Is it finally prime time for TiVo?

A decade after it changed the way we watch TV, TIVO may be embarking on a second act. What has changed for TiVo? Three things:

First, the company began suing others profiting from the technology it pioneered. In a software industry plagued by patent trolls that abuse intellectual property law, TiVo made the kind of case patents were meant to protect. It wanted its share of the innovations it created.

Second, as consumers tire of the primitive interfaces for navigating TV programming, demand is growing for the superior kind of interface TiVo offers. Nor is TiVo skimping on improving its offerings. In the past nine months, TiVo has spent $88.5 billion on research and development, equal to 41% of its total revenue in the period.

This gets at the third, and perhaps most interesting reason why investors are taking a new interest in TiVo. The company—with its court-tested patents, its industry-standard software and its $1.5 billion market cap—would make an attractive acquisition candidate for a tech giant looking for a compelling set-top box software, a company like Apple or Google.

Whether TiVo enters the brave new world of digital television as an independent entity or as a part of a bigger company, the outlook for the DVR pioneer is as bright as it's been in years.