Some TiVo Shareholders live in Denial
Filed in archive IPTV on August 16, 2005
The value of TiVo's shares declined over 6% in heavy trading last Thursday, after Reuters reported that directv CEO Chase Carey had said that his company would cease marketing and promoting TiVo's DVR service as soon as it launches a DVR of its own later this year. I am surprised that there are still TiVo shareholders that did not know that this was inevitable.
DirecTV's "DirecTV with TiVo" service currently makes up around two thirds of TiVo's subscriber base. At the end of the first quarter, 2.1 million of TiVo's subscribers were "DirecTV with TiVo" customers, as were 247,000 of the 319,000 net new subscribers the company gained during the quarter.
DirecTV is planning to offer a high-capacity DVR, based on the XTV technology of its sister company, NDS. In addition, DirecTV plans to launch sometime next year an ultra-high-capacity version of the new box, which will be designed to enable the satellite TV provider to download a broad selection of encrypted movies and TV programming to its hard drive. This move helps mitigate part of the competitive disadvantage it faces from the VOD services offered by cable operators.
TiVo appears to be conducting a two-pronged strategy to make up for the possible loss of the "DirecTV with TiVo" business.
On the one hand, it is pursuing deals with cable operators: in March, it announced that it had reached a non-exclusive deal with Comcast to integrate its service with the latter's DVR's. Time Warner Cable CEO, Glenn Britt, confirmed that his company is also in talks with TiVo.
On the other hand, it appears to be hoping to increase the appeal of its "standalone" service, by, among other things, transforming it into a vehicle for the delivery of broadband programming. On this second point, Om Malik has an interesting question: why not just buy Akimbo?
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Response from:
Janet
(01/10/09 7:25pm)
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Quick introduction
I have been a Tivo customer, devotee and advocate since their service was introduced to me (3-4 yrs ago +/-) and before they had any competition (DVR).
I called to disconnect one of my two Tivo accounts earlier in the year, as the box was malfunctioning (a Tivo box). I was convinced by a zealous customer service agent to maintain the 2nd acct as they would send me a "deeply reduced price" replacement box that had added capability (tape two shows at once--wow!)
Come to find out this feature is rendered useless in the new all-digital world we are entering.
Talked to three Tivo customer service reps at Tivo today to find out that none of them are empowered by the company to recognize that the relationship with me -- a longtime, loyal customer, is more important than a 30 day return period; or is empowered to do whatever is necessary (very little, in fact) to maintaining me as a devoted customer and keep me from moving over to the competition.
I am deeply disappointed, but also warn senior management and, more importantly, I warn share-holders that this company is doomed for failure. While they might have at one time, they no longer "own the market," (DVR) and letting customers like me go without a fight is a clear signal that the competition has the edge.