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Discussion in 'TiVo Mini' started by magnus, Mar 21, 2013.
What is your input, as I don't work for TiVo, or have access to their books.
TiVo's quarterly filings to the SEC provide some insight into the recurring costs TiVo incurs per retail (TiVo-Owned) subscriber. I won't go into details on the image below unless requested but a closer look at the numbers shows that TiVo's costs per DVR box are approximately $2.00/box/month. I suspect that there are some discounts associated with licenses on the Mini but I would not be surprised if Mini costs exceed $1.00/Mini/month.
FWIW, it was also revealed during Rovi's Q1 conference call that they receive approximately $1.00/mo for their guide data product (similar to tribune) and $0.25/mo for their tablet (e.g., iOS, Android) product. I'm nearly certain that TiVo pays similar fees to tribune. I expect that the cost of guide data and other licenses on the Mini is heavily discounted since the user is already a subscriber but the cost is not zero. Clearly this cost is recurring over the life of the box so there is some point after the box costs are amortized, in the case of lifetime, where the lifetimed Mini costs TiVo monthly while generating zero revenue.
It that zero revenue that I have a question about as TiVo sells ads and viewing data, but I have no idea how much per box TiVo gets for that.
So we can get pretty close with the math. And for comparing the two, the costs are the same for TiVo, so the comparison is just what the customer has to pay.
You'll notice a slight bump in ARPU for the last two quarters. That is service revenue associated with TiVo's acquisition of TRA. TiVo's advertising campaign's, prior to TRA, contribute a very small amount (pennies) per user/box.
As has been mentioned elsewhere here, if Tivo is paying anything for guide data on the Mini they either have some very bad contract negotiators or they're getting a discount on the main boxes. The incremental guide data cost for Minis should be zero.
I think Tivo calculated how much the mini would cannibalize sales of existing products and lifetime subscriptions and then set their pricing accordingly. I think they should have just accepted the cannibalization and tried to make up for it with volume since they would be a low cost leader.
That's my thought or they should have come up with a more reasonable fee for lifetime.
I thought the current fee for lifetime on a Mini is reasonable. Otherwise I would not have picked two up and put lifetime service on them.
Is reasonable, or is not?
Would have, or would not have?
Would not. I have two lifetime minis. I corrected the mistake in the post.
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