This Quarterly Report on Form 10-Q contains forward-looking statements that involve risks and uncertainties, as well as assumptions that, if they never materialize or prove incorrect, could cause the results of OpenTV Corp. and its consolidated subsidiaries to differ materially from those expressed or implied by such forward-looking statements. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including any projections of revenue, expenses, earnings or losses from operations; any statements of the plans, strategies and objectives of management for future operations; any statements concerning developments, performance or market conditions relating to products or services; any statements regarding future economic conditions or performance; any statements of expectation or belief; and any statements of assumptions underlying any of the foregoing. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this Quarterly Report on Form 10-Q. These forward-looking statements are based on information available to us at this time, and we assume no obligation to update any of these statements. Actual results could differ materially from those projected in these forward-looking statements as a result of many factors, including those identified in the section titled "Risk Factors" contained in Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2007, as such section may be updated

in our subsequent Quarterly Reports on Form 10-Q and elsewhere. We urge you to review and consider the various disclosures made by us from time to time in our filings with the Securities and Exchange Commission that attempt to advise you of the risks and factors that may affect our future results.

The following discussion should be read together with the unaudited condensed consolidated financial statements and the notes thereto included elsewhere in this Quarterly Report on Form 10-Q and with our audited financial statements, the notes thereto and the section titled "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2007, as filed with the Securities and Exchange Commission.

Overview of Our Business

We are one of the world's leading providers of software solutions for the delivery of digital and interactive television. Our software enables cable, satellite, telecommunications and digital terrestrial operators, which we refer to as network operators, to offer enhanced television experiences to their viewers.

The majority of our revenue typically comes from one-time royalty fees paid by network operators or manufacturers of set-top boxes, once a set-top box, which incorporates our software, has been shipped to, or activated by, the network operator. We also derive revenue from the licensing of related software and interactive content and applications associated with the delivery of digital and interactive television, as well as from licensing products that enable advanced advertising solutions. In addition, we receive professional services fees from consulting, systems integration and training engagements, fees for the maintenance and support of our products and fees from revenue sharing arrangements related to the use of our interactive content and applications.

Our revenue model may change over time. For example, we have signed subscription-based licensing agreements under which we receive monthly payments for each set-top box that includes our software that our customers deploy, for so long as those set-top boxes remain active. In addition, our technology and services are provided indirectly through distribution arrangements with key partners other than network operators and set-top box manufacturers, such as conditional access vendors, and we expect revenues generated from such distribution arrangements to increase over time.

Kudelski SA, directly and indirectly through its subsidiaries, beneficially owns Class A and Class B ordinary shares of our company collectively representing an economic interest of approximately 32.0% and a voting interest of approximately 77.0% in our company, based on the number of our ordinary shares outstanding as of September 30, 2008.

Recent Events

In September 2008, we acquired the entire share capital of Ruzz TV Pty Ltd., a private company based in Sydney, Australia, which provides digital television technologies that enable broadcasters to manage their workflow and content processes more efficiently. The purchase price consisted of an upfront cash payment of $0.2 million plus contingent consideration of up to $0.1 million that is subject to Ruzz's achievement of a specified revenue target for 2009 and a profit sharing arrangement to the extent Ruzz generates any profits through 2011.

Critical Accounting Policies and Estimates

Our discussion and analysis of our financial condition and results of operations are based upon our interim financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States, which we refer to as GAAP, as applicable to financial statements for interim reporting periods. The preparation of these interim financial statements requires us to make estimates and judgments that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. In preparing these interim

financial statements, we made our best estimates and judgments, which are normally based on knowledge and experience with regard to past and current events and assumptions about future events, giving due consideration to materiality. Actual results could differ materially from these estimates under different assumptions or conditions.

We believe the following critical accounting policies and estimates have the greatest potential impact on our interim financial statements: revenue recognition, allowances for doubtful accounts, tax valuation allowances, deferred tax assets, impairment of goodwill and long-lived assets, restructuring costs and share-based compensation. All of these accounting policies and estimates, together with their underlying assumptions and their impact on our financial statements, have been discussed with the audit committee of our board of directors.

