How much would you pay for Lifetime?

[Solver]

TiVo has discontinued selling life time subscriptions. Maybe they were not profitable at $299 a pop. If TiVo did bring back the lifetime option, what would you be willing to pay now? Would this be enough to make bringing it back profitable for TiVo?

Not that TiVo will bring it back. This is just a suggestion ;)


Be sure to look at the poll above.

[rdrrepair]

The cheapest "Lifetime Gift Card" on Ebay right now is $750.00 and the highest price is $799.00. :down:

http://cgi.ebay.com/TiVo-Lifetime-Gift-Subscription-Card-for-Series-1-2-3_W0QQitemZ140118636367QQihZ004QQcategoryZ147873QQssPageName ZWDVWQQrdZ1QQcmdZViewItem

For it to be that high it would seem that the market is willing to pay that kind of insane price. :confused:

[steve614]

Those Ebay prices are high only because Tivo isn't offering lifetime anymore.
If Tivo offered lifetime again at $399 (my vote), those Ebay prices would plummet.
JMO.

[MikeMar]

Those Ebay prices are high only because Tivo isn't offering lifetime anymore.
If Tivo offered lifetime again at $399 (my vote), those Ebay prices would plummet.
JMO.

umm obviously, they would drop to about 399 :D

They aren't going to bring it back though. Better to get a continual revenue stream than all at once.

See - cell phones, cable, internet, tons of other services

[tivoupgrade]

TiVo has discontinued selling life time subscriptions. Maybe they were not profitable at $299 a pop. If TiVo did bring back the lifetime option, what would you be willing to pay now? Would this be enough to make bringing it back profitable for TiVo?

Not that TiVo will bring it back. This is just a suggestion ;)


Be sure to look at the poll above.

Actually, TiVo discussed (in their annual report) exactly why "lifetime" subscriptions were a problem several years ago when they changed things. There is no way to predict how long people will use their units, and when they originally established the "lifetime" pricing model, they were assuming something like 2-3 years.

Obviously, they were very wrong, and every active system out there with no revenue associated with it is essentially a liability on their books, it really would have be priced significantly higher for it to be worth their while.

If, down the road, they begin to offer more pay-per-item types of services (downloads, feature enhancements, add-ons, etc), offering a lifetime subscription might still make sense, but there are no signs that something like that would happen any time soon.

In any case, interesting question.

[purefct]

If Tivo brought out better models on a regular basis, more people would leave their older models with lifetime for the newer model. Talk about lost revenue, letting 3rd party vendors sell the hopped up Tivo's is where Tivo went wrong. Not that they should block this ... my point is Tivo can clearly offer units with larger drives, additional HW features, and other perks with newer models each YEAR rather than each decade (OK an exageration, but hopefully you get my point). People would still keep their lifetime models forever, but more people would upgrade. Take me ... if a S4 came out offering lifetime and could record HD satelite I'd either add the unit or drop my S2 for the S4. Instead, Tivo charges about 3 times more per month than DT HD DVR and I signed up gor the DT HD DVR. I don't have lifetime on it, but at "$750" for lifetime Tivo my DT HD DVR would take 10 years of monthly service to break even and we all know these units will (probably) not survive 10 years of use and certainly not 10 years of tech advances.

I originally paid $299 for lifetime because $13/mo was break even after two years. That was a great deal! But I expected to replace the unit after 3-4 years AND WOULD HAVE if Tivo had offered a HD sat DVR. Instead I'm paying the $6/mo to DT.

[megazone]

TiVo has offered new products pretty much every year for a while now, sometimes more than one new box in a single year (S2DT & S3).

Satellite is out of TiVo's hands.

[purefct]

S3 came out more than 5 years after S2, far too long especially in light of competitors offering HD DVR first. S2DT was also too long in coming. These are great products, but S2DT should have come out two plus years ago when the breakup with D*v happened, and they aren't making a HD sat DVR because they don't want to integrate some FCC requirement in the box?

I'm talking about S1 to S2, S2 to S3, or even Tivo directly offering 500GB or 1TB units as a new model, not changing software features on units with primarily the same HW features. Granted, some new HW offerings are great (burn to DVD, etc) but Tivo rarely makes them a part of their core product, or frequently enough. Tivo can directly offer new enticing units. Why are they leaving holes in their product line and allowing 3rd party and competitors to fill the need?

