Could TiVo be coming back around to Lifetime?

by

CORRECTED 7/8/07 

TiVo is offering a special allowing certain Lifetime subscribers to ditch service on their old box and purchase a box plus a Lifetime subscription for $299.

The propensity to accept this deal is biased to the oldest boxes in service (S1s) because they are both elderly and don’t have the functionality of the Series2s.

When cancelling the Lifetime subscription offering, TiVo claimed it was because it lost money on the Lifetime offer.* The folks most likely to take this new offer have therefore been the biggest losers for TiVo; so why is TiVo reenlisting for another round of punishment (as per TiVo’s view?)

One answer might be that accounting issues will make the ARPU numbers look better today at the expense of the future (so TiVo would think,) and the cash line will get better. Not a good business choice, but maybe could help out some stock options.

The more important thought, I think, is if TiVo is willing to accept these few Lifetime transfers, might they be willing to sell new boxes with Lifetime service? How about Lifetime service to old boxes?

TiVo lost a tremendously powerful sales tool when it dropped Lifetime service. Its service business growth and SAC has suffered accordingly. Perhaps they are beginning to rethink their decision.

TiVo will find great and profitable success reintroducing a Lifetime plan. It will not lose money now anymore than it would have lost money had it continued to offer Lifetime.

* Of course, some of us chickens know better.

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6 Responses to “Could TiVo be coming back around to Lifetime?”

  1. HDTiVo Says:

    It seems that the box is included for $299. I corrected the article in red.

    Since TiVo is effectively selling the Lifetime for $200 vs $299 when Lifetime was discontinued, that makes the idea of reinstating Lifetime even more sensible.

    Either TiVo did not lose money on Lifetime before or they are looking to lose lots more with this offer. ????

  2. John Says:

    I just got my lifetime transferred to my series 3 for 199$ fee. I thought it was worthwhile.

  3. Bfdtv Says:

    Certainly by now Tivo must understand the resistance so many consumers have toward monthly fees. Many consumers will not buy a product with monthly fees on principle, regardless of whether the fees are $1/mo or $15/mo.

    As you note, Tivo has said in the past that lifetime was unprofitable over the long term at $300. But why not bring it back at a higher price? Surely there must be a point at which the extra fee is profitable over the long-term.

    I would like to see the Series3 “Lite” offered at 1) $299 with monthly fees or 2) $699-$799 with no monthly fees (i.e. lifetime). The lifetime does not need to be transferable. They could even call the lifetime unit a “Special Edition” and sell it with a larger hard drive for $999. Wouldn’t that be a great for customers and investors alike?

    Tivo Series3 (160Gb)
    $299 + monthly fee

    Tivo Series3 Special Edition (160Gb)
    $699 + no monthly fee

    Tivo Series3 Pro Special Edition (500Gb)
    $999 + no monthly fee

  4. HDTiVo Says:

    I like your thinking, but not your numbers.

    What TiVo must do is de-emphasize its pricing for its traditional service and emphasize value added additional services like content, as well as advertising revenues.

    Historically TiVo has not had much success selling its service. DVR/DMR buyers are not in the market for a service (ala TiVo) but a device. TiVo needs to finally realize that, especially with competing products emerging.

    Lifetime is a way to sell their product as a device instead of a device plus a (unvalued by the consumer) service. It is also made more viable if TiVo emphasizes the content/ad reliance for revenue I mentioned.

  5. Kracko Says:

    I just called Tivo today about a series 3 box. They were offering the Series 3 for $512 (isn’t there a price cut coming next month?) and a transfer of my lifetime service for $299.

    I think I’ll wait for the price cut next month.

  6. HDTiVo Says:

    I am not sure what will happen next month – TiVo only extended its rebate thru July 28th.

    You may be thinking of the new Series3-Lite which is expected to be $299 starting sometime in August.

    The $512 and $299 transfer are new to me. The Lifetime transfer had been $200, and there have been steady reports that even though that had expired long ago, people could still get TiVo to give it to them.

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