TiVO WOES

Variety reports that TiVo is having trouble catching despite dropping prices:

TiVo, the reigning brand leader in the nascent digital video recording market, announced plans Friday to cut its retail price to just under $200 in an effort to spur holiday sales and stave off an inevitable price war with cable operators starting to roll out their own cut-price DVR combo boxes.

The San Jose-based technology company will offer a $50 rebate through Dec. 31 on its industry-leading Series2 models, which store up to 40 or 80 hours of TV programming. Rebate will knock down the price of its 40-hour box to $199. Customers still must also pay a $12.95 monthly subscription. Offer will not be available to customers opting for the already discounted DirecTV-TiVo service, which costs $179 for the box, plus a $5 per month subscription charge for regular subs.

But the price cut may not be enough to prevent TiVo’s ultimate extinction in its current business model, say some analysts.

TiVo, which has only 800,000 subscribers despite its cult-like status and almost reverential word of mouth, admits that future growth may depend in part on joint venturing with cable operators in the same way that it has with DirecTV.

Interesting. I am seriously considering making the jump, since it’s now only $5 a month extra for DirectTV subscribers plus an initial investment of $179 for the box.

This development is interesting, as well:

But more worrisome for TiVo could be News Corp.’s pending takeover of DirecTV and the prospect that Rupert Murdoch’s company may prefer to use its own NDS digital recording service, as it does at BSkyB in the U.K. At a meeting with analysts on Wednesday, soon-to-be DirecTV CEO Chase Carey emphasized that DVRs would be a central part of future strategy, though he stopped short of promising a free DVR offer, as hinted at by News Corp. chairman Rupert Murdoch earlier in the week.

(Hat tip: Jeff Jarvis)

FILED UNDER: Popular Culture
James Joyner
About James Joyner
James Joyner is Professor and Department Head of Security Studies at Marine Corps University's Command and Staff College and a nonresident senior fellow at the Scowcroft Center for Strategy and Security at the Atlantic Council. He's a former Army officer and Desert Storm vet. Views expressed here are his own. Follow James on Twitter @DrJJoyner.

Comments

  1. Anonymous says:

    I got a Tivo this last spring and LOVE it. Skip annoying commercials, watch when YOU want to watch, not when the networks dictate. For $5 a month for the satellite version – less than most people spend on coffee in a week (day?).

    Yes, call me one of the “cult-like” followers.

  2. James Joyner says:

    Yeah. I’d never watch anything “live” again. Even sports events, I’d likely tune in 15 minutes after the start time and fast forward through commericals and such.

    I’d been holding off until now to wait for the prices to come down and the bugs to be worked out. I think I’ll bite the bullet next month in conjunction with my move.

  3. You MUST get the TiVo! Make sure you get the one specifically built for DirecTV.

  4. jen says:

    I want TIVO!

  5. James, the DirecTV units are proven technology; I’ve had one for 2+ years. No need to wait for the bugs to get worked out. Take the plunge!

    BTW, the DirecTV/TiVo service fee is $5 per account, not per TiVo, and is waived if you subscribe to Total Choice Platinum (i.e. everything except the pr0n and sports subscriptions).

  6. James Joyner says:

    Good to know! I’m moving to a new townhouse at the end of the month and will take the plunge then. Everything I’ve read makes it sound quite worthwhile.

    I had the Platinum package when I signed up a year ago but got it “free” for subscribing the NFL Sunday Ticket. But I couldn’t justify an extra $50 a month to some movie channels I seldom watched, so dropped down to the basic package plus locals.