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ReplayTV Switches To Subscription Model For New Unit
aclute writes "ReplayTV is going to move to a subscription-fee for it's new 4500 series in order to "meet the needs of national electronics retailers with lower overall costs and increased promotional opportunities" and "ensure the long-term success of our ReplayTV retail strategy". No talk yet of the cost or a lifetime/yearly option yet. Looks like TiVo might have had the right idea after all." I still want to get a 4500, but the vendor lockin with someone who's being sued by *everyone* does throw some cold water on desire for the machine.
Guess I'll be getting that Pong marathon off Kazaa...
(2,3-Benzopyrrole)
It's all about profitability for SONICblue, and they're counting on long-term customers who feel better about spreading out the cost of the service versus paying up front for a lifetime subscription.
Assuming a lower cost barrier to entry and an ease of unsubscribing with no penalties, it benefits consumers to buy into this model. Consider a better, newer, faster, cheaper technology coming out in 1 year. If the consumer has paid less for the Replay 4500 + 1 year subscription than they would have invested with a lifetime-subscription Replay, they have more incentive to break away and invest in the new technology.
SONICblue's home is that they are the ones making that better-faster-cheaper technology and roping in existing subscribers to it. They may be too slow, however, as they'll also be concerned with sustaining their Replay business as well.
I predict a fleet-footed R&D-focused company will edge them out in 1-2 years on this subscription model.
This new pricing model does not apply to SONICblue's current ReplayTV 4000 or to prior offerings, which will continue to include a lifetime service subscription
Sounds to me like they plan to continue support for the 4000. End of Life does not mean that they will stop supporting it as if it never existed. It just means they will pull it from retail shelves to favor the 4500 and their new subscription policy.
There is no reasonable defense against an idiot with an agenda
:wq
but the vendor lockin with someone who's being sued by *everyone* does throw some cold water on desire for the machine.
The lawsuits indicate a long-standing philosophical difference between TiVo and ReplayTV. When both companies released their first products (within a month of each other, I believe), ReplayTV had a 30-second skip button for instantly jumping over commercials, and TiVo said they would not include such a feature to avoid annoying the networks.
Now ReplayTV 4000 units include more consumer-friendly features that are even more annoying to the networks. They include automatic commercial skipping (the same technology found in some VCRs for detecting commercials). And once you record something, you can send it to a friend's ReplayTV unit using the Internet.
If anything, the lawsuits are a reason to get a ReplayTV instead of a TiVo. You'll be supporting a company that is pushing the best technology they can; if it forces the networks to rethink their revenue model, that's a problem for the networks to deal with.
And even if for some reason the networks win their lawsuit, all it is likely to mean is that there will be a software update to disable whatever feature the court rules is illegal.
Computer-based solutions will always be a niche market. People don't want to leave their computers on all the time. People don't want to connect their computers to their home theaters. Sure, most people here think it is cool, but we're not most people.
SONICblue To Implement Service-Based Pricing Model For New ReplayTV Products; New Model Uncouples Service Fees From Retail Pricing to Better Meet Retailers' Needs
April 25, 2002 08:03:00 AM ET
SANTA CLARA, Calif.--(BUSINESS WIRE)--April 25, 2002-- SONICblue(TM) Incorporated SBLU announced today that it will apply a service-based pricing model to new ReplayTV(R) products -- beginning with its forthcoming ReplayTV 4500 series, the next generation ReplayTV offering. Separating service subscription rates from the retail price of the ReplayTV unit, SONICblue's new pricing model will better meet the needs of national electronics retailers with lower overall costs and increased promotional opportunities.
"We intend to achieve 30% market share for digital video recorders this year based largely on our entry into mainstream retail channels," said Steve Shannon, vice president, ReplayTV product marketing, SONICblue. "The addition of new models and pricing are just a few of the changes we'll be making to ensure the long-term success of our ReplayTV retail strategy."
Further details of SONICblue's service-based pricing model will be made available when the new ReplayTV 4500 series is officially unveiled this summer.
This new pricing model does not apply to SONICblue's current ReplayTV 4000 or to prior offerings, which will continue to include a lifetime service subscription. The ReplayTV 4000 line will end of life with the launch of the new ReplayTV 4500 series.