[tivoupgrade]

I think the fact that only 25 people (out of almost 350 folks who have looked at this thread) indicated that they would pay ANYTHING for the lifetime subscription may be just one indication that discontinuing the option may not have been a mistake. It was just TOO good a deal for the customer because folks keep their units 2 to 3 times longer than makes sense if TiVo is going to make money.

And shortening design cycles would only increase the costs of the products themselves, as well as disgust folks who feel pressured to upgrade their own units as new products come out. TiVo's growth is dependent upon finding new customers, not just serving up new stuff to existing customers (yes, the latter is important, but its never been their highest priority)...

Personally, I value the lifetime sub (I have 5 units with lifetime subs) but as a TiVo stockholder, too - I can see why it was a bad deal for them.

Either way though - most folks don't have a lifetime sub or want one, so its really only a small number of us that really even have an opinion as it seems...

[purefct]

Your logic is flawed. First, the poll doesn't ask if you're willing to buy a lifetime subscription vs pay a monthly, it only asks how much you're willing to pay for lifetime. Second, a small percentage of respondants means very little. I'm in a beer club and when an individual sends out a poll to the group less than half respond to the poll, including polls for which date is best for our annual brewing BBQ for which more people than the poll respondants attend.

You are right of course that a lot of people will not be interested in lifetime subscriptions. My cousin decided to pay $13/mo because he didn't want to fork out $299 and four years later he's still paying. That's what? $600+ to date and counting.

That was pretty amazing you bought lifetime for your second thry fifth Tivo though. At $7/mo it takes over 3.5 years to break even, longer if the lifetime is more than $299. If Tivo was putting out new units worthy of upgrading to (people on cable have a great reason, and the S2DT is a nice touch) then people on lifetime have a reason to replace or at the very least add the new units.

I've been using Tivo for about 5 years, and bought two units. Then because Tivo didn't come out with a HD Sat DVR I went to the dark side and cancelled a Tivo since it wasn't on lifetime. I'm about to add a second HD DVR to my household. Guess what? I'm not even paying a monthly fee for DVR use! All I pay is $4.99/mo for my "additional unit" (I have 5 total units with D*V) and of course I'm paying $9.99/mo for the HD channels. If I had just the HD receiver and used Tivo that HD receiver would still cost me $4.99/mo as an additional unit. So now I'm getting HD DVR for no extra charge per month.

Back to my point though. If I was on lifetime for my two Tivos, I'd still buy a third Tivo if the product HW was an improvement over what I had. In my case that would be HD, but in other people's cases it would be S2DT, or units with DVD burners, units with 5-10 times the capacity, etc. Tivo also won't upgrade existing unit graphics, so those features (while not as strong a reason to buy an additional or replacement unit) are attractive in the new units as well. Even if you have lifetime and keep the unit, you're still going to have a reason to upgrade if Tivo improves the product. They're not improving the product fast enough nor well enough. The competition isn't as good as Tivo (although I'll take D*V HD DVR over Tivo SD anyday) but at the rate Tivo is going the competition has a lot of opportunity to be better than Tivo. Tivo's just lucky the competition is almost as slow, which I find odd given that tech electronics change and evolve monthly.

[purefct]

... And shortening design cycles would only increase the costs of the products themselves, as well as disgust folks who feel pressured to upgrade their own units as new products come out ...

I already feel that pain. I waited two years for Mitsubishi to come out with a new model for their HD 65" big screen, bought the new model with HD analogue input, only to learn they came out with a new model the very next year with DVI. I couldn't get an upconverting DVD player without DVI. Then a year after that HDMI replaced DVI and I feel bad for all the people who bought the model with DVI. But I'm not replacing my TV. I am however, adding LCD TV's with Analogue and HDMI to my household.

There is very little in the home AV market these days with a technology capable of not being improved or replaced in a short time. Using your argument as a reason to NOT bring out new products is short sided. First, there is a demand for improved products and Tivo isn't meeting that demand fast enough. Look at S3! Can you honestly say is shouldn't have come out earlier? Do you really believe before it came out that it must not have been wanted? Just because Tivo has roadblocks (either technologically, financially or legally) to bringing out new products that doesn't mean there isn't a demand for it.

[tivoupgrade]

Your logic is flawed. First, the poll doesn't ask if you're willing to buy a lifetime subscription vs pay a monthly, it only asks how much you're willing to pay for lifetime....


