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This writeup from Engadget sums up my feelings about a story in the New York Times:
Ok, now we understand why TiVo CEO Michael Ramsay was
promotedout of his job last week. You know how people have been telling TiVo how the only way they’re going to survive would be to convince some a cable company to license their digital video recorder software for use on set-top boxes? Yeah, well according to the New York Times last summer they were about to score a big deal with Comcast to do precisely this, that is until Ramsay pulled the plug at the last moment because he was convinced TiVo wasn’t getting paid enough money or given enough control over the service.
Remember how DirecTV accounts for 2,000,000 of TiVo's 3,000,000
customers and TiVo lost that relationship? TiVo was negotiating with
Comcast last summer and offered less than the $1/month that they get
from DirecTV, so Michael Ramsay decided to walk away.
Now it's easy to play Monday morning quarterback in situations like
this, but hasn't a big cable company deal been the dream all along?
And in spite of sub-dollar monthly fees, couldn't the Tahiti strategy be an alternate revenue source for those customers?
To be fair, if the Comcast deal had been inked and then TiVo was
prevented from introducing innovative products because of their threat
to the cable companies we'd all be screaming bloody murder. It's
possible (note that word, this is pure speculation) that there was a
non-negotiable clause that said something like "Non-Comcast video will
not be available on the TiVo" which would have nixed any of the future
plans like partnering with content providers.
When the story of TiVo is written, this Comcast negotiation could be the point when the company's outcome was decided.
by George Hotelling January 17, 2005 in TiVo
Wow, if this is true, it is rather upsetting. Once you walk away from an opportunity like that they generally are gone for good. Even if they would've gotten very little from the deal, it would've put 'TiVo' into many homes, and kept some *other* solution *out*. Which is perhaps more important.
TiVo has said they can survive without DirecTV because the overall financial benefit of the deal isn't really that large a part of their income, but it is still income and my understanding is it is still a profitable business. So it is upside.
Posted by: MegaZone at Jan 17, 2005 3:24:17 PM
Tivo fatally believed that its product was hard to deliver.
Posted by: pb at Jan 17, 2005 5:29:26 PM
Market penatration is always a good thing. TiVo has done an excellent job at penatrating minds with the DVR concept, but when people see other solutions available it lessens the overall value of the TiVo DVR brand while improving the value of TiVo concept.
Posted by: Dan at Jan 17, 2005 5:39:50 PM
Agreed they walked away from a deal. But Comcast probably gave the lowball offer in a attempt to work from the bottom up on price. Tivo not offering a counter offer was plain stupid. However the Comcast deal is not said and done. Comcast would likely buy Tivo once they're down and out.
FYI Tivo's directtv dominance is being eroded by a soon to be released PVR that does not include tivo tech.
Posted by: Corey at Jan 17, 2005 5:43:12 PM
Sorry, I do't understand the comment "the Comcast deal is not said and done." I already have a wonderful Comcast DVR already, why would Comcast throw it away and use Tivo instead?
Posted by: Thomas at Jan 17, 2005 6:06:18 PM
With the Comcast in-house development team increasing with the purchase of Liberate Technology assets, TIVO will have to beg to get back into Comcast good books again. They gave up a chance to be in 40 million homes in the US. Comcast now is in control of their own iTV platform, I say they don't need TIVO at all.
Posted by: Jack at Jan 17, 2005 6:11:59 PM
Looking at the other PVRs out there, especially Comcast's, they are the clunkiest pieces of junk out there. The Tivo interface is so much better looking. Tivo's features are better. Sorry, but you will never be able to pry my Tivo from my hands. Not even after I'm dead. The best possible solution? Comcast inks a deal with Tivo. Once you use Tivo, I think you will feel the same way I do.
Posted by: Will Maitner at Jan 17, 2005 6:57:26 PM
Thomas, I own a Tivo (have owned a few) AND a Comcast dual tuner DVR. Guess which I prefer to use, is easier to use, has more features, etc etc etc?
Tivo is lightyears (and many many development years) ahead of Comcast's stuff.
If I could junk the Comcast tomorrow, and get a Tivo branded PVR that directly decoded cable (ie the reason I use the Comcast - no cable box issues, dual tuners, etc), I'd do it in a heart beat. Tivo is the gold standard in my view. Nothing else is even second place right now.
