TiVo CEO dismisses 'central' DVR, touts broadband use
Video Business
By Danny King -- Video Business, 1/7/2009 5:13:00 PM
JAN. 7 | TiVo Chief Executive Officer Tom Rogers said today that the chances of multichannel service operators like cable and satellite companies developing a centralized digital-video recorder system for their subscribers are remote because of U.S. bandwidth issues. He also said that much of his company's turnover rate is from satellite customers wanting to upgrade to high-definition service, and not from the slowing the economy.
Rogers, speaking at Citigroup's Global Entertainment, Media and Telecommunications Conference in Phoenix, added that recent content-delivery agreements with Amazon.com and YouTube have caused subscriber broadband hookups to spike, and that TiVo's October agreement to stream videos from Netflix (http://www.videobusiness.com/article/CA6609972.html?q=tivo) will do the same. About 85% of TiVo's newer subscribers "immediately" connect their DVRs to their broadband access, compared with the 50% hookup rate across all subscribers, Rogers said.
The content agreements "have turned us into a media center" for accessing new content, said Rogers. "From a consumer point of view, you don’t know where it's coming from and you don’t care."
As for the possibility of a centralized DVR system that would allow customers to ditch their machines, Rogers said the chances of a cable or satellite company building such an operation are very small because of the amount of information that would need to be transmitted between the centralized database and end user.
"The ability to the cable industry to implement a real centrally based DVR approach is highly unlikely," said Rogers. "Most players recognize that storage in the home is the game."
TiVo has been trying to augment sales of its DVRs by striking partnerships allowing content providers to send TV shows and movies directly to customers' televisions using the DVRs while agreeing to provide DVRs to cable companies like Comcast and Cox. In September, TiVo and U.S. satellite-television service leader DirecTV (http://investor.tivo.com/releasedetail.cfm?ReleaseID=331834) said they would co-develop a broadband-enabled high-definition DVR that would be launched by the end of this year.
Until then, the lack of satellite customers' ability to upgrade to high definition service using TiVo's DVRs will have a bigger effect on TiVo's subscriber-turnover rate, which is about 1.4%, than the slowing economy, Rogers said.
TiVo (http://investor.tivo.com/releasedetail.cfm?ReleaseID=350732) said in November that its fiscal third-quarter loss, excluding a $105 million gain from its April settlement of a patent-infringement lawsuit with EchoStar, narrowed as it cut hardware costs by reducing its direct sales of set-top boxes.
