TiVo CEO Tom Rogers commented on the conference call:
When it comes to our mass distribution business, we have unshackled our growth by eliminating the need for dedicated hardware. With Comcast and other cable operators we are looking to sign up, we are a software upgrade that transforms the generic DVR into TiVo.
Because of that, we are actually very excited by the number of generic DVRs the cable industry is looking to roll out, because each of those boxes, as additional cable deals are done, becomes a potential TiVo home with both a subscriber and advertising revenue elements. This creates a powerful business model, beyond the one that exists for our standalone retail business.
Just like HBO cheered on basic cable connections as the key to opening up more homes for their premium service, we, too, view the increase in the number of households taking generic DVRs as a significant new opportunity for us.
More skeptical angles on the challenges TiVo faces in the DVR market were recently articulated by Seeking Alpha contributor Andrew Schmitt and in Barron's. There's also a very good writeup on TiVo in Wikipedia, which includes this on the topic addressed by Rogers:
TiVo's market share has dropped as cable television operators have offered free or low-cost DVRs which are widely seen as inferior (at least by TiVo users), but which are still a huge improvement over plain old TV and are "good enough." They are often touted as having no up-front equipment costs and a lower subscription fee as well as seamless compatibility with the cable television system.
TIVO 1-yr chart: