Rumors have been running rampant on the Internet the last few days that TiVo is exiting the hardware business. It started with this Wired piece claiming TiVo laid off most of it’s internal design team and would be pushing towards a “cloud DVR” and licensing deals with cable companies. Harry McCracken writing for Time tried to calm some of the rumors calling TiVo’s official reply a denial. TiVo has since re-posted the Time story on their social media sites.
For me, I’m not so sure. I’ve been a TiVo fan since the early 2000s when I bought my first Series 2 box. I’m such a fan of the TiVo service that I said I would give up my cable TV before I gave up my TiVo. In fact, I did when I “cut the cable” three years ago using a TiVo HD box and a digital antenna as my primary sources of content. But I’ll admit TiVo has lost it’s luster a bit for me over the past few years. My current home entertainment setup includes two TiVo HD boxes (one in the bedroom, one in the living room). I bought one in 2005 and I understandably had to replace the hard drive last year. The second box was purchased in 2010 and is now going on four years old. I initially purchased these boxes for a couple hundred bucks each, then paid monthly for the TiVo service. At the time I bought my first TiVo box I was just getting established in a new job and spending the money for lifetime service was a stretch for the budget. In retrospect, that was a mistake and I’ve since been able to add lifetime service on one of my boxes with a special promotions for existing customers.
TiVo’s pricing plans have changed over the years. With the original TiVo units you could buy a true “lifetime” service that would supposedly be good for your lifetime and transferable to future boxes, what a deal! That quickly went away and lifetime then came to mean the life of your box. There were lots of debates as to whether lifetime service was a good value given the life expectancy of a TiVo. At the time I bought my TiVos, the boxes were a couple hundred dollars and service could be bought on a month-to-month basis for $12 for the first box and $6 for each additional box with no commitment. The general consensus was if you could afford it, lifetime service was probably a good deal on your first box as the “break even” point was about 3.5 years, but with multi-service discounts didn’t make as much sense for additional boxes. Now, shops like weaKnees have popped up to sell replacement drives (the most likely point of failure) and repair broken TiVos so customers can extend the life of their box to preserve their Lifetime service benefits.
TiVo changed their pricing plans a couple years ago to what I’ll call the “cell phone model” (because everyone loves cell phone companies!) They started selling a a $99 box, which, in my opinion, was crippled with a woefully small hard drive, and then subsidized the cost of the box with a $20 a month service fee and a one year service commitment. The TiVo service fee pays for the guide data that TiVo uses to find and record programs, as well as presumably software updates for new features and continued support. TiVo has since adjusted their pricing models with low-end boxes now starting at $200 and service plans starting at $14.99 with a one year commitment or product lifetime for $499. Service discounts are offered to current subscribers or subscribers with multiple boxes.
At this point my 8 and 4 year old TiVo HDs continue to function for recording capabilities and receive updated guide data, but it’s been years since I received any updated features or benefits and I can’t help but wonder why I’m continuing to pay monthly fees so long after my subsidy has been repaid. I was able to convert one of my TiVo boxes over to lifetime as part of a special promotion, but still dutifully pay $7 a month (a grandfathered rate) on the other and the only benefit I can tell I am receiving is updated guide data. In retrospect, I wish I bought Lifetime no both my TiVos at the time of purchase.*
But, lifetime also presents TiVo with a customer upgrade problem. While my old TiVo HDs don’t have all the fancy features of the new TiVo Roamio, which the reviewers have overwhelmingly praised as the best TiVos yet, it still works just as well today as it did the day I bought it. It finds and records my show in high definition and the lifetime unit costs me nothing. I’d really like to upgrade to a new TiVo Roamio, but by the time I priced it out, I’m close to $1,000 to replace my existing setup and the extra features I receive aren’t all that important. An couple of extra tuners and some streaming video features I likely wouldn’t use anyway because I have an Apple TV. (I’m pricing a base model Roamio because it’s the only one with OTA support, adding in $200 for a hard drive upgrade because the hard drive on the low-end model is unacceptable, adding a TiVo mini to replace the TiVo in my bedroom and lifetime service on both devices).
Where is TiVo going? I don’t know. I’ve wondered for a while. I haven’t upgraded my TiVos in years mainly because I haven’t seen a compelling reason to. While I would love a new TiVo Roamio, I just can’t justify the cost given they don’t offer me enough benefit over my current setup. TiVo has a loyal following, but their marketshare has always been relatively low. (Remind you of anyone else?) TiVo’s great asset is that they were one of the first in the DVR space and scored big with some early technology and patent victories. Today a large percentage of their income comes from fees paid by companies with far inferior products.
I suspect the Roamio is the last line of TiVo hardware. It’s interesting that in the past week alone, I’ve received a number of personalized solicitations direct from TiVo offering deep discounts on the Roamio. That’s odd given it’s such a new product. There will probably be some revisions (larger hard drives, maybe the addition of an OTA tuner to the higher end models, technology updates) and some software updates over the years, but the core TiVo product hasn’t changed that much since inception. As for the future, the cloud-based DVR is a great idea in concept. But I suspect data caps, lack of ubiquitous high-speed Internet and “anti-pirating” limitations will continue to frustrate for a longtime. TiVo has tried licensing deals with the cable companies to put the TiVo software on cable boxes in the past and for whatever reason, this has never taken off. Even if it did, I’m not sure it will end up being a great deal for consumers, and what about the cord cutters?
My plan, is to keep my existing TiVo HD boxes going as long as I can. I think the next 2–4 years will bring about great change in this area. Frankly, I’m hoping Apple will swoop in and solve this problem for me. An Apple TV with a fusion drive, cable and OTA tuner, DVR software and an App Store would be my ultimate “everything box”, I just hope they make that happen.
*Edit: After writing this post I decided to call TiVo customer service and discuss options. I was told due to my lengthy history with the company, the box I owned, and the length of time I owned and have paid service fees on my box they offered me a special promotion to pay a one-time fee of $99 and upgrade my box with $7 monthly service to lifetime. I'll have to keep my box 14 months for this to pay off, but given my history it seemed worth it. A quick search of eBay shows the value of TiVo HD boxes without lifetime service to be minimal, while boxes with lifetime service are selling for more than $100. Seemed like a worthwhile deal.