Fall 2006 Pricing Changes - FAQ

[bicker]

I see the problem, but what I see is that the problem is your unfounded expectations that consumers should have control over a supplier. In the mass market, the supplier offers, and the consumer chooses between accept and reject -- the consumer doesn't get to dictate terms that the supplier should be offering.

[c3]

Originally Posted by Gai-jin

Thus far, it seems you're the only one who doesn't see that the new plan sucks, and that it's treating existing TiVo owners poorly.

No, bicker is not the only one. I don't really have problem with the new pricing structure, other than that an unsubsidized unit should have lower monthly rate or shorter contract.

[Gai-jin]

Originally Posted by c3

No, bicker is not the only one. I don't really have problem with the new pricing structure, other than that an unsubsidized unit should have lower monthly rate or shorter contract.

I don't have a problem... other than...

That would indicate a problem.

That is the same problem I have. I don't like the new pricing any which way, but ripping off customers who have already 'paid their dues' so to speak is what I find truly outrageous.

[Gai-jin]

Originally Posted by bicker

I see the problem, but what I see is that the problem is your unfounded expectations that consumers should have control over a supplier. In the mass market, the supplier offers, and the consumer chooses between accept and reject -- the consumer doesn't get to dictate terms that the supplier should be offering.

Sure they do. They don't buy when a supplier screws up. The supplier changes, or ends up going bankrupt.

Ideally, there will be enough continued backlash and lost subs as a result of this error that tivo will change.

[c3]

Originally Posted by Gai-jin

I don't have a problem... other than...

That would indicate a problem.

Yes, but not nearly the same as you.

Actually, there was no pricing break before the latest change, either. I could get a 540 box for free after rebate, or sign up with a used box. Same $12.95/$6.95 rate with 1-year contract. It's just now that those rates are available only with 3-year contract.

[bicker]

Originally Posted by c3

No, bicker is not the only one. I don't really have problem with the new pricing structure, other than that an unsubsidized unit should have lower monthly rate or shorter contract.

And I haven't said whether I have a problem with the new pricing structure or not. Rather, I've made it clear that whether any one person likes the pricing structure or not has no bearing on whether it is "right" or "fair" or "legit" or "a good idea" etc.

[bicker]

Originally Posted by Gai-jin

Sure they do. They don't buy when a supplier screws up. The supplier changes, or ends up going bankrupt.

And that's the appropriate mechanism: If you don't like what's offered, don't buy it. That's your vote.

[ChuckyBox]

Originally Posted by Tiggerdrh

Ya know, on my account page it says I'm a "monthly" customer, I wonder if they are opening themselves up for a class-action lawsuit from customers like me?

No, they're not. TiVo can charge whatever they want for their service. If you don't like it, too bad. The company doesn't owe you anything and you are free to take your business elsewhere.

[Tiggerdrh]

Well, I suppose you're right the company doesn't owe me anything, but hey guess what, they've already lost 3 subscriptions from friends of mine who were considering purchasing their systems. Once I explained the new pricing and the semantics they played with my account they were done and wanted no parts of this company. Plus, I've got a whole lot more people to talk to between now and Christmas who were asking me about TiVo. So who's the winner and who's the loser when you treat current customers unfairly?

[ChuckyBox]

Originally Posted by Gai-jin

Tivo screwed up on this one, and I'm just trying to help them see it.

Sorry if I make any mistakes typing, it's hard to see my monitor through my tears of contrition. How could I have been so wrong about Gai-jin? Here I'd been thinking that he was just having an infantile tantrum about being charged a couple of bucks more per month. But now I find I was totally mistaken -- he's been here selflessly giving his time and energy to this one-man crusade in TiVo's best interest, with nary a thought for himself. I feel so ashamed.

Sniff.

[kido]

Originally Posted by Tiggerdrh

So who's the winner and who's the loser when you treat current customers unfairly?

it would seem you are the loser.

[ChuckyBox]

Originally Posted by Tiggerdrh

So who's the winner and who's the loser when you treat current customers unfairly?

I think we'd carry this thread too far astray if we were to engage in even a short discussion of companies that have been quite successful despite (or maybe because of) constantly screwing their customers. But the short answer to your question is that the company usually wins and the customers usually lose.