Well, my point there was that because there was no option for "I'm unwilling to pay for a lifetime subsciption...." that there are many folks who really had no option but not to answer. I know what you are saying as far as the whole idea of the poll being meaningless, though.


That was pretty amazing you bought lifetime for your second thry fifth Tivo though. At $7/mo it takes over 3.5 years to break even, longer if the lifetime is more than $299. If Tivo was putting out new units worthy of upgrading to (people on cable have a great reason, and the S2DT is a nice touch) then people on lifetime have a reason to replace or at the very least add the new units.

I'm not the typical TiVo customer, though; I did that for my own business, I need to have that many lifetime subbed units on hand - some of them are loaner units, and some we just keep in good standing because we need working models to test things on. So from very early on, I knew these units would be in service for a very long time; and many of them have been in service for about 4 years or so, some more...

Ironically, I think only one of the units is in perpetual use. The others are on a shelf, and for my own personal use, I use a DirecTV model which does not have a lifetime.... go figure...

:-)

[megazone]

S3 came out more than 5 years after S2,The very first S2 shipped at the end of 2001 through AT&T, the S3 shipped in September of 2006. Just under 5 years later.

But in the meantime the S2 hardware went through two revisions - 1xx to 2xx to 5xx.

The DVD-combo units were also introduced, which I consider a major change and addition to the product line, and two generations of those.

The the S2DT came out, then the S3, and now the TiVo HD.

and they aren't making a HD sat DVR because they don't want to integrate some FCC requirement in the box?I don't know what you're talking about. TiVo isn't making an HD sat DVR because they *can't*. They need access to the satellite data stream, and neither DirecTV nor Dish Network will allow 3rd parties, like TiVo, to have that access. They've pulled all receiver development 'in house' and self-brand everything. Without cooperation from the satellite companies, TiVo is locked out.

I'm talking about S1 to S2, S2 to S3, or even Tivo directly offering 500GB or 1TB units as a new model,There is no reason for them to do so, they don't sell well enough. Sure, there is enough business to keep small resellers like WeaKnees.com and DVRupgrade.com in business, but not to make it worth TiVo's while. There are many costs involved in adding SKUs to a product line. You dilute the economies of scale by buying different parts and fewer of each. Then you have to deal with managing and balancing the different SKUs in stock. If you make too many of one unit and not enough of another you end up with supply problems. All of that adds cost and complexity to the supply chain - that's why you see a number of articles about Microsoft and Sony looking to drop models of the XBox and PS3 to drop SKUs. (Special edition units, like the Halo 360, are a special case - it is a promo.)

And then you have to convince retailers to stock all of the units, or you're not going to sell some of them. And shelf space is finite - retailers don't like to stock lesser selling units.

TiVo used to offer a product spread with the S2 - 40, 80, and 140 hour units. And the larger units consistently sold poorly. Most people purchased the 'cheap' unit with the smallest drive. Cost is an over-riding factor. Retailers stopped stocking the 140-hour boxes, and they were killed off. When costs dropped the 40 hour box was killed too, and they focused on selling the 80 hour unit at a lower price.

Even now the 80-hour S2DT outsells the 180-hour S2DT. A lot of people who are looking for larger capacity will simple buy the smaller unit and expand it themselves. While the bulk of the market opts for the cheaper option.

Adding more models - with 500GB, 1TB, etc - drives would be unlikely to pay off. Remember there was a S2 with a 250GB drive the T2500 from Humax, and it was the first model they killed. People just weren't willing to pay for the larger drive - not enough to keep it viable.

Why are they leaving holes in their product line and allowing 3rd party and competitors to fill the need?Because it makes business sense. There are costs involved with everything, and resources are finite. TiVo *cannot* do everything. Companies that try to do too much spread themselves too thin and end up not doing anything well, and then they're dead. Companies are better focusing on core competencies and making a solid product, expanding the features and product line steadily and logically. If someone else pops up with a competing product to address some niche - fine, let them. Don't feel like you have to jump to answer every competitor that comes up. Be aware of them and if that market segment heats up, maybe refocus. But too often companies jump and try to counter ever new entrant, only to completely lose focus and fall.

