TiVo Case Analysis: Highs and Lows

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TiVo Case Analysis
Since day one TiVo has been the leader in the DVR (digital video recorder) industry with their first mover advantage, allowing their customers to record and play back their favorite television programs using their recorder along with a subscription service. Like any successful firm, TiVo has had its share of highs and lows. In 2007, with their CEO Tom Rogers, TiVo had found itself recovering from an all time low in 2005, where the company suffered from mass losses, low stock prices, and the end of an important partnership with DirecTV. TiVo was now headed down the right path, once again being first movers by differentiating their product and services around new “macro trends” into a viewing and advertising solution for a la carte on demand television, as opposed to just a high quality DVR. Although TiVo has the right idea, their key challenge is how to remain successful and leaders of their industry while balancing and pursuing new opportunities in these multiple businesses (Cable/satellite, software development, intellectual property licensing, advertising solutions, audience research, and international business) all while still trying to become more profitable. In order for TiVo to successfully enter these new businesses while increasing profits, they need to concentrate on areas that will benefit them the most and by trying to increase stand-alone sales. By late 2007 TiVo had mass distribution deals with Comcast, Cox Communications, and once again with DirecTV, giving TiVo a much larger distribution channel than ever before. Even though TiVo’s profits from mass distribution are close to none in comparison to what they could make from stand-alone customers, they have a great opportunity to use these distribution channels to make more profits by concentrating on advertising solutions and audience research. TiVo’s current advertising business was small; with only about half a dozen salespeople bringing in less than $25 million...
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