DirecTV Shelves Its Microsoft Media PlansDirecTV Shelves Its Microsoft Media Plans

Today I learned through Ed Bott's blog that DirecTV has dropped its plans to release HD tuner hardware for Windows Media Center. Although the company just confirmed the news, there already were a few hints that DirecTV might lose its enthusiasm for a Media Center solution.The DirecTV HDPC-20 tuner project for Media Center was announced way back at the Consumer Electronics show in January 2006. There was a glimmer of hope that it was progressing because a driver was spotted in the Windows 7 pre-beta handed out at Microsoft's Professional Developer Conference in October. Still, it's hard to see that DirecTV had any sense of urgency or desire to ship a product after three years of work.

Meanwhile, the competition wasn't standing still. Back in September, Engadget noted that DirecTV was planning a new TiVo DVR offering. That is in addition to DirecTV's own DVR. So, with two DVRs already in its lineup, the company may have decided that a third wouldn't be necessary, or even all that useful to its customers.

I wonder, however, whether TiVo may have been doing some behind-the-scenes arm twisting. The company just reported a second profitable quarter, but there's a footnote. If not for a big payoff from a successful patent-infringement suit against Dish Network, TiVo would have been in the red for the quarter. Worse, the company has been losing subscribers; given the economy, it's unlikely it will be able to raise rates to increase revenue and turn that around.

So, TiVo has a big stake in trying to grab as many customers as possible when its new DirecTV HD offering arrives early next year. The switch to digital TV in February may create an opportunistic bump to help it as well. With that in mind, TiVo may have offered DirecTV some monetary incentives such as a larger cut of subscription revenue to keep Microsoft out of the mix.