By Davis Freeberg
Editor’s Note Davis Freeberg is a shareholder of both Netflix and TiVo
I’ve got to admit that when I first woke up this morning I was a little shocked to see Dave Zatz report that you can find Blockbuster Online subscriptions through the TiVo website. TiVo has had a vaporware partnership with Netflix for sometime and while I didn’t expect that we would see TiVo would start showing downloadable Netflix movies anytime soon, I had always held out hope that we might see Netflix start bundling TiVo with their online service. The two services are a perfect marriage for each other, but it looks like TiVo has opted to go with Blockbuster Online instead.
I’ve got to assume that Dave Zatz’s screenshot was accidentally published by TiVo early because TiVo seems to have three different prices for the online service. All three packages include an 80 hour TiVo box for one year, but have price points of $29.99, $32.99 & 35.99. It could be that TiVo is still experimenting with the pricing on this or it might be that these three plans represent the one, two and three DVD at a time programs.
I know that in the past Blockbuster has sold TiVos at their retail stores, but it’s been a few years since I’ve seen Blockbuster carry TiVo. If TiVo is in fact turning their back on Netflix and going with Blockbuster Online then this represents a big coup for Blockbuster. The more DVDs that customers rent each month adds to the cost of maintaining an online program and if Blockbuster can give you 80 hours of customizable television, then it will inevitably reduce the number of DVDs that customers will rent each month.
I think that this arrangement makes natural sense for TiVo, but I’m pretty disappointed that TiVo didn’t make better use of their vaporware partnership with Netflix and sell their service instead. When their partnership with Netflix was announced there was a lot of hoopla from the stock market over it, but it appears that the only good thing that has come out of it was Michael Ramsey leaving the board of Netflix. Netflix offers a better online experience and their interests seem better aligned with TiVo’s, yet TiVo has still choosen to endorse a dying company with terrible customer service over a Silicon Valley start up that has changed the rental industry forever.
Given the amount of hype that we’ve seen for the Netflix player, it’s bitterly disappointing to see TiVo not make at least some use of their agreement and it makes me wonder if the Netflix player may also be at risk. I’ve always understood why Netflix would want to sell VOD over TiVo’s platform, but I’ve never understood the benefit to TiVo for doing this. Couldn’t TiVo license the content themselves and cut out Netflix as a middleman or is their relationship with Hollywood so bad that they knew that they had to use a Netflix or Blockbuster to get access to VOD content? Either way, this new partnership casts further doubt about the future of the Netflix player.