TiVo Facing Identity Crisis

TiVo Facing Identity Crisis – Yahoo! News: The Diffusion Group is out with a report today suggesting that as the TiVo DirecTV relationship winds down that TiVo will be forced to come to terms with a “increasingly competitive market flooded by free DVRs from video service providers:

Key findings in the report include:

* TiVo’s recent deal with Comcast will face many difficulties and have little impact, if any, in terms of moving TiVo DVRs. Architectural differences in software will lead to limited deployments and compromised functionality (especially when compared to stand-alone TiVos).
* TiVo’s forthcoming Series3 HD-DVR with Multi-Stream CableCard and built-in networking will be too expensive for most consumers and thus require substantial carrier subsidies to impact the market. With cable and satellite companies leasing similar products for little or no upfront costs, the HD models of the Series3 will see tepid sales.
* TiVo will win its patent dispute with Dish Network but won’t see significant revenue from the litigation.
* TiVo will remain unattractive as an acquisition target unless its stock falls to record lows–– an event that has been made more likely due to the departure of DirecTV. Should a suitor emerge, the buyer will most likely be a broadband content distributor or a large consumer electronics company — an Apple/TiVo merger is not out of the question.”

The Diffusion Group asks the question, can TiVo survive and offers what would appear to be their solution for the necessary evolution of the company:

“TiVo’s long-term survival requires a major transformation in its branding and positioning strategies,” continued Kipp. “It will simply not survive as a DVR solution provider. Instead, it must become a true 21st century media company, combining consumer electronics, digital audio, Web-based video, and T-commerce strategies, each with a significant Internet component.”

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