Tivo’s Death is Television’s Future

I love my Tivo, but it’s doomed. It’s a box that’s ahead of it’s time but behind the eventual truth of what television will be: what you want, when you want it delivered over the Internet. When Tivo dies, we’ll know the future has arrived or that it’s at least a bit closer.
The Successful Failure of Tivo
Tivo is a marketing success and a product failure. Tivo has been around for quite a few years and has had word of mouth advertising so prevelant that the companies name is now a verb (much to the disdain of Tivo’s lawyers). Despite this success they only have somewhere around three million customers in a nation of serious television watchers.
So, what’s the holdup? There is a certain resistance among users in changing their habits in a very habitual activity and also some potential user loss in those who don’t fully understand the service, but these aren’t the true barriers to Tivo’s success.
Tivo Innovates for Table Scraps
The real problem for Tivo is that it isn’t a standalone product. Tivo is merely an add-on to a service you already pay too much for. Tivo’s dependence on a market that already price gouges it’s users is it’s fatal mistake. How is Tivo supposed to make a profit when the cable companies and sattellite providers already suck every available penny off of the table?
Anyone who pays a cable bill cringes at a cost which has risen ridiculously from year to year, but most of these systems are regional monopolies leaving you with little choice if you want a moderate selection of channels. Someone who already resents paying $50 US or more a month for their cable will be hesitant to submit themselves to an additional $12.95. There’s no real competition in television delivery and, as a result, no real deals to be had when choosing how to receive your programs. Tivo offers users some power over their programs, but not nearly enough.
Tivo Wasn’t the Revolution
Tivo is just a tool that augments the outmoded distribution model of television to a simulated future of on-demand distribution. Tivo is a stopgap measure and, as a result, Tivo will pay dearly for both it’s innovation and for not innovating enough. The real change for most consumers will not come when they buy a Tivo (they never will), but when television is finally delivered on-demand over the Internet. You watch and pay for what you want, and only when you want it. People will happily pay for the content they want. They already pay too much for content they never use. The revolution in television is coming, but it won’t belong to Tivo.
Will Tivo Survive the Transition?
It’s probably safe to assume that at the very least the name will survive. Perhaps Tivo will survive the difficult transition, but I can’t help but think that it will survive much the way Napster survived: in name only.
In the meantime, I’m genuinely happy to own my Tivo. I may not have the future I want now, but at least I have a decent simulation to tide me over.

Permanent Link



Hi. Interesting post. But I do not follow your logic. People hate paying for cable. But they will gladly pay on a per-program basis for downloading programs over the internet.
According to Nielsen, the average American adult watches 4+ hours of TV per day. I just don’t see internet downloads replacing the convenience and ubiquity of the ‘tube.
I have two papers on this topic available at
http://papers.ssrn.com/sol3/cf_dev/AbsByAuth.cfm?per_id=586551