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TIVO article on ZDTV web site
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Posted by: Edward

Ran into this story on TIVO called "Tivo thrives in Tough Times"

Interesting how their subscriber base is growing, but they don't predict a profit for quite sometime. Seems like a
similar business plan as the videogame console makers.
Unfortunately you sell the shavers and have to patiently wait for YEARS while people buy blades....
http://www.techtv.com/money/busines...3329101,00.html

Posted by: AndyK

The subscriber numbers should be interesting! I've noticed a large number of newbies around here lately, hopefully a good sign!

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I am an army of 2.0.1

PEOPLE SUCK

Posted by: Percipient

The article says that analysts are estimating quarterly revenues of around $2.3 million, and that seems too small for the subscriber base.

If TiVo had only 154,000 subscribers during all of Q1 (they had at least that many) then at $10/month per subscriber (I'm assuming they declare only part of a lifetime subscription each quarter, amortizing it out over two years) that's $1.54 million in revenue per month for a total of $4.62 million.

While only an estimate, given that TiVo revenue comes from only one source it should be pretty close to the mark. Anyone know why the factor of two difference?

--Percy

Posted by: bgreen5

quote:
Originally posted by Percipient:
...given that TiVo revenue comes from only one source ...
--Percy

TiVo's revenue comes from more than one source. For one, advertising partnership revenues are beginning to trickle in.

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Posted by: nextguard2

quote:
Originally posted by Percipient:
The article says that analysts are estimating quarterly revenues of around $2.3 million, and that seems too small for the subscriber base.

If TiVo had only 154,000 subscribers during all of Q1 (they had at least that many) then at $10/month per subscriber (I'm assuming they declare only part of a lifetime subscription each quarter, amortizing it out over two years) that's $1.54 million in revenue per month for a total of $4.62 million.

While only an estimate, given that TiVo revenue comes from only one source it should be pretty close to the mark. Anyone know why the factor of two difference?

--Percy

One possibility is that "subscribers" includes lifetime subscriptions that produce onetime fees not monthly ones.

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NextGuard = Paul from Atlanta

Posted by: Percipient

quote:
Originally posted by bgreen5:
TiVo's revenue comes from more than one source. For one, advertising partnership revenues are beginning to trickle in.

But that makes the disparity even worse.

quote:
Originally posted by nextguard2:
One possibility is that "subscribers" includes lifetime subscriptions that produce onetime fees not monthly ones.

There are two ways they can post revenues from lifetime subscriptions. They can post them fully in the quarter they are paid, or they can amortize them over some time period.

We know they can't be posting them in the quarter they are paid, because then the revenues would be far higher. For example, if 50% of TiVo purchasers choose lifetime subscriptions, then in Q1 of this year there would be $2.5 million in revenue just from the 25,000 new subscribers alone. If 50% of current subscribers pay monthly, then the 175,000 of them would be an additional $2.625 million for the quarter, bringing the total to $5.125 million, even higher than my original estimate.

They also can't be spreading out declaration of the lifetime subscription revenue over a relatively short period, such as two years, since $200-250 over 24/months is just about the same as the monthly fee, and that was my how I arrived at my original estimate of $4.62 million.

So perhaps they are amortizing lifetime subscriptions over a really long period of time, like 10 years. This yields negligible revenue per quarter, less than $0.1 million for Q1, and with monthly subscription revenue at $2.625 million that brings the total pretty close to estimates, so this might be what they're doing.

The deferral of revenue and the huge losses probably make TiVo an extremely attractive acquisition target to any company which believes the product category has a future.

--Percy

[This message has been edited by Percipient (edited 05-24-2001).]

Posted by: bgreen5

quote:
Originally posted by Percipient:

So perhaps they are amortizing lifetime subscriptions over a really long period of time, like 10 years.
...
The deferral of revenue and the huge losses probably make TiVo an extremely attractive acquisition target to any company which believes the product category has a future.

--Percy

[This message has been edited by Percipient (edited 05-24-2001).]

The amortization period is 4 years. The mix of lifetime/monthly subs is roughly 65%/35% for now.

TiVo should bean extremely attractive acquisition target... but if I say anymore, this might be construed as stock talk (which is banned). http://www.avsforum.com/ubb/wink.gif

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