I remember when Motorola (yes, my employer) rolled out its first HD DVR years after TiVo and ReplayTV first hit the market. There was some general concern about Motorola being late to the game, but the truth was that DVRs hadn’t really made a splash yet, at least in terms of mass adoption.
Today, Leightman Research Group says that one in every five US households has a DVR, up from roughly one in thirteen in 2005. (NewTeeVee picked up the story) That’s pretty big growth, and yet TiVo isn’t seeing much of the profit compared to the cable and telecom companies that have swept the market. It’s an old story. TiVo is expensive. Leased set-tops from operators are cheap.
The situation could still change of course if and when Comcast starts rolling out TiVo software on Motorola set-tops. (Cox also has a deal with TiVo in place.) We’re supposed to see initial trials in New England this month. Will TiVo hit Comcast markets in the next nine days?
I’ve also thought that the Tivo is much more expensive than an MSO provided box in the past but as DVR fees increase, the difference isn’t quite as much as you’d think:
Over 3 years, the purchase of an HD Tivo and the $299 three year service plan costs about $560. The rental of a box from Comcast at $12.95/mo comes to roughly $460. I think the additional features and ease of use is worth the extra $33/year for a Tivo.
Thought this was interesting…
I agree with Tom. I think the point most people are seeing is the big upfront costs for TiVo. I have three TiVos all with lifetime service so I have had to worry too much about the cable DVRs. However after purchasing an HDTV recently and trying the Comcast HD DVR that money spent on TiVo is well deserved. It’s sad there haven’t been enough people adopting it. If I don’t hear much news about the Comcast/TiVo deployment spreading nationwide I think I’ll be in the market for an HD TiVo or its big brother.
One also has to consider that $560 dollar cost with respect to the cost of an HD television as people will likely be making these purchases along with a television purchase. If your spending upwards of $1500 on a TV to have the HD experience, its worth the 1.25x increase to have the Tivo HD experience. The 1.5+x increase of an S3 is much harder to justify.
DVR rental prices are going up in many areas and various services, plus there are often charges for CableCARDs. However, the cable and sat guys have a huge advantage being embedded the way they are. Not to mention there’s less worries if a DVR dies or if you need someone to come to your house and fix things. Thus the TiVo/Comcast and TiVo/Cox deals are very important – at least over the short term.
of course, for those of us who have more than one tivo, each additional tivo dvr only costs 6.95 plus any cable card fees. also, i’m hoping the tivo/comcast/cox software deal works, as it will almost certainly mean tivo will be more profitable, and they’re really only trying to be a software developer anyway. the boxes they sell are not that profitable when you factor in the tech support and the entire warehouse infrastructure. i think that’s what tivo really wants to be anyway. do we really care who makes the box, as long as its running tivo software??
Lets wait and see what the Tivo on Comcast MOT 6000 boxes performs like before we decide whether its just as good or not. I wouldn’t be shocked if it had the same performance problems (dropped button presses, slow response time) as the existing DVRs. We’ll know when we see it. Wait for a review.
Personally I’m not holding my breath. I’ll be buying a Tivo HD once the new HDTV I want comes out.
In my area, a charter DVR will run you $18/month in NON-HD! Sure the DVR itself is only $9.95 but then you pay the DVR access fee, then the guide fee, then one more fee for good measure… People just do not break down the numbers when considering the cost.
The comparo with the $560 figure in it isn’t complete.
First of all, with Comcast getting the HD DVR was only$3/month MORE than getting a regular cable box (which is needed for the digital channels.
Also, the $560 doesn’t include the cost of the cablecard(s) you would ned to get for the TivoHD.
Don’t get me wrong, I love Tivo (still have two 1st generation Tivo’s in my closet), but they missed the ball when they didn’t release an HD Tivo in time. I switched to Comcast’s DVR, and haven’t looked back. Sure, it is slow sometimes. But it’s cheaper, and it was available…