Posted by: Seth at Jan 17, 2005 7:03:51 PM
Here is what i am worried about, I am a loyal directivo customer and well if tivo goes under what happens to all these units.....you think the people at tivo would be nice enough to activate a lifetime sub on the box before they drown....I dont think I could live without my tivo
Posted by: Atomis at Jan 17, 2005 7:26:13 PM
I could name a few other firms (Digital Equipment is a historical one, there are many current ones) where the founder should have stepped aside, because the 'parenthood' sentiment just destroys the judgment needed to do the right thing. Ramsay' TiVo was a great idea, but not doing the comcast deal was suicidal.
Posted by: Monday Evening QB at Jan 17, 2005 7:45:47 PM
Why does everyone assume Comcast was interested in Tivo in order to deploy Tivo boxes? Comcast is very wedded to its Motorola platform, and now with Liberate has its own PVR development well underway. Tivo is a totally different architecture and hardware/OS platform. Me thinks this was just Comcast looking to license some patents and ideas, not actual products.
Posted by: Friend at Jan 17, 2005 8:14:56 PM
Having a problem with my Comcast box. Certain show will not fast forward. This week's episode of 24 on Fox...no pause of ff
Posted by: Amb34 at Jan 17, 2005 8:33:48 PM
While TiVo has made many mistakes strategically (Thomas does a good job outlining them on his site), as much as it pains me to say, I dont think walking away from Comcast was one of them.
DirecTV's decision not to support HMO / TTG, etc. provides a good indication of what a Comcast relationship would have been like - restrictive, half-fast and ultimately detrimental to the TiVo brand.
Starting in 2006, the landscape is going to be reset - TiVo will be able to offer a single solution which supports native digital signal capture (via CableCard), dual tuners (at least), and HD.
TiVo will probably always be the higher-cost provider given the service providers deeper pockets, ability to bundle and better marketing / distribution economics, but TiVo should be able to get creative and discount based on the consumer signing a long-term deal, etc.
TiVo being forced to go direct might be best not only for the company, but the for the consumer.
TiVo is going to have to out innovate, and out-develop its competitors in the form of more functionality, etc. to compete.
Apple has manage to do this in the computer market, and its a > $25BN thriving company - which is only a failure when measured relative to Microsofts > $250 BN market cap.
Posted by: New York at Jan 17, 2005 8:56:10 PM
Personally, I've caused the placement of 4 tivos into others homes, severely influenced another 2. Only 1 of them was directv.
DirecTV WILL have HMO, the current R10 boxes have the screens, there are many posts on tivocommunity.
A co-worker just received a plasma hdtv, signed up for comcast HD, got their new HD box. He absolutely hates it, (the comcast box), he complains _every day_ it locks, up, doesn't record his shows, is hard to use. He sums it up as "it's not TIVO".
Another coworker received TIVO for xmas, just installed it this weekend. His biggest complaint was setup. If it wasn't from his daughter and a wireless modem jack investment, it would have gone back he said. He missed antenna vs cable in the setup and misunderstood he needed to wipe the box and start over.
After 1 day he was digging the pause, replay and rewind. Will see if he watched the news in 7 minutes tomorrow.
Less than a $1.00 a viewer, TIVO makes 12 times that now with individual boxes, I think their sales were higher than expected for the holidays. Tivo was number # 11 top selling merchandise on Amazon a couple of times.
TIVO needs to go on QVC once a month, they'd sell 10,000 units in an hour.
I believe their losses are the research on HD unit, the cable card unit, the development of the TIVOtoGO. The comparison to Apple is sound, how will TIVO be with 500,000 stand along subscribers at the end of this year? likely double next year. Every celebrity has a TIVO, Oprah gives them away, Ellen gives them away.
Stock is cheap tomorrow I bet.
Posted by: alan w at Jan 17, 2005 10:24:04 PM
Atomis - with regards to directivo's, I just called DirecTV support and spoke with a tech. He's gotten a ton of calls, and escalated up to his manager's manager, and no one inside of the direcTV tech support department knows anything about them cancelling support. He says they will always support it.