Is there a niche for TiVos with huge drives? Yes - and WeaKnees and DVRupgrade handle that niche nicely, along with self-hackers. But that's still good for TiVo - they still sell the box and make the subscription revenue. And without the costs of building multiple SKUs. That's win-win for TiVo. It is like after-marker car parts - Dodge doesn't feel that they need to sell all of them themselves. They still make money selling the cars, and the ability to mod the car may sell more cars - and the ability to expand a TiVo may sell more TiVos.

DVD recorders didn't take off as predicted, and, on top of that, Chinese manufacturers flooded the market with dirt cheap units. It looks like the revenues just weren't there for the TiVo/DVD combo units. I own two - but I haven't burned a DVD for myself in a long time. I've only burned a couple of discs in the past six months - and those were for a friend who missed a couple of Doctor Who episodes. At the time people thought DVD combo units were the next big thing - but it didn't really gel.

Where else is TiVo really facing competition? They can't do anything in satellite without approval and cooperation from DirecTV or Dish Network. They're already working on the cable industry with Comcast and Cox, and working on more deals. They really don't have any significant competition in retail DVRs.

[tivoupgrade]

I think that was all very well put in every way and that it really does take the whole picture into account...

... the one aspect that expands a little bit of the challenge TiVo faces is that part of the threat to their existence is the requirement to continue to 'add value' in the form of differentiated products/features, and enough of it to sustain their fundamental ability to survive. And to do that in a market that is becoming heavily commoditized.

This is a very similar scenario that SGI faced back when their premium products were the only game in town and commanded a high price. They couldn't just lower their prices as their market got more and more eroded by bigger and more powerful graphics workstations in the WinTel marketplace because the underlying costs of their infrastructure, R&D, etc could not sustain themselves with lower margins.

And its my opinion that one of the reasons DirecTV and Comcast didn't license TiVo back when times got critical was because they thought they could do it cheaper, and with less frills -- serving a commodity market, instead.

I also think that the original employees of TiVo recognized this several years ago - after all, many of them were from SGI. Hopefully, with lots of new management in place, that focus has been redirected in the most beneficial ways. It seems they are doing the right things these days in terms of the relationships they have and the deals they are doing.

But going back to what MegaZone said, they have finite resources and it does take time to get a plan on track...

[purefct]

You make some valid points. But if the larger units consistently sold poorly relative to the smaller units, why doesn't Tivo sell the 40 anymore? It doesn't hold enough programming, and most people do not upgrade their units by themselves. If they do anything most buy another larger unit a few years down the road. But if people have the $100 option from Tivo for an 80 vs $280 from Weaknees for a 300, most will spend $100. Why? Beacause it's too much money. An 80GB drive is $30-100 retail and a 300GB drive is $100 retail. Tivo could offer a 300hr for $150 and still make more than the they do on the 80 hr unit. Instead they (I'm thinking of vendors who've offered larger HD options, not just Weakness) mark the unit up an extra $100 or more, pricing the product out of the mainstream market.

OK, a first time buyer is more likely to buy the chepo unit. They won't understand how much they are likely to store until after they start using their unit. But most of them will never mod their units. They are more likely to add or replace units and they'll only do it if the units are affordable. I don't consider Weaknees affordable; they are merely available to people with money who don't want to get too technical.

[tivoupgrade]

You make some valid points. But if the larger units consistently sold poorly relative to the smaller units, why doesn't Tivo sell the 40 anymore?

Because the cost of offering an 80GB unit has dropped sufficiently enough to get the acquisition cost low enough to be affordable to the folks they are Marketing to; I don't think a 40GB unit could be offered much cheaper than an 80GB unit these days - not even sure if 40GB drives are manufactured anymore (even 80GB drives are getting harder to find...)

Again, TiVo's primary strategy has been to make money on their service offering, not on selling hardware. That may be changing over time (ie they now sell accessories and make money on them), however for them to really grow and prosper, they need to increase the number of subscribers by lowering the costs of hardware to accessible price-points.

Perhaps their is an opportunity for TiVo to "upsize" their product offerings, however the resources would have to come from somewhere and at the expense of focus on something else....

I can't tell you everything I know, but lets just say, they are no strangers to the concept and are most likely focusing on the right things...

