The decision won't get TiVo into EchoStar's machines. Consider that bridge burnt. But investors likely believe the ruling will strengthen TiVo's hands in negotiations with other pay-TV providers, who may fear a patent suit if they don't get in bed with TiVo. Already, TiVo provides software for Comcast DVRs.

TiVo has been pinning its hopes on a new contract with Comcast and a new emphasis on selling ads. But hopes had run high that TiVo would make up with DirecTV. The two companies were strong partners early in TiVo's life, but their relationship has been on the rocks since 2004. Why would DirecTV want to put TiVo in its boxes now, when it can use ReplayTV software for free?

The TiVo service on Comcast is expected to launch shortly in its initial market, Comcast's New England Division, which includes metro Boston, Southeast Massachusetts, and New Hampshire, with the rollout process expected to continue throughout the fall. Activities, including trials, related to the TiVo service on Cox are expected to commence during our fiscal year ending January 31, 2008. We anticipate receiving cash payments for providing the TiVo service as a result of these deployments and expected subscription adoptions but do not expect to recognize a significant portion of these cash payments as service revenues during this fiscal year. Under the accounting guidance for multiple element arrangements, since the contracts contain undelivered elements such as future software development for which we do not have fair value, significant portions of these cash payments must be deferred and recognized ratably over the term of the agreement.

Services like iTunes, working with the Apple TV set-top box, and Xbox 360's Marketplace, offer a limited but growing library of TV shows and movies. Netflix, the DVD rent-by-mail service, is hiring hardware engineers. Amazon, currently a TiVo partner, is rumored to be working on a media-playing device of its own. And more networks are beefing up Web-enabled viewing like ABC's HD-like experience and ESPN 360. To top it off, there's the enigma that is Vudu, a set-top box that's built to replicate Netflix's level of service by offering a host of first-run, DVD-quality movies.

What TiVo has going for it is its ability to record live broadcasts, much of which never turns up on DVD or online video libraries. It also has mainstream appeal compared to Web-video downloads or multitasking game consoles and personal computers. But increasingly, it's going to be hard to convince consumers to buy a separate gadget and make room for it in their living room, when the devices they already have — PCs, game consoles, and even portable media players — can provide the same basic service of delivering video.

Microsoft, in particular, is trying to market the Xbox as a set-top box replacement, especially for phone companies trying to deliver video over Internet connections, a technology known as IPTV. That, more than anything, is what's likely spurring Sony's DVR move — and with Sony, Apple, and Microsoft sparring over the living room, there's going to be little room left for TiVo.