As discussed below and in Note 13 to the interim financial statements, we adopted Statement of Financial Accounting Standards (SFAS) No. 157, "Fair Value Measures" (SFAS 157), as of January 1, 2008, with the exception of the application of the statement to nonrecurring nonfinancial assets and nonfinancial liabilities, the deferral of which was permitted under Financial Accounting Standards Board (FASB) Staff Position No. FAS 157-2, "Effective Date of FASB Statement No. 157" (FSP 157-2).

We adopted SFAS No. 159, "The Fair Value Option for Financial Assets and Financial Liabilities - Including an Amendment of FASB Statement No. 115" (SFAS 159), as of January 1, 2008 and elected not to measure any additional financial instruments or other items at fair value.

Other than the above changes, there have been no significant changes in our critical accounting policies and estimates during the three and nine months ended September 30, 2008 as compared to the critical accounting policies and estimates disclosed in the section entitled "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in our Annual Report on Form 10-K for the year ended December 31, 2007.

Fair Value Measurement

In September 2006, the FASB issued SFAS 157. SFAS 157 provides guidance for using fair value to measure assets and liabilities and applies whenever other standards require or permit assets or liabilities to be measured at fair value but does not expand the use of fair value in any new circumstances. SFAS 157 is effective for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years.

In February 2008, the FASB issued FSP 157-2. FSP 157-2 defers the effective date of SFAS 157 for nonfinancial assets and nonfinancial liabilities, except those that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually), to fiscal years, and interim periods within those fiscal years, beginning after November 15, 2008.

We adopted SFAS 157 as of January 1, 2008, with the exception of the application of the statement to non-recurring nonfinancial assets and nonfinancial liabilities. Substantially all of our financial assets and liabilities are measured at fair value using Level 2 inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument.

In February 2007, the FASB issued SFAS 159. SFAS 159 provides the option to report certain financial assets and liabilities at fair value, with the intent to mitigate volatility in financial reporting that can occur when related assets and liabilities are recorded on different bases. Unrealized gains and losses on items for which the fair value option is elected would be reported in earnings. SFAS 159 is effective for fiscal years beginning after November 15, 2007. We adopted SFAS 159 as of January 1, 2008. We currently do not have any additional financial instruments or other items that are eligible for election of the fair value option. Therefore, the adoption of SFAS 159 did not have a significant impact on our interim financial statements.

Recent Accounting Pronouncements

In June 2008, the FASB issued FASB Staff Position Emerging Issues Task Force (EITF) 03-6-1, "Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities" (FSP EITF 03-6-1). FSP EITF 03-6-1 provides that unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and shall be included in the computation of earnings per share pursuant to the two-class method. FSP EITF 03-6-1 is effective for financial statements issued for fiscal years beginning after December 15, 2008 and interim periods within those years. Upon adoption, a company is required to retrospectively adjust its earnings per share data (including any amounts related to interim periods, summaries of earnings and selected financial data) to conform with the provisions in FSP EITF 03-6-1. Early application of FSP EITF 03-6-1 is prohibited. We do not expect FSP EITF 03-6-1 to have a material impact on our financial statements.

In April 2008, the FASB issued FSP FAS 142-3, "Determination of the Useful Life of Intangible Assets" (FSP FAS 142-3). FSP FAS 142-3 amends the factors that should be considered in developing renewal or extension assumptions used to determine the useful life of a recognized intangible asset under SFAS No. 142, "Goodwill and Other Intangible Assets" (SFAS 142). The intent of FSP FAS 142-3 is to improve the consistency between the useful life of a recognized intangible asset under SFAS 142 and the period of expected cash flows used to measure the fair value of the asset under SFAS No. 141 (Revised 2007), "Business Combinations" (SFAS 141(R)) and other GAAP. FSP FAS 142-3 is effective for financial statements issued for fiscal years beginning after December 15, 2008 and interim periods within those fiscal years. Early adoption is prohibited. We continue to evaluate the impact of the adoption of FSP FAS 142-3 on our financial statements.