But what I don't understand about you is why you are borrowing all of this trouble? You've said that you are on a monthly plan, and that commitment runs through February. And yet you're calling CS now, waiting on hold multiple times, posting to the forum and emailing Pony, all in an effort to get TiVo to commit to a level of pricing that you will probably get just by doing nothing. This pricing plan is a couple of weeks old, there are unresolved issues with it, and the CS drones have no knowledge of nor power over what pricing policy will be in effect three months from now, and they literally can't change your plan until your current commitment is up.

Don't get me wrong, if you want to discuss this for purely academic reasons, I'm here for you. But if you are really putting this much energy into what at worst will be a few bucks a month (assuming it ever comes to pass), I just don't understand it. Why don't you wait for something to actually happen, and then get worked up about it?

[Gai-jin]

Originally Posted by bicker

And that's the appropriate mechanism: If you don't like what's offered, don't buy it. That's your vote.

That, and continued vocal opposition to the new plans.

[Tiggerdrh]

Chucky,

The reason I got worked up in first place was that I was considering getting a second box. I called to see about my plan and when it expired and that's when I was informed by CS drones about the new plan. I was also told I'd be paying $20 a month for my current box under this new plan. I called again to get furthur confirmation and got the same story. So, I came to the forum, read the the FAQ and I posted to the forum because what they told me didn't jive with what Pony posted. Someone suggested I call again to get a case#, I did so and was given the same story with the explanation of why I didn't qualify for the reduced rate. I was also told that it's on my file that if I have any questions to please review the FAQ on the website. What kind of response is that? I was and still am extremely confused about their reasoning. I'm really just trying to get clarification. You're right they can't do anything anyway until my contract expires.

As for as the lost subs, I was at a dinner party last night and the subject of TiVo came up because someone was really interested in getting a DVR. When I explained what was going on with CS and what I had been told, my friends were kind of shocked. So, yes the new rate doesn't apply to me now, and I don't normally borrow trouble, but it "would" apply to my friends who were considering purchasing this thing and at this point I can't recommend the service. I also don't understand why TiVo would do this right around the holiday season. It makes no sense to me. So I guess maybe you and anyone else can consider "me" a loser but hey that's fine, we're all entitled to our opinions. And you're right, I've spent too much energy on this when it doesn't matter right now but this whole process doesn't sit right with me.

[c3]

Tiggerdrh, even before the latest price changes, you would NOT get $12.95/month without changing service plan. If you don't do anything at the end of the year, your monthly rate will be the 1-year package rate.

[Tiggerdrh]

C3,

That's why I called in the first place. I wanted to know when my current plan expired and what it would be if I renewed. I had always planned on buying another year, and I was really planning on upgrading to lifetime. LOL. I didn't realize how behind I was on that one. I also originally wanted another box and didn't get that far when the new pricing was explained. She told me I was on month to month and that the new month to month was $20, that's when I freaked and started to research the new policy.

[ChuckyBox]

Originally Posted by Tiggerdrh

So, yes the new rate doesn't apply to me now, and I don't normally borrow trouble, but it "would" apply to my friends who were considering purchasing this thing and at this point I can't recommend the service.

I don't see how your situation affects your friends. You have multiple TiVos, some under MSD, another under a package of unclear terms. Your friends' situation is that they don't have TiVo and if they want it, the terms are very clear. If you can't recommend those terms, fine, but it sounds like you are not recommending them because of some confusion about what you might be paying three months from now under various scenarios, which doesn't make a lot of sense to me.

I also don't understand why TiVo would do this right around the holiday season. It makes no sense to me.

They are doing it to sell their product. The company found that the old terms were an actual impediment to getting people to try TiVo. So they spent the last year putting together a pricing plan that is more like the cell phone model where the hardware is free (or upgraded hardware can be had for a one-time upfront fee), and the customer commits to a service plan for some period of time. (These plans worked for the cell phone companies -- their growth exploded when they were able to start giving phones away.)

