Macrovision makes small buy for big ambitions

In spite of a 40% drop in its stock since plunking down $2.8bn for Gemstar-TV Guide in December 2007, Macrovision continued its push into online TV distribution markets with the asset purchase of ThoughtWorthy Media last Friday. Without giving too many details on its plans, the digital content protection company said the deal will provide its property with a more advanced search and metadata platform. It also vaguely hinted that the technology acquired would improve its current mobile search, which is rather limited. Macrovision also launched a new video search widget earlier this month.

Macrovision (now known as Macrovision Solutions Corporation) has been busy repositioning itself as an online media company since the beginning of 2007. In this time, it has shelled out $3bn on five deals for online content and the technology to deliver it. The company has also been selling off units unrelated to this online strategy. This year, it sold off its software business to Thoma Cressey Bravo for $200m, as well as its digital rights management assets for disk-related games from its Trymedia unit to RealNetworks for $4m (Macrovision paid $31m for the company three years ago).

Even though the online content provider has seen an increase of users and Wall Street is becoming less skeptical of the Gemstar combination, shareholders still need to be sold on the company’s current strategies. Through its acquisition of ThoughtWorthy’s metadata platform, Macrovision plans to create a video tagging service that will allow users to find and buy songs from within TV shows. Although small, the addition of this potential revenue stream to its current advertising-based business model could nonetheless bump up the standing of Macrovision on Wall Street.