Digital video recorder maker TiVo Inc. (NASDAQ: TIVO) announced this morning that it had settled a pending patent suit against Verizon Communications Inc. (NYSE: VZ) and that the two companies have entered into a mutual patent licensing deal.
Under the terms of the settlement, Verizon will pay TiVo $250.4 million in addition to monthly licensing fees through July 2018. Part of the deal also involves distribution of streaming video through Verizon’s joint venture with Coinstar Inc. (NASDAQ: CSTR) and that company’s Redbox video rental kiosks. According to the announcement:
Verizon and TiVo are exploring, among other things, future distribution of Internet video services developed through Verizon’s joint venture with Redbox by making content distributed via that service part of the diverse selection of linear and broadband-delivered content accessible to users of TiVo’s retail DVR products.
TiVo’s president and CEO said:
As with prior settlements, we also benefit by being able to operate our business under license from Verizon and by avoiding future legal expenses that we would have incurred during and after trial. Furthermore, we believe this settlement positions us well with respect to future enforceability of our patents.
TiVo’s stock is up 9.3% in premarket trading this morning at $10.45 in a 52-week range of $7.75 to $12.37.