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Could Apple’s patent win help TiVo?

Discussion in 'TiVo Coffee House - TiVo Discussion' started by Johncv, Aug 26, 2012.

  1. Worf

    Worf Active Member

    Sep 15, 2000
    Actually, they make about $1.2B on online sales, i.e., iTunes. That's the 30% cut they made (so it's roughly $4B sales per quarter).

    Of course, it's a VERY tiny slice of the pie - you're talking about $1.2B revenue, when Macs sell an order of magnitude more, and IOS devices even more (another order of magnitude above that, I believe). Plus, it's revenues, not profit, so all that's re-plowed into iCloud and other services. And it's sales from apps, as well as much (30% cut too) and movies and TV shows (probably 30% cut there too - see a pattern?). And that revenue has to pay for hosting the free stuff as well.

    And don't forget that it's credit card fees and such - 20-30 cents per transaction plus 1-5% of total transaction value. Buy one 99 cent app a week and that 30% is consumed in charging your credit card.

    iTunes gift cards are probably break even as well - considering you can get them 20% off pretty regularly, which means Apple probably offers them to the store at 25% off cover price (i.e., a $100 iTunes card probably charges the store $75, so the sore gets $25 profit) since you can bet the store still makes a profit, and Apple's 5% goes into printing and distribution.

    In the end for Apple apps, movies, music, books, and TV are considered break-even-ish - value-adds for the consumer to buy Apple hardware. If you want to contrast this, take Amazon which sells content at a profit and hardware at break-even (Apple sells hardware, tosses content in as a value-add. Amazon sells content, tosses hardware in as a value-add.)

    Oh, and Apple's 30% cut isn't that high - comparatively. Books normally go for 50% off cover price wholesale. Console DLC can go between 25-40% off their sale price goes to the seller.
  2. atmuscarella

    atmuscarella Well-Known Member

    Oct 11, 2005
    Rochester NY
    I find this discussion about hardware versus content amusing.

    The demand is for content always has been always will be. Hardware without content (and yes software programs are content) doesn't do anything and is basically worthless.

    In the end the desire for content always drives sales of hardware. If consumers stopped wanting content they would have no use for the hardware.

    So regardless of where/how Apple shows profits it is because of the demand for and sale of content.
  3. magnus

    magnus Tivo User

    Nov 12, 2004
    And this gets to one of my points in a post a log time ago... Tivo needs content. Somehow they need to be able to deliver content like Apple does. I wish Tivo could somehow work out some deals to deliver the content... that would be nice.
  4. morac

    morac Cat God

    Mar 14, 2003
    I agree. Unlike with a phone, TiVo can't expect people to buy a new TiVo every two years (or however long they currently monetize a lifetime subscription).
  5. atmuscarella

    atmuscarella Well-Known Member

    Oct 11, 2005
    Rochester NY
    I agree that TiVo should be providing access to as many content producers and re-sellers as possible. Their really is no reason any other streaming device should have access to anything that isn't available through a TiVo. However I am not sure there is a case for TiVo to actually becoming a content reseller like Apple. I think there was a case a few years back but TiVo decided to go with Amazon instead and now I don't think there is any real opportunity for TiVo to move into the content reseller market.

    While Apple was a visionary with their iPod/iTunes combination they were also in the right place at the right time. The consumer desperately wanted a way to easily consume digital music and because content produces had refused to deliver it, a large black market had been created that was threatening the whole industry. Apple was able to deliver a solution that paid the content providers while protecting their content from theft, provided the consumer what they wanted, and at the time gave Apple a near lock on controlling digital music distribution and the hardware used to consume it.

    The situation is not the same in the video world. The video content producers are not in the same situation that the music content producers where in. So they have been much less willing to allow a major change like the music industry did. TiVo has to work in that reality but it is clear they are still trying to find ways to provide content to the consumer in a way that allows the consumer to consume it way they want to - the up coming "Stream" is an example of that.
  6. Johncv

    Johncv Active Member

    Jun 11, 2002
    Chula Vista, CA
    If TiVo had 198 Billion dollars in cash on hand, yes that Billion with B. That more cash then US Treasury. (Thank you George W. :p)

    Things Apple is Worth More Then: http://thingsappleisworthmorethan.tumblr.com/

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