These pricing plans aren't in place to piss off current customers, they are there in an attempt to stimulate sales for a company that has endured years of underwhelming growth. As Pony has said, the intent is to leave current customers' hardware unaffected by the new pricing.

[RoyK]

Originally Posted by ChuckyBox

These pricing plans aren't in place to piss off current customers, they are there in an attempt to stimulate sales for a company that has endured years of underwhelming growth.

Maybe so but it seems that they are doing the first and, if the reactions of several of my friends and neighbors is any indication don't stand much of a chance of doing the second.

[Tiggerdrh]

Tivo's aren't cellphones. I feel that most people feel they need cellphones, they don't need DVR's. Maybe I'm the only person in this forum who thinks that $17 a month with a one year contract for something that I "own" that is a "supplement" to cable is a bit high. I am a current customer and if the intent is to leave my hardware at the current prices, then something is very wrong with the delivery of the message, because that's not what "I" was told in my particular case.

The point I was trying to make is that yes, the new terms are very clear and once I explained the new terms, my friends thought that was too much money to spend when they can get a DVR through our cable company for much less. That plus my experience with CS was the icing on the cake.

Anyway, we can debate this until the end of time, it doesn't really matter does it? Only time will tell if TiVo's new pricing plan will work for them.

[c3]

Originally Posted by Tiggerdrh

The point I was trying to make is that yes, the new terms are very clear and once I explained the new terms, my friends thought that was too much money to spend when they can get a DVR through our cable company for much less.

TiVo does not have the luxury of charging you a lot of money for the content. In my area, I cannot get a Comcast DVR without paying them $70/month, instead of the $16.50 which I'm paying now. In my situation, even spending $700 for the S3 hardware makes a lot of sense.

[ChuckyBox]

Originally Posted by RoyK

Maybe so but it seems that they are doing the first and, if the reactions of several of my friends and neighbors is any indication don't stand much of a chance of doing the second.

And those samples amount to what? A few people on this forum complained about it for a few days in what can only be described as a collective yawn by the standards of this crowd. And your friends and neighbors? Let me guess, they were all considering TiVo but when this new pricing that makes it cheaper for them to get a TiVo was announced, they all changed their minds. Right?

Damn that $220 rebate, it's driving customers away in droves.

[ChuckyBox]

Originally Posted by Tiggerdrh

Anyway, we can debate this until the end of time, it doesn't really matter does it? Only time will tell if TiVo's new pricing plan will work for them.

And yet you keep posting arguments as to why it won't work.

[dswallow]

The new pricing scheme may be great for people with no up-front money. But it's just the opposite for people looking to give a gift. All it does is exacerbate the problem of giving a gift that the recipient has to pay to use. That it's now more complicated, more expensive, and requires making a commitment is just one more reason to give someone pause who's considering giving the gift of TiVo.

There's no easy answer. But over the years TiVo's not really making a lot of progress with the ideas they've chosen to implement, have they?

[samo]

Originally Posted by dswallow

The new pricing scheme may be great for people with no up-front money. But it's just the opposite for people looking to give a gift. All it does is exacerbate the problem of giving a gift that the recipient has to pay to use. That it's now more complicated, more expensive, and requires making a commitment is just one more reason to give someone pause who's considering giving the gift of TiVo.

There's no easy answer. But over the years TiVo's not really making a lot of progress with the ideas they've chosen to implement, have they?