In December 2007, the FASB issued SFAS 141(R). Under SFAS 141(R), an acquiring entity will be required to recognize all of the assets acquired and liabilities assumed in a transaction at the acquisition-date fair value with limited exceptions. SFAS 141(R) will significantly change the accounting for business combinations. SFAS 141(R) also includes a substantial number of new disclosure requirements. SFAS 141(R) applies prospectively to business combinations for which the acquisition date is on or after commencement of the first annual reporting period beginning on or after December 15, 2008. Early adoption is prohibited. We continue to evaluate the impact of the adoption of SFAS 141(R) on our financial statements.

In December 2007, the EITF issued Issue No. 07-1, "Accounting for Collaborative Arrangements" (EITF 07-1). EITF 07-1 is effective for financial statements issued for fiscal years beginning after December 15, 2008 and interim periods within those fiscal years, and shall be applied retrospectively to all prior periods presented for all collaborative arrangements existing as of the effective date. EITF 07-1 requires that transactions with other parties in connection with qualifying collaborative arrangements (i.e., revenue generated and costs incurred by such parties) be reported in the appropriate line item in each company's financial statements pursuant to the guidance in EITF Issue No. 99-19, "Reporting Revenue Gross as a Principal versus Net as an Agent" (EITF 99-19). EITF 07-1 also includes enhanced disclosure requirements regarding the nature and purpose of the arrangement, rights and obligations under the arrangement, applicable accounting policies, amounts involved and income statement classification of transactions between the parties. We continue to evaluate the impact of the adoption of EITF 07-1 on our financial statements.

Results of Operations for the Three and Nine Months Ended September 30, 2008 and 2007

Revenues

We have entered into commercial arrangements involving both product licenses and service elements that are bundled together. Revenues from such bundled offerings under GAAP have been allocated to the "Royalties and licenses" and "Services and other" revenue line items based on the relative fair values of the product and service elements in each of the contracts. Our determination of the relative fair values of these elements is based on the relative amounts of the fees we charge our customers for the product licenses and service elements, as set forth in each of the applicable contracts.

Revenues for the three months ended September 30, 2008 were $26.9 million, an increase of $3.2 million, or 14%, from $23.7 million for the same period in 2007. Revenues for the nine months ended September 30, 2008 were $87.5 million, an increase of $15.8 million, or 22%, from $71.7 million for the same period in 2007.

Revenues by line item were as follows (in millions, except percentages):

                                           Three Months Ended                                  Nine Months Ended
                                             September 30,                Change                 September 30,             Change
                                           2008          2007        2008 versus 2007           2008        2007      2008 versus 2007
                                                                        $            %                                    $          %
Royalties and licenses                  $     16.5    $     16.2   $       0.3         2 %   $     56.9    $  48.1   $       8.8      18 %
Services and other                            10.4           7.5           2.9        39 %         30.6       23.6           7.0      30 %

Total revenues                          $     26.9    $     23.7   $       3.2        14 %   $     87.5    $  71.7   $      15.8      22 %

Royalties and licenses

We generally derive royalties from the sale of set-top boxes and other products that incorporate our software. Royalties are typically paid by either the network operator or the set-top box manufacturer depending upon our payment arrangements with those customers, and we have historically recognized revenues through one-time royalty payments or ongoing license fees. We recognize royalties upon receipt of royalty reports reflecting unit shipments or activation of our software by network operators or manufacturers. Royalty reports are generally received one quarter in arrears. For non-refundable prepaid royalties, we recognize revenues upon initial delivery of the software to our customers. We also license our technology and services indirectly through distribution arrangements with key partners other than network operators and set-top box manufacturers, such as conditional access vendors, who pay the applicable license and royalty fees directly to us in lieu of the network operator or set-top box manufacturer. We have also entered into license agreements with network operators who pay us under a subscription-based model, pursuant to which we are paid a monthly fee for each set-top box that is shipped or deployed commercially by the network operator for so long as that box remains in use by the network operator.

