Now, we're talking! Here's someone who is not afraid of taking on Microsoft directly...probably best for everybody that he's not interested in the Tivo CEO slot, huh?
Okay, so his basic premise is:
"I'd walk away from the cable and satellite operators who only want to commoditize Tivo and focus on building a low end version of a Media PC that allows people to bypass the cable and satellite operators and get their entertainment directly from the Internet."
Strangely, that has pretty much been done, hasn't it?
Doesn't ANYONE understand that the hardware is already commoditized? (Whether you are talking about PCs or DVRs, or automobiles for that matter!) Just because something has been commoditized, doesn't mean there is not a full range of market opportunities.
More important, doesn't anyone understand that the GOAL is NOT a PC? The goal is a $50 set-top box that is operator-independent and offers (1) direct TV viewing with rewind/pause/record on the fly; (2) timeshifting (not via VCR+ codes or manual programming, but via an intelligent agent) with Season Pass and Wishlist capabilities; (3) home networkable along with direct interface to PCs (and potentially other network devices in the future: i.e., security cams, home control, etc.); (4) Internet-enabled for additional value-added content and services.
Why is that the goal? Because that is the reality of today's entertainment marketplace. Is it attainable? Apparently. After all, I bought 3 Tivos for $50 a piece last summer, directly from Tivo. At this moment, they are my set-top boxes (I don't use cable boxes). They are networked and remotely programmable over the Internet. They are interfaced to my PC network and transfer any desired recordings to a file server for longterm storage and/or conversion to a portable format for viewing on a laptop or dedicated video player. At this moment, developers are RELEASING proof-of-concept applications to demonstrate #4 above ("Internet-enabled for additional value-added content and services").
Now there are a few drawbacks: Most notably, streaming/transferring from the PC network BACK to the Tivo...but the reality is that should be completely doable--just not yet. Multi-room synced audio (which is probably not going to happen, and that is the biggest problem--but again, it should be doable, especially in a third generation device.
Yes, I said it, a third generation Tivo, because that is the situation: Can Tivo be viable NOW, and demonstrate (and DELIVER) a timely third generation device? Why, because even in a commodity market, a full range of opportunities exists for a super premium player. The software is SO close. If they can push through a stable HME component (with just one or two major partners--eBay and NetFlix sound pretty good, but BestBuy is a possibility, too, for music sales) and tweak a couple of other aspects of the existing software (including direct remote control of all networked Tivos from each other AND the PC network) and, finally, include CableCard support...
Sorry, I get excited, not because Tivo is the solution, but because it is the next step. Just updating the software features as described and limiting themselves to 40gig boxes, Tivo has to be able to scale a low-cost $50 box (my guess is they were testing that premise with last summer's rebate on re-man units). The CableCard functionality and the whole house sync'ed audio--even direct remote control of other Tivos--can all be bundled into the third generation device. Heck if they throw in a card reader and cd ripping capability, too, then they are super premium again. Worth $199? Probably. Worth $299? Maybe. What if every home had one master Tivo with all the bells and whistles, and the others acted as satellites? $299 for the hub, $50 each for as many satellites as you wanted?
How is that any different than Microsoft? With it's Media PC and Media Extenders (including for the XBOX)...it's different in terms of price, complexity and user interface. No one associates Microsoft with TV (despite MSNBC, etc.).
Tivo's razor edge is that it cannot fully commoditize the hardware until it's generating enough subscription revenue to sustain a blazing software development effort. That's why I spent so much time on these silly projections (and on my dissatifaction with Om Malik's ideas).
I don't think Tivo needs to be bought. I don't think Tivo is doomed yet, either. I think they need one more major software update--fast; along with 2-3 major content partners. If they can do that this year--with or without third generation hardware--they should be huge.
Does that mean they won't be bought? No, but I have seen and heard no credible news of this as a possibility and therefore can only discard it as stock speculation and the self-referential ramblings of the blogspurts, er, blogperts(?!?!?)
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