He also claimed to have a personal stake in it, because he loves his TiVo. :)
So, don't worry about DirecTiVos becoming obsolete -- you've probably got until at least the end of 2007 to continue using it, and by then you'll probably need to upgrade anyway in order to be in compliance with the government's latest 'anti-piracy' flag that they'll be adding to broadcast streams.
Posted by: opiate at Jan 17, 2005 10:50:37 PM
ComCast now came out with OnDemand, which is actually really neat, though the selection isn't great.
Yet another hard blow for TiVo.
-----------------------
More tech talk at http://loudboard.com/d/zid/80.htm
Posted by: Lexor at Jan 18, 2005 12:37:39 AM
The main problem for Tivo as a company is that they have never recognized that they are a software company, not a hardware company. They make zero revenue on hardware, and the value to us as Tivo/DirecTivo customers is the software and interface.
Tivo software should be running on most DVRs, DirecTVs, Comcasts, Time Warner's, HP's, etc....even NDS. The software business model is far more sustainable, and supports continued development of added software and services to gain additional revenue from installed hardware.
Too bad they have been so misdirected.....especially sad, as I am a long time Tivo customer and evangelist.
Posted by: bobca at Jan 18, 2005 4:56:22 AM
I thought Microsoft made a billion dollar investment in Comcast to get Microsoft code into Comcast cable boxes. Now I use a Comcast/Motorola 6412 cable box that has Microsoft software "inside". So maybe Microsoft is buying market share through the use of low ball license fees to beat TiVo?
Posted by: rene 'atlanta' at Jan 18, 2005 5:59:48 AM
"The main problem for Tivo as a company is that they have never recognized that they are a software company, not a hardware company."
Bob: TiVo has *always* seen itself as a software company, and was pulled into the hardware business kicking and screaming. If Philips hadn't bailed, I doubt we would have ever seen a TiVo-branded box anywhere outside a trade show.
Posted by: Roger Benningfield at Jan 18, 2005 6:16:53 AM
I have no doubt the Comcast deal *did* have all kinds of constraints against competition. You can bet that Tahiti was one thing that was prohibited. The cable providers are extremely jealous of their subscribers, and they protect them like nobody's business. Tahiti is a direct threat to their business model.
There aren't any simple answers to Tivo's problems. The fact of the matter is that cable providers are in the drivers seat when it comes to interactive TV, and they're very good at ensuring they remain so. As the NYT article notes, look at who has fallen by the wayside (Liberate, OpenTV). There is just no way a cable company is going to lose control of their business, or be beholden to a technology partner. If that means crappy service (and it does), or glacial innovation (and it does), so be it. They have no problem stonewalling and just watching ITV companies wither and die.
Posted by: Dave at Jan 18, 2005 7:23:10 AM
"Once you use Tivo, I think you will feel the same way I do."
The problem is, with low-cost and sufficing (if not ideal) DVRs available through other sources (e.g., Comcast), at a fraction of the price and at higher convenience, the number of folks who will actually *try* a TiVo will stay small.
That's the real cost of walking away from the Comcast deal.
Posted by: *** Dave at Jan 18, 2005 9:26:45 AM
Count me in as a 'lost sale' for TiVO. I got Comcast 6412 box and am quite happy with it.
What pulled me in:
- single box
- no need for phone wire
- dual tuner
- HD capabilities (don't have one now, but may be later..)
- no upfront cost and cheaper monthly fee
I haven't encountered any major problems yet.
What I don't like:
- remote is not very ergonomical
- interface is OK, but nothing to rave about.
Look, I'm sure TiVo is a better product (if you ignore dual tuner and HD) but 6412 box is good enough for me and has room to grow, one hopes. In the end, being able to watch as much TV as possible is not a worthy goal in itself.
You mileage can vary, of course.
Posted by: PG at Jan 18, 2005 3:27:08 PM
Motorola Acquires Ucentric Systems, Extending the Seamless Mobility of Digital Video Entertainment through the Home
HORSHAM, Pa. - 18 January 2005 — Motorola, Inc. (NYSE: MOT) today announced that the company has acquired privately-held Ucentric Systems, Inc., a leading provider of home media networking software for the connected home.
