[opendtv] Will Souping Up TiVo Save It?

From: Monty Solomon <monty@xxxxxxxxxx>
To: undisclosed-recipient: ;
Date: Fri, 14 May 2004 09:49:49 -0400
MAY 17, 2004

INFORMATION TECHNOLOGY

Will Souping Up TiVo Save It?

Why investors, spooked by the competition, may be fleeing its stock too soon

Michael Ramsay, chief executive of TiVo Inc., has heard the eulogies 
for his pioneering company many times before. Yes, digital video 
recorders, which let viewers pause live TV, zip through commercials, 
and automatically record their favorite programs, are suddenly hot. 
And yes, TiVo's name has become virtually synonymous with the 
technology.

But the five-year-old company faces an onslaught of competition, and 
its strategic position seems hopeless. Most of its customers buy 
stand-alone boxes, then pay $12.95 a month for TiVo's "time-shifting" 
service. Now, cable companies are beginning to offer similar services 
for lower subscription rates with no up-front cost. Worse, Rupert 
Murdoch's DirecTV, TiVo's biggest customer, is considering using 
technology from another Murdoch company to replace TiVo in at least 
some of its satellite boxes. Investors certainly are spooked. TiVo's 
stock is down 50% since last July, to less than $7. "People are 
assuming the worst," says analyst David Farina of investment bank 
William Blair & Co.

But tap that pause button for a moment. A close look at Ramsay's new 
plans for the company suggests that any requiem for TiVo may be 
premature. He's pushing to make TiVo less dependent on stand-alone 
boxes by striking alliances to have TiVo's software incorporated into 
hot-selling consumer electronics such as DVD recorders. He's aiming 
to get more revenue from subscribers by offering them cool new 
features, including satellite radio, digital photo editing, and the 
ability to surf the Web from TiVo boxes. And although many of his 
customers get TiVo to avoid advertising, he expects to build a 
significant business from selling opt-in ads specially crafted for 
his much-coveted audience. "TiVo has a lot of irons in the fire. I 
wouldn't write them off just yet," says analyst Michael Paxton of 
researcher In-Stat/MDR.

...

http://businessweek.com/magazine/content/04_20/b3883087_mz063.htm

 
 
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[opendtv] Will Souping Up TiVo Save It?

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