The aggregate amount of royalties we receive from our customers during a quarterly period is influenced by a number of factors. In the case of our set-top box software, these include: initial deployments by new customers, the activation of new subscribers by existing customers, the shipment of additional set-top boxes as replacements for older or defective set-top boxes or for purposes of simply upgrading existing set-top boxes, and sales of new products or services by the network operators that require new or updated set-top boxes. We have historically provided various types of prospective volume discounts on optional future deployments of our licensed middleware products based on the volume of the customer's previous deployments of the particular licensed products, and expect that we will continue to do so in the future. Unless we are able to offset anticipated discounts through a change in product mix, upgrades to our software or other methods which enable us to charge higher fees, we may experience slower royalty growth as discounting is triggered.

A significant portion of our revenues is dependent upon our customers' subscriber base, the growth in their subscriber base, and the related quantities of set-top boxes deployed with our software. Specific royalty trends associated with set-top box deployments by our customers are difficult to discern in many cases as we do not control or directly influence actual deployment schedules of our customers. However, our general experience in the past suggests that set-top box deployments by our customers tend to be stronger in the third and fourth quarters of the calendar year. Because we receive most of our royalty reports one quarter in arrears, our royalty revenues in the past have generally been higher in the first and fourth quarters of the calendar year, though our revenues in the fourth quarter of 2008 and first quarter of 2009 may be negatively impacted if our customers reduce deployments of our products due to the recent deterioration in worldwide economic conditions.

We also derive fees from the licensing of other software products, such as OpenTV Streamer, OpenTV Eclipse, including our next generation campaign management solution known as EclipsePlus, and OpenTV Participate. These license fees can be in the form of one-time, upfront payments by our customers, the total of which can vary significantly from quarter to quarter, or can be in the form of a recurring license fee, the total of which is less likely to vary significantly from quarter to quarter.

Royalties and licenses revenues by region were as follows (in millions, except percentages):

                                          Three Months Ended                                    Nine Months Ended
                                             September 30,                 Change                 September 30,                 Change
                                          2008           2007         2008 versus 2007          2008           2007        2008 versus 2007
                                                                         $            %                                       $            %
Europe, Middle East and Africa          $     8.5       $   8.4     $       0.1        1 %    $    27.9       $ 23.8     $       4.1        17 %
Americas                                      4.6           4.3             0.3        7 %         14.8         14.2             0.6         4 %
Asia Pacific                                  3.4           3.5            (0.1 )     (3 %)        14.2         10.1             4.1        41 %

Total royalties and licenses revenues   $    16.5       $  16.2     $       0.3        2 %    $    56.9       $ 48.1     $       8.8        18 %

As percentage of total revenues                61 %          68 %                                    65 %         67 %

Three Months ended September 30, 2008 versus Three Months ended September 30, 2007. Royalties and licenses revenues for the three months ended September 30, 2008 increased $0.3 million, or 2%, to $16.5 million.

• Europe, Middle East and Africa accounted for $8.5 million in royalties and licenses revenues for the three months ended September 30, 2008, an increase of $0.1 million, or 1%, compared to the same period in 2007.

British Sky Broadcasting, or BSkyB, directly and indirectly through our set-top box manufacturer customers who sell set-top boxes to BSkyB, accounted for $3.6 million, or 22%, of our total worldwide royalties and licenses revenues for the three months ended September 30, 2008. BSkyB royalties and licenses revenues decreased by $1.1 million compared to the same period in 2007, primarily as a result of decreased deployments by BSkyB of our software products. The decrease in BSkyB revenues was offset by an increase of $0.8 million in royalties and licenses revenues from Sky Italia as compared to the same period in 2007, primarily due to increased deployments of set-top boxes containing our middleware products, and by $0.5 million of royalties and licenses revenues resulting from the initial deployment of set-top boxes containing our middleware by Numericable in France. Royalties and licenses revenues from other customers decreased by $0.1 million due to lower volumes of set-top box deployments by such customers.

• The Americas region accounted for $4.6 million in royalties and licenses revenues for the three months ended September 30, 2008, an increase of $0.3 million, or 7%, as compared to the same period in 2007.