[megazone]

Because the cost of offering an 80GB unit has dropped sufficiently enough to get the acquisition cost low enough to be affordable to the folks they are Marketing to; I don't think a 40GB unit could be offered much cheaper than an 80GB unit these days - not even sure if 40GB drives are manufactured anymore (even 80GB drives are getting harder to find...)Exactly, the price curve is fairly flat at the bottom end - and it is always sliding to the right on capacity. Over time a 80GB drive ends up costing about the same as a 40GB drive in quantity, so there is no advantage to continuing to use 40GB drives. That's why even budget PCs tend to have larger drives than just a year ago - for the same money the vendor can use a larger drive and remain competitive. There are fixed costs with the drives, so small drives never drop below a certain point - they just get phased out of production as larger drives come down to that flat part of the curve.

Sometimes the larger drives end up costing *less* than the older, smaller drives because of advances in technology and reduced costs of newer components.

[NerdXing]

I was looking for another tivo until I found out Lifetime is gone. Now I have a Media Center PC instead. Won't record some cable channels due to blocked content so I use my tivo for those channels. Sorry tivo, you lost a sale.

[reflxshn]

The issue is recurring revenue; it looks good on the books. A lifetime liability is the opposite (like a credit card you'll never pay off).

One answer could be LT at a certain software level- If you want MRV or TTG or some other new feature, you'll need to keep a maintenance contract current. This is standard practice in the software industry. It changes things a bit for Tivo customers, but really works for both Tivo and the customer. For the customer it provides and option. If you like what you have you can stay there at no ongoing cost. If you want the new stuff you pay a % annually to always have access to it. In the software industry this ranges from 10 - 25% and it is based on sw lifecycle. For Tivo it provide the funding and incentive to keep development going. If they keep new better features coming, people will keep renewing. So here's an example:

Cost of LT (typically 1 year of maintenance is included with most software)
299

At the end of the first year you have a choice- stay where you are or renew. If Tivo keeps the updates coming, then people will be glad to renew.
So form then on there's a say 15% renewal to keep current = $45 annually

At the end of 3 years you are out a total 389 (Tivo makes an extra 90$ towards development of new features- over their current 3 year up front offer)
But you would only pay that extra $90 if you felt the upcoming features were worth it. This would also seem to encourage Tivo to promote their upcoming feature a little more.

They could also allow transfer of service only if maintenance was current.

Just an idea-

[purefct]

The fallacy with software subsription or licensing is the vendor spends very little time improving the product you are using and instead uses more of the funds for new development you have to pay extra for. Granted, Tivo does provide some interesting enhancements for the subscription. But to get better graphics on your screen, or a border which is less likely to cause screen burn-in on your (my) HD big screen TV you must buy a new unit. That's not neccessary! These improvements should be provided as a part of the subscription. When S2 came out, all the S1 owners were left out of the home media option. Maybe I don't remember correctly, but if an S1 can connect to the internet for content updates then it can be used for HMO.

[Narf54321]

The issue is recurring revenue; it looks good on the books. A lifetime liability is the opposite (like a credit card you'll never pay off).

But Tivo is not taking into account the hidden costs of not selling Lifetime subscriptions. In years past, I would talk to friends and co-workers about Tivo and while they didn't care for the recurring monthly bill I could always point to the Lifetime offer as a backup plan. Usually when they went with a Tivo, they ended up going monthly anyways. Simply the offer of Lifetime was a good security blanket.

However, without Lifetime available and combined with the crazy cell-phone-like lock-in plans I can no longer recommend Tivo to anybody. And I've read here and other forums plenty of other Tivo fans who similarly gave up recommending Tivo. Now they're reporting losses of subscribers. Little wonder.

If you were a shareholder, you should be demanding Tivo bring back Lifetime subs.

[purefct]

Thank God, someone I can agree with! I've been alone in my opinions for so long!

[megazone]

Maybe I don't remember correctly, but if an S1 can connect to the internet for content updates then it can be used for HMO.The S1 has no network or USB ports, only a modem. The only way to get one on a network is to hardware hack it and add a 3rd party card - which TiVo is never going to officially endorse or support. The S1's hardware platform is MUCH weaker than even the earliest S2 - only a 54MHz PPC with 16MB RAM, the first S2 has 166MHz MIPS and 32MB RAM. And there is the issue of the CPU architecture changing (Power to MIPS), along with pretty much all the HW. Continuing to support the S1 just wasn't effective since the platform was inferior, not to mention it was a small market and would require dedicated resources.

While the S2 family has changed, there is still commonality in the architecture and even the earliest 1xx S2 boxes from 2001 continue to receive updates today. Modulo the hardware capabilities, they have all the same features as the latest TiVo HD.