Whither Tivo?

I recently received a call from an executive recruiter who was handling the Tivo CEO search.

I didn't return the call because I am not interested the job and frankly I don't know anyone who is.

But it got me thinking about what I'd do if I had to do that job.

OM Malik has a post up on what he thinks Tivo needs to do.  He thinks Tivo needs to emulate Apple by retrenching and focusing on serving the needs of the Tivo enthusiasts, called the Tivoted.

I think some of OM's ideas are correct, but if I took the job, I'd do pretty much what Mike Ramsay, Tivo's founder, has been saying he wants to do. 

I'd walk away from the cable and satellite operators who only want to commoditize Tivo and focus on building a low end version of a Media PC that allows people to bypass the cable and satellite operators and get their entertainment directly from the Internet. I'd build it on Linux and low cost hardware and use the Tivo brand to generate demand for the product.

I'd also get into the content aggregation business ala Akimbo and others to provide programming on this device.

As Steve Jobs has said, selling to the cable and satellite operatos is a no-win proposition.  So Tivo has to walk away from that business and find a new one they can serve.

That's what I'd do if I took the job.

Comments

[W.B. McNamara]

> [...] and focus on building a low end version of a Media PC that
> allows people to bypass the cable and satellite operators and get
> their entertainment directly from the Internet.

This seems like a pretty tall order, no? Either you're dealing with existing TV content distributed via the Internet, which comes with a variety of big hurdles to overcome, or you're dealing with Internet-only content, which isn't what people expect to be limited to when buying a DVR.

I've been intrigued by Tivo's release of an SDK, though I see the logic behind the "too little, too late" opinions that I've seen of the move. What did you think of this "opening" approach, which allows tivo to pull content from the internet, among other things? Does the lack of the "content aggregator" end of your idea weaken it too much?

[Tivo Devotee]

Please. I could save Tivo in 10 minutes. Here is clue: advertise and brand it! It is an amazing product and the vast majority of people still do not understand what it does. You do not have to hire Joe Montana. If could be a simple as a black screen and an actor simply showing the features. Hey, audience, look at all this does:

1) You set it once to record Nip/Tuck whenever it is on just by looking up Nip/Tuck and selecting season pass.

2) You can pause live TV to get a snack or answer the phone

3) Like Deniro? You can set it to record all Deniro movies

Good lord - I could write that commercial in 10 minutes. Cmmon sense could have saved that company years ago.

[Matt Livingstone]

Any PVR device that tries to link the purchase of their device to a monthly subscription service is IMHO wasting their time.

Most consumers have the content( cable, satellite) they just want the ability to record it without having to PAY another service charge to basically view the same content they've already purchased off-air. Can you image selling VCRs the same way. Absolutely not.

Give me a PVR that I can add disk space to and administrate using either my TV screen or even better using my home network and a browser to setup my PVR and manage my content and schedule my recording times.

Simple to use. User customizable. NO MONTHLY FEES!

[Kevin]

I am VERY happy to pay my cable company (Comcast) a few dollars every month to rent their DVR (SA 8000HD) rather than buy a Tivo and then pay EVEN MORE for lifetime sub or month at a time. A year from now, I can simply give back the SA 8000HD box and get whatever new box is available at that time. How many current Tivo owners will be just as thrilled with their current system a year down the road?

[Chevsky]

I agree with Matt in many ways, but I think the Tivo brand is huge. They really need to leverage that name in doing something as simple as a straight forward PVR, perhaps with subscription and other fees coming via some sort of pay per view or on demand service. This is such an easy model that it amazes me how slow to react the studios/publishers are. Lastly, in leveraging their brand, I find it appalling as a shareholder that they are only in the U.S. market. As a Canadian, I could sign 50 people to this service within 10 minutes. Get people on your service, give away the guide for free, then open it up to low cost on demand services - that's all everyone wants. After all, the importance of Tivo is not for it to record every Nip/Tuck, it's being able to tune in at 1:07am and watch this week's episode - when ever the h*ll I want.

[Kamil]

I just purchased a TIVO. The only reason I got it was there new SDK that lets me write programs for it.

I think TIVO will be better served by opening up more of the TIVO functionality (through API) as well as making it no monthly fee but supported by ads (kind of like what they are going to do with the commercial skip).

Also I went to Wal-Mart and they didn’t sell TIVO there. WHAT? The people that shop at Wal-Mart are the people that watch the most TV as well as spend the most on TV.