This strategic acquisition enables Motorola to actively market connected home software solutions to third party service providers and consumer electronics manufacturers. A leader in end-to-end broadband technologies, Motorola will leverage its global brand presence and worldwide resources to grow Ucentric's existing customer base.
The Ucentric software solution provides seamless access to stored digital entertainment - such as high-definition video on a DVR, music on a computer hard drive, or pictures on a laptop - from any connected device in the home. The software is designed to operate with electronic program guides from multiple vendors, and service providers can customize the interface with applications that personalize the subscriber experience.
Additionally, Motorola will make the software available as part of its Home Media Architecture solution for the company's advanced and basic digital set-top platforms.
"Motorola is committed to bringing relevant seamless mobility solutions to the connected home marketplace, and the acquisition of Ucentric's suite provides us with a robust software platform for delivering the next generation of broadband services. Customers can leverage these new tools in our portfolio to deliver new levels of personalized entertainment and communication to devices in and around the home," said John Burke, Motorola corporate vice president and general manager, consumer entertainment solutions.
==============
Ucentric announced a licensing agreement with DIRECTV, Inc. at CES 2005, the nation's leading and fastest growing digital television service provider, to deploy its Home Media Center software platform. The new DIRECTV Home Media Center will be comprised of a main unit, with smaller units located at each additional TV networked throughout the house, to provide DIRECTV customers with digital video recorder (DVR) service on all television sets.
Posted by: New York at Jan 18, 2005 5:18:44 PM
I don't know which is sadder, the fact that TiVo missed the boat here or that Comcast is such a gorilla, a simple deal gone bad can potentially break a company.
You could say that Comcast doesn't need TiVo... No one chooses their television service based on the beauty of interface design or how they access their programs. However, moving forward, it's all about keeping up with and/or copying the things that TiVo has introduced to make watching TV that much more of a pleasure. Combined with the fact that as a traditional cable company, Comcast, and others, are behind the eight ball in how they develop and deploy new technology, compared to a traditional consumer electronics company. So in that regard, they do need TiVo... and I guess it's just a matter of time until they take that over as well.
Posted by: sally at Jan 18, 2005 5:21:02 PM
As a tivo user since its release to the market, I have to say that they have the best PVR software by far. However their not doing anything that couldnt be done by anyone one else. Result: Tivo either needs to step up and make a deal or pretty soon im going to be without service.
Posted by: Steven at Jan 19, 2005 7:06:48 AM
None of us know ANYTHING about the terms of this so-called Comcast deal.
Perhaps Comcast wouldn't deal unless they get hold of all of TiVo's IP?
Where is the proof of this 1$ a month figure that was offered? Maybe it was closer to 10c. Or maybe it was a one-time fee.
All of us act like we know so much and could have done a better job. But we have no clue what the truth is.
I think this NYT article is full of it.
Posted by: Johanes at Jan 19, 2005 1:36:01 PM
I bought a ReplayTV 3 years ago and dearly love it, as does my wife. Not quite a TiVo like I recommended to my brother-in-law, but it was cheap at the time and we love the auto-commercial skip.
But, when our old TV finally went belly up we bought a Phillips CRT HDTV at CostCo, thinking we need to be ready for the future.
Then, of course, to get value out of it we ordered HD service with the DVR from Comcast, figuring to pay Comcast the $9.95/month we were paying ReplayTV -- a wash. Of course the HD service was $5, and... to get ESPN HD and TNT HD we needed to upgrade to digital cable as well. So my cable bill goes up $30/month and my Replay bill goes down $10.
The DVR is Scientific Atlanta 8300 HD, and it amazes me how inferior the interface is compared to a 3-year old box from the second best DVR company. My wife begged for her ReplayTV back, and even started watching tennis in the back room on my crappy 19" set, which has the ReplayTV for the moment.
That is, until we watched the US Open Tennis final on the comcast DVR in 16:9 HD. Beautiful, we just had to do a lot of (rather slow) fast forwarding.
If and when TiVo comes out with the dual tuner HD cablecard machine discussed here, and if it can replace what comcast gave me I will seriously consider it -- but I doubt the new users of the comcast box will, because if the SA 8300 HD is all you have ever seen it will probably seem good enough.
Posted by: Richard-in-Florida at Sep 12, 2005 1:09:55 PM
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