TiVo Hopes to Sell Software to Other DVR Makers

[Jeremy Charette]

<div class='os_post_top_link'><a href='http://www.foxnews.com/story/0,2933,186788,00.html' target='_blank'>http://www.foxnews.com/story/0,2933,186788,00.html</a><br /><br /></div><i>"TiVo Inc. (TIVO) Chief Executive Tom Rogers hopes his biggest rivals in the television set-top box market — U.S. cable television providers — may soon be eager customers, but analysts are not so sure. Rogers told the Reuters Global Technology, Media and Telecoms Summit in New York this week that he hopes cable operators will be "hugely successful" in distributing generic digital video recorders, or DVRs. In many cases, these cable DVRs — able to pause live TV and skip commercials — are distributed free, replacing TiVo DVRs that typically cost at least $200 per household. That's fine, Rogers said, since TiVo eyes a future where it gains fee-paying subscribers without selling a set-top box. "We want the cable industry to have as many of those DVR boxes out there as possible," said the chief executive of the TV recording technology company. "We're a total software upgrade when you think of the cable side of our business. The more that are out there, the more we have an opportunity to roll out to, the more we have the ability for cable subscribers to become TiVo subscribers.""</i><br /><br /> <img src="http://www.digitalmediathoughts.com/images/Cover-Tivo.jpg" /> <br /><br />Like most smart companies, Tivo sees that the money lies in licensing and subscription fees, not in the notoriously cut-throat low-margin battlefield of consumer electronics. After reading this article, it is even clearer to me why Tivo has dominated in the DVR marketplace while its' competitors have languished. Witness this quote from Cisco's Chief Development Officer, Charles Giancarlo:<i> "With user interfaces, the technology is not very complicated. I don't tend to believe that user interfaces are all that hard to create..."</i> Doesn't he get it? Sure, they're not hard to create, but making a user interface that's intuitive, interactive, and that users actually enjoy is where the real challenge lies. Witness the success of Apple's iPod, Tivo, or the Xbox 360. They may not have the best technical specifications, but they deliver the best user experience, and that's what people are willing to pay for.

[Kacey Green]

the best user experience that the consumer is willing to pay for, and pay for, and pay for

until the next subscription service comes out.

residuals are the easiest money, you've already done the hard part, just repeat several times. The media companies are trying to form subscription based services but the consumer only wants hard media, unprotected so they can take it with them with out paying more than fair value for the media.

If they payed $12 for the video, why should they pay another six to put it on their iPod or Zen Vision:M?

[Jeremy Charette]

That's exactly it. People will pay and pay and pay, and frankly, I'm okay with that. I do it myself (I'm a monthly Tivo subscriber). I don't want to be locked into a single format or technology. I'd rather someone else pay the high cost of entry for the hardware, I'll just pay a monthly fee to "rent" it. That way when something better comes along, I can jump ship whenever I want.

That said, if I'm paying a fee for something that doesn't deliver what I want, I'm more than willing to do just that. Case in point: Time Warner is charging me through the nose for terrible digital tv service. So I think I'm going to can the digital cable, go analog, get another Tivo, and use an OTA antenna for my HD content.

I'd rather pay $13 a month for something that really works, than $73 a month for crap. Not to mention the fact that Tivo allows me to watch shows over the internet, download them to a PMC (and soon an iPod or PSP), and program my shows remotely. It's really getting to the point where what the cable company is offering isn't worth it anymore.