To recap: TIVO will be saved if they make their platform more open (ala extended API) as well as getting revenue from commercials/on demand programming/downloadable music/downloadable movies/etc.. and not through a measly $13 fee from their customers.

And ummm...I'll be CEO.

[Kerhop]

I agree the TiVo brand itself it strong, so if they don't survive as a stand-alone company is it likely someone like Comcast or DirecTV would buy TiVo outright so it becomes a subsidiary instead?

[Alex Rowland]

I agree with Fred's general direction, although not exactly how he wants to get there. The current TiVo device is set up to do everything that a Media Center does, and does TV better than most media centers out there. The main thing that TiVo doesn’t yet do (but is about to) is download IP video content (and audio although this is less relevant to establishing strategic advantage). This is a service that will make or break TiVo. As I expressed in my comments to Om Malik, this is the service that TiVo must provide quickly in order to prosper. There are some pros and cons to this approach...

1) IP content currently sucks (at least video). This is a major problem with providing IP service only and jettisoning the cab/sat content, the IP stuff just isn’t that compelling... yet. We’re still talking a 3-5 year maturation cycle (at least) until IP content as a whole will come even close to rivaling TV content. (There will be some IP stuff that comes along sooner that is better than anything on TV, but taken as a whole, it will be a few years yet.) TiVo must still support cab/sat until this equation changes; there is just too big a hole to fall into between here and the IP content nirvana of tomorrow.

2) TiVo must support both IP video and cab/sat, which will be a messy process. It is critical that TiVo push the cableCARD device out the door as quickly as possible. (I thought that serial connections would solve this problem, but they don’t seem to be taking off the way they should have, so cableCARD, with all its faults, will have to be it.) If cab/sat don’t like TiVo now, they’re going to hate them when TiVo opens up the Internet to their users. TiVo should expect a lot of hassles in the future, but nothing insurmountable.

3) TiVo must continue towards an open source approach to product maturation. This is also scary because it will severely loosen TiVos control over their platform, but it is critical to their ability to keep pace with the market. The SDK was a good start, but it needs to be taken further. Opening up the device to any appropriately formatted video content (read DRM MPEG-2) will put TiVo in a position that Moto and SA and the rest of the crew will be afraid to go for some time. Again, it pisses off the cab/sat guys who Moto and SA need to pay the bills. I just think that other people need to create the content aggregation points, not TiVo:)

Bottom line, Fred, TiVo does need to move quickly to position IP content as their primary source of revenue without losing their current value proposition, which is all focused on TV.

Aside: I think Matt even has a point when he says that TiVo should essentially hide the monthly subscription fee for the guide in other services and provide an online interface (I know a bit about this:). TMS (the guide) data is actually not that expensive per subscriber. The problem is, TiVo has to lose money on the hardware (to keep the up-front costs down) and is forced to try to make it up over time with the monthly. Unfortunately, consumers aren’t stupid and they begin to resent the monthly, as they are doing now.

TiVo needs to provide access to a suite of IP content and throw in access to some of this content for free as part of the monthly service charge. It doesn’t cost TiVo much to do this, and it will instantly differentiate TiVo from all the other DVR guys for some time. You pay $100 up-front + $13 monthly for a device that allows you to access stuff you can’t get through cable/satellite. People do it for other content services, (Netflix, satellite radio, satellite TV, et al.) there is no reason they won’t do it through TiVo.

[Whorf]

Same here. The monthly fees are why instead of triplet or quartet of the devices in my house, there are none. I've been reading up on MythTV, and since this is a Debian household, MythTV will be the pvrs in this house within the month. I had planned on waiting for SATA drives to hit a lower price point, as well as stalling as long as possible in the hopes of assembling a computer with the faster PCI (PCI Express iirc), and other faster parts (dual-core AMD, DDR2, etc.), but the impending deadline of the broadcast flag has changed those plans. I'm going to pick up some pvr-250s and the air2pc/hd3000 cards as soon as i find a reliable distributor rather than wait a few more months and then discover they are sold out and there is a backlog on orders all the way past the deadline in July.

Tivo may be a device of the gods, but with Congress in the pockets of the entertainment cartel they don't have a chance. Enjoy those lifetime subscriptions while you can, because Tivo will be dead by the end of the year. From what i've seen of time-warner's tactics with their cable monopoly, Tivo is dead in the water. TW is distributing set-top boxes with the firewire port disabled. Only upon request will TW "order one" for a customer with the firewire port enabled so it can be controlled by Tivo. Otherwise, they are relying on inertia and non-technical customers who are the vast majority of their customer base to upsell their own pvrs which put them in total control and freezes out tivo.