EchoStar, including DISH Network and EchoStar Technologies LLC, accounted for $1.2 million, or 7%, of our total worldwide royalties and licenses revenues for the three months ended September 30, 2008. EchoStar royalties and licenses revenues declined $0.6 million as compared to the same period in 2007, primarily due to reduced set-top box deployments by this customer. This reduction in royalties and licenses revenues was partially offset by increased royalties and licenses revenues from NET in Brazil of $0.4 million, as compared to the same period in 2007, reflecting increased deployments of middleware-related products by this customer. Royalties and licenses revenues from other customers in the region accounted for a net increase of $0.5 million as compared to the same period in 2007 due to higher volumes of deployments of our products.

• The Asia Pacific region accounted for $3.4 million in royalties and licenses revenues for the three months ended September 30, 2008, a decrease of $0.1 million, or 3%, as compared to the same period in 2007.

Royalties and licenses revenues from our largest customers in the region remained consistent with the same period in 2007. The net decrease of $0.1 million was due to lower volumes of deployments of our products by some of our smaller customers.

Nine Months ended September 30, 2008 versus Nine Months ended September 30, 2007. Royalties and licenses revenues for the nine months ended September 30, 2008 increased $8.8 million, or 18%, to $56.9 million.

• Europe, Middle East and Africa accounted for $27.9 million in royalties and licenses revenues for the nine months ended September 30, 2008, an increase of $4.1 million, or 17%, compared to the same period in 2007.

BSkyB, directly and indirectly through our set-top box manufacturer customers who sell set-top boxes to BSkyB, accounted for $13.3 million, or 23%, of our total worldwide royalties and licenses revenues for the nine months ended September 30, 2008. BSkyB royalties and licenses revenues increased by $0.9 million compared to the same period in 2007, primarily as a result of increased deployments by BSkyB of our software products, particularly our PVR software. We typically generate higher royalty rates from set-top boxes that include our PVR software, such as the set-top boxes shipped to BSkyB, and we generally expect the number of PVR shipments to increase over time as network operators around the world seek to deploy more PVR functionality in the future. Royalties and licenses revenues from UPC Broadband Holdings, or UGC, increased $2.2 million as compared to the same period in 2007, as we achieved final delivery of all licensed products during the fourth quarter of 2007, which allows us to recognize the royalties and licenses revenues from UGC as they are reported. Royalties and licenses revenues from Multichoice Africa increased $1.1 million as compared to the same period in 2007, primarily due to a recent upgrade by this customer to our latest OpenTV Core2 middleware product and increased deployments of set-top boxes containing this product. These increases were partially offset by a decrease in royalties and licenses revenues from other customers of $0.1 million, resulting from lower volumes of set-top box deployments by such customers.

• The Americas region accounted for $14.8 million in royalties and licenses revenues for the nine months ended September 30, 2008, an increase of $0.6 million, or 4%, as compared to the same period in 2007.

EchoStar, including DISH Network and EchoStar Technologies LLC, accounted for $4.3 million, or 8%, of our total worldwide royalties and licenses revenues for the nine months ended September 30, 2008. EchoStar royalties and licenses revenues declined $2.0 million as compared to the same period in 2007, primarily due to reduced set-top box deployments by this customer. Royalties and licenses revenues from Bell TV (formerly Bell ExpressVu) in Canada declined $0.6 million as compared to the same period in 2007. This decrease was primarily due to an amendment to our license agreement with Bell TV entered into during the first quarter of 2007 that converted the pricing model from an upfront royalty to a recurring subscription fee per set-top box, payable over the term of the customer's use of the set-top box incorporating our middleware. We expect the cumulative per set-top box subscription fees paid by Bell TV over the expected period of use of the set-top box to more than compensate for the relative difference between the amount of the prior upfront royalty and the recurring subscription fee. These reductions in royalties and licenses revenues were partially offset by increased royalties and licenses revenues from NET in Brazil of $1.8 million, as compared to the same period in 2007, reflecting increased deployments of middleware-related products by this customer, and an increase of . . .