TiVo Lives
TiVo's DirecTV Demise and Yahoo Resurrection
TiVo rise after 2000 was a slow one. The PVR functionality had existed before but it hadn't captured the imagination of the general public. By mid '03 it had become an established brand and the very word TiVo had become a verb, synonymous with the use of a PVR (personal video recorder). That's a powerful branding step only known by the likes of Scotch tape, Skidoo and Kleenex.
TiVo hasn't exactly known a rosy path despite what might seem like a compelling success with their brand of video recorders. The company had great technology and a sound service with tangible plus sides to consumers, but it's never been a huge money maker. TiVo only announced their first break even quarter in August '05, having spent hundreds of millions by mid '04.
TiVo based their brand around a single good idea; this assures it a short lived dominance in a market that was about to become flooded with competition. Big name electronics companies like Sony, Motorola and Echo-Star built PVRs to compete with TiVo. There were also some smaller companies joining the fray offering complete PVR services similar to TiVo, such as ReplayTV.
Each PVR offering had their own vision as to what they brought the consumer. Sony created PVR's for HDTV's that were also HD-tuners. Most HDTVs are only HD-ready and don't really have tuners built in -- still a popular option in affordable HDTV. Cable and satellite providers began providing set top boxes with built in PVR capabilities, too, making them the no-brainer choice for anyone subscribing to satellite or cable. TiVo also competed in the receiver market with DirecTiVo. DirecTV had models of receivers with TiVo capabilities. DirecTV quickly became TiVo's main source for new subscribers.
Fortunes changed for the worst at TiVo by the beginning of '05. In January, DirecTV announced plans to create their own video recorder, ousting TiVo whose contract with DirecTV expires in '07. TiVo, it seemed, was on the ropes. Their stock plummeted and execs began to resign. By February '05 TiVo's stock dropped to just over 3.00, the lowest in over a year. Engadget puts TiVo on the deathwatch list as they looked as if they'd be down and out in a matter of months.
Things started looking up for TiVo when they landed a contract to provide their digital video recorder functionality to Comcast digital cable boxes in March '05 -- promising news. Suddenly, TiVo announced its first ever break-even quarter in August '05. Then in November '05 Yahoo and TiVo announced their collaboration to put web content onto the TiVo set top box that used HME. The Yahoo deal will give users a web portal through the TV, including news, weather and entertainment information all at the push of the remote control.
Speculation suggests this is a move by Yahoo to gain a place in the living-rooms of Americans. If all interested parties feel TiVo is doomed anyway, it could be quickly laid to rest through a buyout bid from Yahoo. Yahoo has their own interests and market in which to compete; they could be looking toward the future of home entertainment and competition like MSN.
Microsoft's Xbox Live Marketplace used by the new Xbox 360 could become a gateway to MSN's shopping market. Very likely, music downloads, TV shows and movies can be purchased through Microsoft's marketplace. A set top box would be welcome to Yahoo, offering their unique brand of e-commerce by the push of a remote control. This would give Yahoo unprecedented market penetration and will certainly give Microsoft a run for their money.
The future of the TiVo brand is uncertain and it could soon be the property of Yahoo, providing PVR set top boxes that run directly through Yahoo Shopping.