The real worry is what happens when tivo is gone? What will be the justification for demanding a set-top box with a firewire port that works, when they own the market, and MythTV/cable customers may number maybe 1 in 10,000 or 1 in 100,000 or less?

Good luck. To us all. An incompetent, senile former senator, Hollings, succeeded in driving a stake through the heart of fair-use with his beloved broadcast flag.

[RAT]

Whorf you obviously don't have a TiVo. There is no firewire port on the Tivo, there are however USB and serial ports and the serial (or an IR Blaster) ports can be used to change channels on an external box (like a digital cable or satellite box for example.)

Also, the broadcast flag is a bit of a red herring here, analog content doesn't use it which means that ALL TiVo's right now (with the exception of the HDTV Satellite TiVo) do not use the broadcast flag. I suppose a software update could allow it's use but I'm not quite sure if the flag will even nr included in analog broadcasts.

There is zero chance that TiVo will die and leave behind useless boxes. Keep in mind that the TiVo operating system uses a Linux Kernel, if they were to go out of business there is a large community of programmers and hackers (I use hackers in the traditional positive sense, not to be confused with Crackers or people who commit crime using a computer) out there that will be able to make the boxes work with alternative guide services, software updates, etc. Finally, even were TiVo to die wouldn't you want to pick up their assets on the cheap just so you could use their killer brand identity? This is what happened to Napster which still exists but as a paid online commercial music service/store post their closure by the big time record companies. The millions of existing TiVo owners are great insurance that the box will never become a boat anchor.

My problems with TiVo (and as is obvious I'm a long time subscriber and fan) is in a few places that they CAN do something about-

-The technology of TiVo is getting long in the tooth. I wish they would refresh it in a meaningful way. I'm not talking about more bells and whistles but basic stuff like better organization of recorded content, a faster processor chip so the box does not operate so slowly, etc.

-Record in HDTV from On-air, Cable or Satellite Sources with one multipurpose box. This box should also have all of the expected high end outputs/inputs as well (HDMI, DVI, Composite, Component, etc.)

-Include gigabit ethernet and wireless built right in the TiVo box. No silly after market add-on's which just confuse the heck out of your average non-Network Engineer customers. This could bring in your content from broadband connections (like Netflix movie rentals, clips from ESPN, etc.)

Imagine this box eh? It's never going to be Joe Sixpack's PVR but it could build a comfortable customer base as the best PVR on the market.

[Mattydread]

If I were CEO, I'd approach Microsoft's digital media group and beg to be acquired. Microsoft gets an explicable brand, some devoted customers, a guide that kicks ass over the ones used in Media Center PCs. TiVo's shareholders get stock in a company that won't be bankrupt. THe CEO walks away a rich man. End of story.

[RocketSauce]

I've had Tivo for 3 years, which is longer than any individual computer I've had. This statement screams that what puts Tivo ahead of it's competition is the softward. Not the hardware. I'm hopeful that PBS's I, Cringley is right in one of his yearly predictions that Tivo sells out to Apple. Apple is riding on a huge pile of cash from their highly popular iPod sales. They are also rumored to be investigating a possible iTunes like service for Movies. Plus Steve Jobs claimed this year to be the year of HD editing. The two companies customer base is made up of the same type of individual (highly loyal to their brand). I think this could be a great move for both companies. But I doubt it will happen. It just makes too much sense.

I do wonder, with the advent of a Tivo SDK, how long it will be before a Napster type application is unleased on the internet. It can't be too far from reality given that the sharing framework is already well defined, and the ability to bring the Tivo content to a local PC already exists (TivoToGo Desktop). I can't fathom the effect on Tivo as a company, and I can only imagine what the TV industry's reaction would be.

[doofie]

ReplayTV tried to outdo Tivo several years ago by putting its users ahead of the industry: automatic commercial skip. DRM-free show sharing across WAN or LAN, and so on.

All it got them was sued into smithereens and a 3% marketshare vs Tivo, which has always played safe and become the industry's lapdog. To the point where the Tivo functionality, always a bit restrictive, is now being progressively whittled away to a point where the Tivo "experience" offers little benefit above a standard cable box.

You will only prise my ReplayTV remote from my cold, dead fingers!

