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TiVo switches off UK sales
SmackCrackAndPot writes "On the TiVo Community forum, there is an announcement that TiVo will be switching off UK sales.
This was previously reported in November at
BizTech Library.
It's probably not too surprising, after the BBC
spammed TiVo owners with a new comedy show."
.. also known as the loss leader, seems to be a defining practice in interactive home entertainment these days. That basically means that the company makes no money off the initial sale, but reaps high margins from subsequent purchases necessary to keep that initial device functional.
.. but that's another issue.
.. then trying to make profits by selling mandatory advertising spots to media companies. Unfortunately, there aren't enough TiVo users to convince media companies to pay big bucks for the spots.
It worked extremely well for Sony -- selling the playstation at zero (sometimes negative) margins, then making money by being the sole licenser of games (that they didn't spend money developing) for the platform.
I think the xbox is taking financially because Microsoft went out and bought a substantial number of good game development companies who haven't been able to release a seriously block-busting game
TiVo is a completely different story. They're selling the consoles at or below cost
The population of TiVo users has to grow -- and that means they need to lower the cost of their consoles. Dramatically. Even if it means reducing the functionality of the box. When TiVo costs $50, and you can buy it at Wallgreens, that's when advertising and media companies are going to sit up and thing "Holy crap, that's a huge captive audience."
TiVo may have seemed revolutionary in the USA, but in the UK it was just one of many enhanced TV systems.
TiVo's biggest rival, Sky Plus (Sky+) did everything that TiVo did, and more, came pre-packaged with an installation engineer's visit and had the branding and backing of the UK's largest pay-TV provider, Sky (backed by Rupert Murdoch/Fox corp).
Sky already had a shedload of TV toys. For instance, I remember one of my business meetings in Texas two years ago, the CEO of this oil firm was saying something like "In the future, you'll be able to watch a football match and zoom in on individual players".
Then I glanced down at the predicted coverage map for my GPRS phone in Texas...
Andrew Oakley - www.aoakley.com
AIUI, the TiVo box works by downloading listings via a dial-up connection, and MPEG-encoding an analogue TV signal.
The thing is, they released it in the UK after digital TV was "widely" available. IMHO, most of the people that would consider buying a TiVo are likely to be people who have digital TV.
DVB has digital, in-band listings information that can be updated in real-time if the line-up changes. Additionally, with something like Sky+ or one of the yet-to-surface digital terrestrial or cable DVR boxes, you don't have to decode the MPEG to analogue and then re-encode it to MPEG before you can record it. That makes for a cheaper box, with higher quality audio/video and better compression (so more stuff can be recorded).
I'm guessing that demand for integrated DVR systems will be much higher than it ever was for TiVo.
Registering accounts later than some other chrisb since 1997
This is ridiculous. Thomson stopped manufacturing TiVos in the middle of last year. This is not news.
It has been all but impossible to buy a TiVo in the UK for the last few months. This is not news.
Equally, the idea that TiVo will pull the plug on the UK market is ridiculous.
They have 35,000 subscribers paying £10 ($15) per month, and just two employees. So... £350,000 revenues a month, two staff, a couple of servers, a few phone calls. They must have some pretty expensive offices for the UK operation not to be profitable.
My forecast: when TiVo the company (ticker: TIVO) becomes profitable in the back half of '03, then management will again turn their eyes to other markets: Canada, Australia, UK, etc.
Anyone care to bet I'm wrong?
--- My dad's political betting