The tech-watching crew at CNET's News.com isn't the type to blow smoke at the market. That's why I took a great deal of interest in an article yesterday claiming that two different sources had TiVo (Nasdaq: TIVO ) meeting with both Google (Nasdaq: GOOG ) and Yahoo! (Nasdaq: YHOO ) to seek out a partnership, an equity investment, or an outright acquisition.
What do the two search giants see in TiVo? Well, lately, Google and Yahoo! have been a lot like that freaky well-dwelling Samara Morgan kid from The Ring movies, trying to move off the screen and make a difference in the real world. For Google and Yahoo! that has meant being willing to take on Microsoft (Nasdaq: MSFT ) in launching desktop search software, and now both companies have been turning their attention to archiving video broadcasts.
Will Internet-enabled TiVo subscribers be able to scour this growing video content collection and download it directly to their TiVo boxes? That's what the News.com article seems to be proposing. If you connect the dots, a deal like this would put TiVo right at the front porch of video-on-demand, something that it has been developing in cahoots with Netflix (Nasdaq: NFLX ) but that always seemed more like lip service than a practical near-term reality. Well, apparently, it's a lot closer than we think.
Yet missing in all of this speculation is what I think is the real reason Google or Yahoo! may be warming up to TiVo. When TiVo first started experimenting with small ads during its user rebroadcasts last month, our own Tim Beyers called the practice "channeling Google" because it gave TiVo the right to serve up fresh, targeted ads the way that Google does with its AdWords contextual advertising service.
While Google has already hooked up with Comcast (Nasdaq: CMCSA ) and DirecTV (NYSE: DTV ) to eventually start selling some of the TiVo ad space, one would think that companies like Google and Yahoo! -- which derive the bulk of their profits from serving up perfectly targeted text ads online -- would jump at the chance to crawl out of your computer monitor and hang out in the roomier digs of your plasma television set.
It's still too early to tell how this will all end up, but it definitely merits some attention. Just make sure you make that copy of the tape within seven days. Samara is watching.
Some recent TiVo tidbits:
Longtime Fool contributor Rick Munarriz does have a TiVo, but he does not own shares in the company. He does own shares in Netflix.The Fool has a disclosure policy. He is also part of theRule Breakersnewsletter research team, seeking out tomorrow's ultimate growth stocks a day early.