Blockbuster Gets TiVo on Demand

In a move to take video rental to the next level, the two companies have agreed to work together to deliver "video on demand," a much-discussed millennial convenience. Subscription-based TV service TiVo, a company that enables customers to pause and rewind live TV, will team up with video rental company Blockbuster to expand Blockbuster's video rental business to an entertainment service delivered through TiVo.

"This alliance with the world's leading retailer of home video, DVDs and video games is another step toward providing our customers with control over how, when and what they watch on TV," said Morgan Guenther, TiVo's VP of business development, in a statement. The two firms said the service would allow TiVo subscribers to get a selection of movies for viewing through TiVo receivers.

The alliance also provides each company with attractive cross-promotional opportunities. TiVo will be able to set up demo kiosks in Blockbuster stores across the U.S. and promote offers on TiVo receivers to the 85 million Blockbuster members around the world. Blockbuster plans to use the TiVo system to show movie trailers and provide information about upcoming video releases that will be available in its stores.

Eventually, consumers will be able to reserve movies either for pick-up at Blockbuster stores or for viewing through their TiVo receivers, the companies said.

Sunnyvale, Calif.-based TiVo isn't alone in trying to interest consumers in the convenience of pausing and rewinding live TV. Mountain View, Calif.-based Replay is also vying to win people over to the world of "personal TV." TiVo also faces competition from the up-and-coming digital video recorders, devices that allow users to pause and rewind TV by recording video streams to a DVR hard drive.

The Blockbuster-TiVo alliance shows a willingness on the part of traditional entertainment companies to experiment with interactive TV. Separately, TiVo announced agreements with AOL and Liberate Technologies, which makes software for delivering Internet content to appliances. The companies plan to incorporate interactive experiences into the AOLTV-viewing experience.

The cost of a TiVo box, which can record 14 hours of video, is $499.

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