TiVo Forum Special Member
Registered: Dec 2001
Location: Morgan Hill, CA
TIVO Story in San Jose Mercury News
Posted on Thu, Jun. 13, 2002
TiVo generation takes control of viewing
By Sam Diaz
There's this cartoon -- ``The Proud Family'' -- that my kids really like. OK, I like it too. It comes on the Disney Channel, I think, on Friday. Or is it Saturday? Maybe it is Friday. I'm not too sure but it doesn't really matter. In our house, ``The Proud Family'' is on every day.
Ours is a TiVo house and my kids -- Alexandria, 6, and Zachary, 4 -- are TiVo kids. And that means that they (and I) can sit down whenever we want -- maybe before bedtime on a Tuesday evening -- and watch an episode of ``The Proud Family.'' Or ``The Brothers Garcia'' or ``Kim Possible.''
In our house, two of the founding members of the TiVo generation are growing up to realize that they control the schedule of their favorite shows -- not the network.
TiVo is becoming synonymous with the digital video recorder, a VCR-like device that records TV shows to an internal hard drive instead of a removable tape. Like competitors ReplayTV and UltimateTV, TiVo offers a user interface on top of the basic DVR technology that allows users to record a program based on its name, rather than its time slot.
It doesn't matter when something is on. Users can set up a favorites list and tell the DVR to record, for example, ``Friends'' whenever it appears on NBC. (It won't record the syndicated reruns on other channels unless you ask it to.)
Of course, that's something a VCR is capable of doing -- unless ``Friends'' happens to be a special one-hour show or maybe airs on a Tuesday instead. Your VCR won't know about the change but TiVo will.
And as ground-breaking as that feature is, it's not what consumers seem to be most impressed by. Pausing live TV amazes folks when they see a DVR in action.
TiVo and the others, including the companies that manufacture the boxes, tried to build on the pause-live-TV feature as a selling point. Philips put out a commercial showing a guy nervously watching a football game. When it comes time for the game-winning kick, the viewer pauses the TV, drives to church, says a prayer. When he gets home, he hits play and sees his team win the game.
Consumers didn't bite.
There are fewer than 1 million digital video recorders in households today -- and of those, only about 400,000 run the TiVo service. The remainder is split among Microsoft's Ultimate TV, SonicBlue's ReplayTV and a generic DVR built into high-end receivers used by Dish Network satellite subscribers.
Price an obstacle
Price has been a big major stumbling block for consumer adoption of DVRs, which retail for about $400. And the understanding (or lack) of how they work has also been a deterrent. Who's going to pay $400 for some sort of video unit that's hard to understand?
Kids like Alex and Zack don't need to understand how it works. They just know that their shows are on when they want to see them. And that means the kids can come home and do their homework, play on the swings or ride their bikes without having to worry that they'll miss their favorite shows.
``There is a youth element to TiVo,'' said Mike Ramsay, CEO of the San Jose-based company. ``Kids' programming is the largest segment of programming being recorded.''
Ramsay realized early that it would be tough to explain the features of TiVo to the masses. Not only was TiVo creating a unique service, they also had to come up with a platform to use that service.
``America Online was a service that had a platform already, in the form or a PC or a Mac,'' Ramsay said. ``We had to create that platform too.''
And they needed to build their brand name. So they started giving it away to people who might have some influence on consumers: celebrities.
``You'd be amazed with the amount of times that TiVo is mentioned on TV,'' said Josh Bernoff, a principal analyst who covers the DVR revolution for Forrester Research in Cambridge, Mass.
It's been mentioned -- and spotted -- on ``Friends.'' And on the TiVo Web site, you'll read testimonials from celebrity musicians, actors and athletes on how TiVo has changed their lives.
A survey by TiVo found that 96 percent of subscribers would never give up their TiVo service. About 40 percent of the respondents said they'd rather give up their cell phones than their TiVo units.
``That's a fairly typical response,'' Bernoff said. ``People are in love with this product and they are not going to give it up. The churn rate for TiVo is tiny.''
But penetration into homes remains a challenge. Existing subscribers have a tough time explaining it to their friends -- so instead they offer demonstrations.
Steve Karp, a small-business owner in San Mateo County, said he not only bought two for his home -- where a wife and three kids with different viewing habits made for some battles over the remote control -- but also bought a unit for his father and brother's family.
His dad initially didn't want it, figuring it would be too complex to figure out, he said.
``I knew how easy it was so I just did it for him,'' he said. ``Now he can't live without it. He loves it and is totally devoted.''
The same goes for Janet Lam's family in Mountain View. Her father bought a TiVo unit first and then her brother. When they saw it in action, they had to have one, as well.
``I don't know if it's changed our lives but it has made it easier for us to be in control of the TV rather than the TV to be in control of us,'' she said.
If the price were to come down, TiVo could be well on its way to becoming more than a household name. It could become a mainstream household product.
During last year's holiday season, TiVo registered 100,000 new subscribers when Internet promotions dropped the prices of DirecTV/TiVo units under the $100 mark -- and in some instances under the $50 price tag.
Spreading the word
My wife and I did our part to spread the word, too.
My dad was quickly impressed with the TiVo service at our house and hinted that TiVo was what he wanted to unwrap on Christmas morning. My mom took advantage of the holiday promotion and ordered one.
My dad has since taught himself how to extend the recording time in case the Lakers game goes into overtime. My mom has figured out how to set up the daily recording of ``All My Children.''
At first, they had a tough time understanding how to work the remote control. But that was easily fixed. We brought Alex and Zack to their house.
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