Lets try to recollect.
1. Series 1. Started at $500 + $9.95 /month. Shortly after to compete with Replay $200 lifetime is introduced. Not much in sales department.
2. $100+ mil for name recognition advertisement blitz. TiVo becames a verb but no sales to speak off. Price dropped to about $300, still not much of the sales.
3. Series 2 introduced. Magic mark of $200 is achieved (everybody is convinced that this is a price that people will pay). Still not good enough.
4. Limited trial with Cox. $19.95 a /month - no upfront fees. Never went anywhere.
5. At&T cable deal. $200 upfront + monthly. No dice.
6. Somewhere along a line price of the sub is bumped to $12.95 and lifetime is bumped to $250 then $300. No profits yet.
7. Brilliant idea to reduce churn - 1 year contract. Sales dropped even with near free hardware. Who cares, TiVo sill losing money.
8. Latest and greatest - free TiVo with $19.95/month (wasn't it tried before? I guess it wasn't conclusive trial). It has to work now, because what else can be done? Lifetime units for $600-700? Sorry, doesn't work either.
Guess what? Even a new price structure is not profitable. Bundled price makes it just about break-even. TiVo actually loses money if they sell you TiVo for $199 with 1 year bundle and you do not re-sub. It is a catch 22 situation. They can't charge you more and they can't charge you less. TiVo tried really hard to become software only company - didn't work. They are back in a hardware business with S3 that is profitable (nice change, back to 1999 when series 1 was profitable but didn't sell).
Doug is right there are no easy answers. If my memory failed me and I made some mistakes in chronology feel free to correct me (I'm not about to make research paper out of it, so everything I wrote is based on my recollection of events). Bottom line still doesn't change - everything TiVo tried so far didn't work.
Lets hope that the latest change is little more than another attempt to hype up quarterly report.

[tbeckner]

Originally Posted by ChuckyBox

And those samples amount to what? A few people on this forum complained about it for a few days in what can only be described as a collective yawn by the standards of this crowd. And your friends and neighbors? Let me guess, they were all considering TiVo but when this new pricing that makes it cheaper for them to get a TiVo was announced, they all changed their minds. Right?

Damn that $220 rebate, it's driving customers away in droves.

IMHO, what is driving people away in droves is the $19.95 per month with a one year commitment.

And really who cares about rebates; I am one of many who quit buying items because they have rebates. In fact, most of the large retailers already have plans to eliminate rebates from their pricing, like Best Buy.

[bicker]

Originally Posted by Tiggerdrh

So who's the winner and who's the loser when you treat current customers unfairly?

You're assuming facts not in evidence. Just because you don't like the pricing changes doesn't make them "unfair". There will always be some customers who will have and hold bad feelings about pricing, but professionals manage their companies affording only appropriate consideration of such outliers (i.e., very little consideration), and instead focus on the purchasing behaviors of the vast majority of their targeted customer base. Without access to the reconaissance that TiVo used to base its pricing decisions, all of us here are at a distinct disadvantage with regard to evaluating the new pricing: TiVo knows what they know, and we feel what we feel -- we only think we know what we think we know.

So given the choice between believing that a company made the best decision for the company based on applying professionalism, expertise and market data, versus believing that they didn't based on the gut feel and emotional reactions of some folks on a discussion board -- gosh -- that's not really a hard choice. Figure that the pricing changes, unless precipitated more by the imminent catastrophic failure of the company (i.e., a "last ditch effort"), most likely are based on a sound understanding of how customers in general will view the pricing changes, and rest assured therefore that customers in general view the pricing changes as fair and reflective of the value provided by the service. While each of us will make that evaluation for ourselves, what matters to the business is how customers in general will make that evaluation.

[bicker]

Originally Posted by Gai-jin

That, and continued vocal opposition to the new plans.

To which you'll receive continued rebuttal.

[bicker]

Originally Posted by Tiggerdrh

Tivo's aren't cellphones. I feel that most people feel they need cellphones, they don't need DVR's.

Hmmm.... hard choice. I think, at this point, I'd sooner live without my cell phone than without my DVR. I use my DVR every day, and use my cell phone maybe once a week.

Anyway, we can debate this until the end of time, it doesn't really matter does it? Only time will tell if TiVo's new pricing plan will work for them.

Indeed. Efforts to distort the reality are really quite silly. It is what it is, and its effectiveness will become apparent over time.

[bicker]

Originally Posted by dswallow

There's no easy answer. But over the years TiVo's not really making a lot of progress with the ideas they've chosen to implement, have they?

It's not clear, even, that there is a profitable way to sell DVRs as consumer electronics. There are more brands that have discontinued making DVRs for sale to the American public directly than there are brands currently doing so.

[DCIFRTHS]

Originally Posted by bicker

It's not clear, even, that there is a profitable way to sell DVRs as consumer electronics. There are more brands that have discontinued making DVRs for sale to the American public directly than there are brands currently doing so.

...but none of them were TiVos