Is TiVo History?

Faster than you can skip through annoying television commercials, digital video recorders (DVRs) have jumped from the retail shelf through tv cables and into satellite set-top boxes. That’s one reason Yankee Group is predicting that stand-alone DVRs will be gone by by 2010.

Although 18 million U.S. homes have DVRs, only 2.3 million are stand-alone, according to Todd Chanko of JupiterKagan Research, TiVo accounts for less than 2 million digital video devices.

With the majority of DVRs in use installed in cable or satellite set-tops, stand-alone DVRs, such as those offered by TiVo,  are on the fast-track to becoming obsolete, the firms argue.

Despite TiVo’s recent licensing agreement with Comcast to provide DVR services to some Comcast subscribers, it won’t be enough to help TiVo survive.

“Licensing is a short-term solution,” Joshua Martin, author of the Yankee Group report, told For TiVo, he thinks the best future could be as a label.

“TiVo has incredible brand value that resonates with customers and it will be an asset to any service provider, increasing the likelihood of an acquisition,” he said.

Martin told the commodity-like status of DVRs means TiVo, one of the companies most closely linked to the technology, cannot survive in its current form. On the other hand, it has a few cards to play.

TiVo’s user interface wins rave reviews for its simplicity compared to alternatives.

For cable and satellite DVRs: “the interface stinks. They do a really bad job of it,” Gartner analyst Van Baker said.

But despite its relatively small but loyal legion of fans, TiVo erred by charging for the DVR hardware as well as running into delays both in offering its Series 2 version and high-definition devices. Both delays prompted subscribers to investigate cable and satellite alternatives, Martin believes.

Rumors of TiVo’s death are greatly exaggerated, a TiVo spokesman said. Plus, it’s not the first time these kinds of predictions have been called on TiVo. He declined futher comment, noting only that the company has more to offer.

TiVo prompted what Martin dubbed Advertising 2.0, as a way to tag new strategies required to engage the TiVo generation. Among the opportunities for DVRs: time-shifting and location- relevant software, interactive ads and product placement.

Plus, there’s no denying the legacy that TiVo helped challenge the television/advertising model, Martin added. “The era of the 30-second spot is fading away for all age groups and demographics.”

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