Tivo Free Again And This Time It May Be Permanent
With the ever increasing competition from Cable Company DVR units, which have no upfront costs for the consumer, Tivo is considering offering it’s DVR boxes for free but with a higher charge for the monthly service. According to Tivo CEO Tom Rogers, the company will soon be offering a range of pricing options, including plans with no upfront costs (free!) and one with all upfront costs — no monthly service charge!
Tivo has tried offering free DVRs before for a limited period of time. During the 2005 holiday season, 40 hour units were available for free but you had to sign up for a plan with a higher monthly charge — $16.95 per month versus the usual $13 per month when you buy the unit. I’m assuming that since they are considering offering this option on a permanent basis, it must have been successful when they offered it last year.
To be successful, Tivo needs to increase their subscriber base, which is currently approximately 4 million subscribers. While offering the Tivo units for free will definitely help them compete with Cable companies that do not charge for their DVR’s (they only charge for the monthly service), I’m not sure that this is a good long term solution for them. If they have to charge a higher price for the monthly service fee than the cable companies, the customers they are trying to get by offering the free Tivos will probably still go to the cable companies. Tivo may be better, but the cable set top boxes are catching up and their is nothing to buy and the monthly charge is less! If Tivo is going to succeed, they need to concentrate on making people believe that a Tivo is better. Otherwise, they will all just be generic DVRs and the cheapest box will win!
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ReplayTVBlog.com » TiVo Ends Lifetime Subscription With New Pricing Model said
am March 8 2006 @ 10:41 pm
[…] As reported last month, TiVo has announced a new pricing plan for their DVR units. Under the new plan, there will no longer be a lifetime subscription fee available. But, buyers will not have to buy a TiVo anymore - they only have to sign up for an annual contract and pay a monthly fee. TiVo contracts will be available in lengths of one, two, or three years with the monthly fee being $19.95 a month for a one year contract, $18.95 a month for a two year contract, and $16.95 a month for a three year contract. Initially, the new pricing plans will be available only to customers who sign up on TiVo.com with retail store customers still getting the old pricing. Eventually, TiVo plans to also change retail stores over to the new plans. […]