SonicBlue (Replay/Rio) Bought By D&M

An anonymous reader writes "Here's the announcement that many have been waiting for all week. Yesterday, the ReplayTV and Rio product lines of now-defunct SonicBlue were auctioned off in a bankruptcy court. Despite earlier negotiations failing to result in a deal, the Japanese holding company D&M, makers of high-end Denon and Marantz stereo gear, bought the product lines for $36.2 million. The big question is what about all of the "lifetime subscriptions" that people bought? No answers as of yet, but we can all be hopeful."

That's not much money

[Ignorant Aardvark]

Only $36.2 million? That's really not that much for an entire line of TiVO-like products. It sounds to me like D&M might make a killing off this investment, if they play their cards right.

Lifetime?

[Good Sumerian]

Lifetime support has always meant the lifetime of the company. They got what they paid for; it was a gamble, and, unfortunately, they lost.

Hi-fi buys lo-fi

[southpolesammy]

Interesting....this is a paradigm shift for D&M, as they've typically invested their R&D on the high-end of the audiophile spectrum. I'm somewhat perplexed by what they hope to accomplish with buying a line of low-end audio devices...

Lifetime Activation

[Christopher_G_Lewis]

INAL, but if D&M continues the ReplayTV "Name" (ie, they purchased the name, not just the products) then they should have to honor the agreement. If the company all of a sudden become "D & M R-TV", or even "ReplayTV+" then the current owners might be screwed. Hopefully, they'll honor the current agreement, or only charge a small "transfer" fee.

From the service agreement...
SonicBlue [sonicblue.com]

REPLAYTV Digital Video Recorder

Activation and Service Agreement

This Agreement applies to your use of the ReplayTV Service and is a legally binding agreement between you, SONICblue Incorporated and its wholly owned subsidiary, ReplayTV Inc. (collectively "ReplayTV"). By clicking the button marked "I Agree" below or by otherwise communicating your acceptance to ReplayTV or by using the ReplayTV Service, you agree to all the terms and conditions in this Agreement. IMPORTANT NOTE: Your ReplayTV digital video recorder works only by activating and receiving the ReplayTV Service offered and provided by ReplayTV. If you do not agree with all the terms and conditions of this Agreement, you are not authorized to use the ReplayTV Service, and you may return the ReplayTV unit to ReplayTV or the authorized retailer from whom you purchased the product for a full refund within one (1) month of the original purchase date.

S.O.L.

[Anonymous Coward]

The big question is what about all of the "lifetime subscriptions" that people bought?

I'm pretty sure D&M would've had to have bought out any and all contracts that SonicBlue had held, too. If they haven't bought the company outright, I don't think they're obligated to any service contracts or anything like that.

As somebody pointed out above, a lifetime contract means the lifetime of the company. Pretty rare that you'll find a sucker willing to take on the responsibility of assisting a previously installed user base-- it's usually not worth the money.

lifetime

[ih8apple]

I've been a replaytv user for 3+ years and considering how much effort it takes to support the subscriptions, I'm assuming they will honor the lifetime subscriptions to keep customers loyal.

I mean, how much effort could it take to download a bunch of schedules from tvguide or whoever, encrypt them into the proprietary replaytv format, and put them on an FTP site. For the broadband users, they're done. For dialup, they need a simple agreement with a national ISP to support a few thousand 5 minute calls every night.

Re:Too bad

[evilviper]

Unfortunately, it just doesn't work out very well just yet. TV-out devices available for Linux have poor quality, as do the TV tuners available. I've tried. I'm still hoping somebody from gatos will change their minds on TV-out and get the AiW 8500DV working... Supposed to be near-DVD quality output, but lack of drivers screws Linux over again.

Now, this entire situation will be reversed once HDTV gains popularity. Then, input and output will both already be digital, and your computer will have no trouble. That is still assuming that an unrestricted HDTV tuner will be available, and Linux drivers will exist. But, until then (years from now), TVs and Linux PCs won't get along well together.

Philips and Marantz

[Anonymous Coward]

Philips owns a significant part of Marantz, you know.

http://www.twice.com/index.asp?layout=story_stocks &articleid=CA66618

Re:Hi-fi buys lo-fi

[Drakino]

I'm somewhat perplexed by what they hope to accomplish with buying a line of low-end audio devices...

SonicBlue fired all the low end audio people a while back, leaving the audio engineers in the UK (The empeg folks). They are very capable of delivering quality high end devices if so requested. I believe the empeg sound system came close to any high end ($1000 and up) in dash stereo unit for potential audio output quality.

Hopefully this means the empeg Mark 3 might see the light of day.

Re:Hi-fi buys lo-fi

[NetJunkie]

You'll probably see these come back as Philips branded devices, assuming they don't have a exclusive agreement with TiVo. A lot of Denon/Marantz products are released in a lesser form as Philips... My Marantz remote control is almost exactly the same as the Philips TSU-2000 remote.

Re:Philips and Marantz

[matthew.thompson]

I believe that story is now out of date the www.marantz.com site now states, under their History link.

MARANTZ TODAY

The Philips period ended in 2001 when Marantz Japan Inc. acquired the brand and all overseas sales subsidiaries. Today, Marantz falls under D&M Holdings, a joint holding company set up in 2002 to integrate Marantz and Hi-Fi manufacturer Denon in a strategic union that will strengthen both companies in the current tough economic climate. The company employs more than 1600 people in over fifty countries. It carefully selects its dealers to ensure that the quality of the service they provide matches the quality of the products Marantz produces. A dealer must satisfy strict requirements regarding demonstration facilities and store layout before Marantz products can be sold.

