TiVo Partners with PayPal to Create Interactive Ads

   By Victoria Stilwell 
 

TiVo Inc. (TIVO) is pairing with eBay Inc.'s (EBAY) payment service PayPal to offer its users a way to pay for products featured in interactive advertisements.

The digital-video-recorder company is working with advertisers and agencies to develop PayPal-enabled advertisements, which are expected to begin airing during the fall 2012 television season.

The advertisements allow TiVo users to buy products through interactive advertisements. The purchases will then be charged to the TiVo user's PayPal account and shipped to the address the user has registered with the payment service for deliveries.

"In today's fragmented TV viewing world it is harder than ever before for advertisers to reach their audiences, and it's important to find creative ways to get in front of viewers," said Tara Maitra, TiVo's general manager for content and media sales. "TiVo's interactive ads allow advertisers to grab the attention of viewers in unobtrusive ways and on the viewer's terms."

TiVo unveiled the plans during the TV of Tomorrow Show in San Francisco.

TiVo has mostly posted losses since the second half of 2009 as rising costs and dwindling subscriber numbers had pressured its bottom line, however, two far-reaching settlements over the use of TiVo's recording technology significantly boosted the company's results in the year-ago quarter and the fourth quarter.

TiVo in May swung to a fiscal first-quarter loss as a patent-litigation settlement padded the company's year-ago results, but the company recorded subscriber growth.

TiVo's efforts to deploy its devices with more pay-TV operators has helped it drive net subscription growth recently. The company has now recorded subscriber growth for three consecutive quarters, following a four-year streak of declining subscriber numbers.

Meanwhile, PayPal has been working with major retailers to introduce in-store electronic-payment systems using its technology. The payment service has helped drive growth at its parent company.

EBay's first-quarter profit rose 20% on continued strength in the company's payments business, and prompted the company to boost its outlook for the year.

Shares of TiVo slipped 0.2% to $8.05 in recent trading, and shares of eBay fell 0.6% to $40.69. TiVo's stock is off 21% during the past 12 months, while eBay's has risen near 36% in the same time period.

Write to Victoria Stilwell at [e-mail]