About SONICblue Incorporated (www.SONICblue.com)
SONICblue is a leader in the converging Internet, digital media, entertainment and consumer electronics markets. Working with partners that include some of the biggest brands in consumer electronics, SONICblue creates and markets products that let consumers enjoy all the benefits of a digital home and connected lifestyle. SONICblue holds significant financial assets, global marketing capabilities and a focused technology portfolio that includes Rio(R) digital audio players; ReplayTV(R) personal television technology and software solutions; and Go-Video(R) integrated DVD+VCRs, Dual-Deck(TM) VCRs, and digital home theater systems.
Except for the historical information contained herein, the matters set forth in this press release, such as SONICblue's release of its ReplayTV 4500, implementation of the new pricing model, SONICblue's introduction of new ReplayTV models and pricing options, the ability to achieve lower overall costs and increased promotional opportunities, entry into mainstream retail channels, the intended 30% market share in the digital video recorder market, its success in better meeting the needs of the mainstream retail channel, are forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially, including, but not limited to the ability of the Company to enter into licensing agreements with manufacturers, the ability of the Company, its suppliers, retailers and distributors to meet scheduled release dates, the impact of competitive products and pricing and of alternative technological advances, the outcome of SONICblue's existing litigation concerning the ReplayTV products and other risks detailed from time to time in the SEC reports of SONICblue Incorporated, including its annual report on Form 10-K for the period ended December 31, 2001. These forward-looking statements speak only as of the date hereof. SONICblue disclaims any obligation to update these forward-looking statements.
Note to Editors: SONICblue and Dual-Deck are trademarks of SONICblue Incorporated. ReplayTV, Go-Video, and Rio are registered trademarks of SONICblue Incorporated. All other products and brand names as they appear in this release are trademarks or registered trademarks of their respective holders. All specifications may be changed without notice.
Contact Information:
SONICblue, Santa Clara
Tracy Perry, 408/588-8086 (Investor Relations)
tperry@SONICblue.com
or
The Bohle Company
Jason Wanacott, 310/785-0515 ext. 211 (Press)
jason@bohle.com
As a consumer, I'm simply not interested in any device that can be 'sued' out of existence. My VCR is ten years old, and will continue to work until the day it croaks. Even if VCRs are declared illegal tomorrow, it will sit in my house and function as long as I want.
Personally, I would not buy a device (like the Replay) that becomes a paperweight if Replay ends up on the wrong end of a lawsuit.
And let me make something clear - I have no problem with them charging a monthly fee in exchange for service - it's then my choice to decide whether their service is worth the fee.
The concern is whether they'll be around to provide that service at all. By making the device worthless without the service, they have crippled the product.
I'm turning off my +1 bonus since this is a bit of a rant. However, its a rant with some insider knowledge, so it may be worth reading. I used to work for a company that has been mentioned here on Slashdot twice. They make/made a multimedia convergence box that ran Linux and did DVD, MP3 ripping, MP3 jukebox, streaming audio and video, etc.
Our company effectively ran out of money last July/Aug./Sept. We still had partners with a major newspaper for $2M in advertising, and with a major audo components manufacturer (if you look at the box you would know whose products it looks like).
Anyway, we were looking for buyers, and SonicBlue made an offer. We accepted it, and the lawyers went into legal stuff. For months we all waited, until SonicBlue eventually pissed off our other partners so much that they walked from the deal. Needless to say, without the advertising money we were not as desirable and SonicBlue dumped us.
I guess my point is, SonicBlue is a bad company. They have a bunch of cash in the form of stock from the video card days, and they are spending it screwing up small companies (like us and the Rio Car).
I met Ken Potashner (sp?), CEO of SonicBlue. He was a whiny, slick marketer guy, may he roast in hell.
TiVo is a good company that customers can believe in. They make a good product (I have one), and they don't screw over their customers or business partners. I hope TiVo captures the whole market and SonicBlue goes bankrupt. Now that UltimateTV has been cancelled by Microsoft, it's a two horse race.
- Vincit qui patitur.