TiVo Price Slash- cause and effect
Well, it’s been a while since I fired up the old Media Box, and I think we’re well past due for another exciting episode of This Week in DVR. So let’s dust off this sucker and see what we’ve got, shall we?
Beep boo boo bee beep boo beep boo, Beep boo boo bee beep boo beep boo. Beep. Boop. Boop.
Price cuts!
I’m sure a lot of you are already aware of TiVo’s massive price cut: $50 for a 40 hour DVR box after rebate or $150 for an 80 hour box after rebate. Whether this move turns out to be good, bad, or ugly it is surely a bold one on the part of TiVo. The likely cause for the price reduction is the recent falling out between TiVo and former partner DirecTV, the major satellite TV provider. Up till now, over 60% of TiVo’s customers have been referrals from DirecTV, but now the satellite company has opted to go with a digital box manufactured by NDR (the two companies share the same parent: Newscorp).
So the price reduction is apparently a reaction to this. TiVo has to make up the loss in sales somehow, and a price cut is probably the easiest way to stimulate sales short term. However, there are many claim that this move is only further evidence of TiVo’s downward spiral. The question is: can TiVo survive without solid partnerships with cable and satellite providers? Bottom line- TiVo is pretty useless without digital content to record, whereas content providers such as DirecTV can manufacture their own boxes for cheaper.
A price cut, while perhaps a necessary short-term move, will not secure TiVo’s future profitability. Only more solid innovations can do that. Perhaps a partnership with Netflix will be the answer.