[ch]

i'm listneing to lily, rosemary, and the jack of hearts as i read this thing about the tivo, and i saw that blood on the tracks was your second favorite album of all time. cool

[Guilherme Sa]

Tivo is betting on an old-concept. Recording things are no longer important. Why must you record if you can get it on-demand? I wish it wasn’t that way, but apparently, that’s how the government and the media want it to be; I wonder why. It is just a matter of time until cable/sat providers start offering everything on-demand. Maybe we're a couple of years behind, but everyone must agree with the simple fact that you cannot purely rely on a simple box with great recording functionality. Perhaps it is a good ground by which the company can stand on for another year, but if by one year it is still fully dependent on this single feature, the product will definitely die, I assure you all. This is a complete new market, and everyone agrees Tivo has the largest brand name, but to compete and survive in the future, you must rely on other features.

In a Slashdot post, user Thomas Hawk wrote the following. Here is where the SDK concept should go:
“Offering viewers alternative television programming at the smallest level is a reason to upgrade. We all are fanatics of something, hobbyists, enthusiasts -- fractured in our pursuits, but even more enthusiastic about them than television. This is the power that is eBay. They tapped the commercial market of the fractured hobbyist. Initially research should be done to find the most profitable niches below mainstream television for maximum penetration. However it will not stop there. As crazy as it sounds, you may be able to TiVo your kids' little league game and watch it later as someone on the team picked up the responsibility of videotaping it... or perhaps the Little League organization itself subsidises these tapings to promote their organization and bills the teams through the standard fees and dues. Television is kind of important to a lot of people, but if your son plays Little League then this is much much more important than television could ever be to you. To be able to watch a Little League game afterwards with your son when you were out of town on business and missed the actual game or to let grandpa back in Maine get a season pass to the games, now THIS will drive box sales and TiVo subscriptions. High school football, missed class reunions, church services, obscure sports, anything and everything will be recorded and offered through guides, rankings, searches, etc. from the comfort of your living room.” –[end of post]

Unless they revolutionize television viewing through some form similar to what is said in the post above, where you are able to watch your grandchild’s Little League through someone who is responsible for videotaping it, what good will Tivo serve? My only guess is seeing them as being the union to all of this content, much like Google is the union to other forms of content on the Internet. Ironically, 4-6 years from now, won’t the Internet and TV be the same thing? If Tivo really decides to be the union to media content, what differences will it have over Google? Currently, Google runs R&D on search algorithms, in the hope it will attract the public, and then advertisers to generate revenue. Tivo has also been through prosperous times, R&Ding technologies approved by the government that resolves the issue with copyright usage so we can legally “share” content. These two companies are currently on two different quests at the moment, but what will happen when our bandwidth is high enough, allowing television to fuse with the web. TV networks will provide interactive, on-demand content. What else is there for Tivo to do? What good is there to allowing us to record and share a show, if the show can be watched anytime, anywhere, through streamed, on-demand service. Tivo’s only role from that point will be to unify all of the content offered by various networks (a search engine for television).

But what will then be the difference between a future Google and Tivo? Isn’t the final objective of both to find desirable content? Today Google owns Internet search, and likewise, Tivo owns TV search. They both have similar objectives, and only a slightly different form of working with the content. Tivo lets you record things, but that alone won’t maintain Tivo. The only left over market for them would be uniting all of this new televised content from various networks into some form of search technology; which would be very useful. Another huge market niche noted on a post on Slashdot by Thomas Hawk is going after below mainstream television, almost like a video blog. Some kind of technology which will use the Internet and a SDK to let, say, a grandpa, watch his grandson’s baseball game through his Tivo box. But isn’t that exactly what Google, Microsoft, or other search technologies are trying to do? The video blogging stuff is new, Tivo should go after. Try to get ahead before Google does.

For all the incredible things Tivo allows for, I can’t imagine a physical technology with monthly fees to live too long; they are fighting for an awesome concept, but where is this all going to lead? Could Tivo technology be the new middleman for copyrighted works, serving as a DRM? If Tivo currently was in the right path, it would end up head to head against Google, b/c they are basically the same thing. Think about it. The way things are going, I wouldn’t want Google as a competitor, so we have two choices: get in front with a NEW technology, or die. Video blogging and media content search should be Tivo’s priority.

[Guilherme Sa]

Oops, forgot the third priority: serve as middle man for copyrighted works - further develop their recording technology so we can carry copyrighted content around in a mobile, portable fashion. Amen!

[jackson]

I've never heard of TiVo, are they a Scandnavian group?