is used in the AGREEMENT.

3. Each of the PARTIES hereto represents that it has the right to perform its obligations under this AMENDMENT.

4. Effect of Amendment. All terms and conditions of the AGREEMENT shall remain in full force and effect, unless expressly modified and amended by this AMENDMENT.

5. Precedence. In the event of any inconsistency or conflict between the terms and conditions of this AMENDMENT and the AGREEMENT, the terms and conditions of this AMENDMENT shall govern and control.

IN WITNESS WHEREOF, the PARTIES hereto have caused this AMENDMENT to be executed by their respective duly authorized representatives to be effective as of the date first written above.

GEMSTAR-TV GUIDE INTERNATIONAL, INC.		TIVO INC.
By:	/s/ Mike McKee	By:	/s/ Matthew Zinn
Printed Name:	Mike McKee	Printed Name:	Matthew Zinn
Title:	Chief Operating Officer	Title:	SVP, General Counsel
Date:	8/23/06	Date:	8/23/06

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

PROJECT PLAN

[*]

[*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

EX-31.1

EXHIBIT 31.1

Certification of Chief Executive Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Thomas S. Rogers, certify that:

1) I have reviewed this quarterly report on Form 10-Q of TiVo Inc.;

2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4) The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5) The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: September 11, 2006

/s/ THOMAS S. ROGERS

Thomas S. Rogers

President and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

Certification of Chief Financial Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Steven J. Sordello, certify that:

1) I have reviewed this quarterly report on Form 10-Q of TiVo Inc.;

2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4) The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5) The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: September 11, 2006

/s/ STEVEN J. SORDELLO

Steven J. Sordello

Senior Vice President and

Chief Financial Officer

(Principal Financial and Accounting Officer)

EX-32.1

EXHIBIT 32.1

Certification of Chief Executive Officer

Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the TiVo Inc. (the “Company”) Quarterly Report on Form 10-Q for the period ending July 31, 2006 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Thomas S. Rogers, Chief Executive Officer of the Company, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company at the dates and for the periods indicated.

Date: September 11, 2006

/s/ THOMAS S. ROGERS

Thomas S. Rogers

President and Chief Executive Officer

EX-32.2

EXHIBIT 32.2

Certification of Chief Financial Officer

Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the TiVo Inc. (the “Company”) Quarterly Report on Form 10-Q for the period ending July 31, 2006 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Steven Sordello, Chief Financial Officer of the Company, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:

3. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

4. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company at the dates and for the periods indicated.

Date: September 11, 2006

/s/ STEVEN J. SORDELLO

Steven J. Sordello

Senior Vice President and

Chief Financial Officer

(Principal Financial and Accounting Officer)