Re:That's not much money

[Scyber]

Yes, but SB was already saddled with debt when they bought ReplayTV. Then they developed the newer 4k and 5k units. So they probably never got a chance to recoup there R& D costs

D&M already has a viable product design, they just need to keep the software updated.

Re:Philips and Marantz

[Anonymous Coward]

"&M Holdings Inc. will establish a new head office in Sagamihara City, Japan, with Kabumoto as the new president and CEO of the company. Sakamoto will be installed as the new president and CEO of Denon, and Takashi Sato will serve as the new president and CEO of Marantz. All shares of Marantz and Denon will be transferred to D&M Holdings, making Denon and Marantz wholly owned subsidiaries. Marantz shareholders will receive one share of D&M Holdings per share of Marantz stock, and Denon shareholders will get 0.4416 shares for every share of Denon stock. Ownership by Marantz shareholders and Denon shareholders in D&M Holdings will be 30 percent and 70 percent respectively, which means Philips and Ripplewood will have stakes of 14.7 percent and 68.6 percent in the new company."

As of Apr02...

Re:Hi-fi buys lo-fi

[Anonymous Coward]

D&M aren't high-end. They're middle-range. Think Meridian and TAG and such for high-end.

Re:Lifetime Activation

[Anonymous Coward]

This is an asset sale not a stock transaction. Certain assets of SonicBlue (apparently including it's Rio and ReplayTV technology, trademarks and customer list) were purchased by D&M.

D&M is *not* SonicBlue's legal successor and will *not* assume SonicBlue's liabilities. The "lifetime" service people are just a few of many SonicBlue creditors who are going to lose here. It's unfortunate but they are no more deserving than the unpaid vendors and creditors that get burned in any bankruptcy. We should just be happy that the product line was picked up by a firm with the apparent resources to continue the scheduling service and to continue to develop the software. Tivo's software has pulled ahead in recent weeks. I'm hoping for big things from the next software update on the Replay.

Re:Lifetime?

[BreadMan]

Says the article:

D&M Holdings said it bought inventory, receivables, intellectual property and capital equipment, and that it would also take over certain contractual relationships and liabilities.

I'm guessing that "certain contractual relationships" means customer agreements.

I don't see the business case of buying a hardware company that relies on subscriptions and then stiffing your subscribers. If you manage not to upset your subscribers, you have a good pool of people you can up-sell something to in the future. Plus, the nice word-of-mouth referrals will help pick-up business from new customers.

Think $$$: Why wouldn't they keep their commitment

[evenparity]

If D&M are going to continue the Replay line, they would be crazy not honor Rio's lifetime subscriptions. Subscribers are assets.

Not only do you get a chance to upgrade them to next model, the eyeballs themselves must have some value. Marketing departments are constantly trying to develop channels like these subscriptions, and they are willing to pay for them.

It costs big $$$ to develop the guide data, but costs very little to distribute it more widely to these lifetime subscribers. By not honoring the agreement, it will cost them a lot in goodwill.

Of course, I can see them maybe offering lifetime subscribers a year or two of free service and then maybe making them pay, too. But it seems like there is an advantage of not making these people feel cheated. Cheated customers never return and they complain a lot (LOUDLY!).

(I'm glad I am a happy Tivo user.)

Re:Too bad

[Anonymous Coward]

No. TV-out devices and TV tuners available as add-ons to PC's are typically of poor quality. The poster is correct in their assertion that this becomes less of a problem as things go digital, but still a problem nonetheless. Large amounts of the poorness of quality on PC components is because of the sheer amount of electrical and RF noise inside a PC.

There are many Set Top Boxes available that currently run Linux on IBM PPC cores, which have fantastic video output quality, and all the features you would expect. BECAUSE THE HARDWARE IS DESIGNED FOR IT.

The OS you're running has zilch to do with generating a quality TV output. Hardware designed by monkeys who say "yeah, that's looks like a TV picture, ship it" is more likely the cause.

Re:Too bad

[dirty]

Why does everyone think that this is the end of ReplayTV? So far everything looks like it's not going anywhere, and that there will probably be a lot more developement on the ReplayTV line. People were making the same comments two weeks ago when the deal between SonicBLUE and D&M "fell through". I think D&M was offering $40mil then. Yesterday they paid $36.2mil. That's $3.8mil more cash D&M has now. How is that a bad thing?

Re:D&M made a good purchase

[MortisUmbra]

Erm, how is it someone elses service? They bought that "someone else" so it's THEIR service. The point here is that D&M don't HAVE to make their own service, because they bought someone elses service, so all that infrastructure work with channel guide updating, and so on, and hardware design, os customization,menu building, it's already done. Otherwise they would have just made their own from scratch.

There is absolutely no reason to buy a company who's assets contain everything you need from top to bottom to get a functional PVR out the door, and then change crap so it becomes "yours".

It already IS yours. Any changes you make to the system (outside of new features and whatnot) is just making life harder for you than it needs to be.

It would be like me buying, oh, GM, then changing the engine bays so they don't fit the standard GM engines anymore, then making my own engine just to put it in the car and say it's "my engine".

Why dothat? It's stupid, just use the engines and bays and layouts you paid for.

Re:OT: Re:Hi-fi buys lo-fi

[hudsonhawk]

While their sub has a lot of gee-whiz cool to it (a 12" cube! that's so cool!) they're amps and preamps, imho, are mediocre, considering what they cost. If you're looking for high-end home theater amps / preamps, look no further than B&K. If you're looking for just a high-end audio system, for the same price as the Sunfire stuff, you could get yourself into some entry-level Audio Research and Conrad-Johson eletronics.

But I've never been a fan of that all-flash, no substance Carver / Sunfire sound. To each his or her own.