Tivo Case Study

Tivo is a digital recorder that helps viewers to take control of what they watch. The

features of Tivo are recording programs as per viewers’ request, suggesting the

programs according to viewers’ habits, ability to skip commercials, and so on.

The TiVo service provides consumers with a variety of specific features. There are

many factors that could facilitate its features:

a. Recording the programs – easy to record, stop, rewind, and schedule recording the

shows.

Despite the apparent strengths TiVo incorporates, there are many factors that make its

adoption difficult. Firstly, the consumer has a great disparity in defining and viewing

TiVo. The degree of awareness for TiVo remained weak and consumer remained inert

because it is not their priority to improve TV viewing. After fourteen months into the

launch, TiVo had only signed up 42,000 subscribers, with a current rate of 14,000 new

subscribers per quarter. With 102 million TV-watching households in the US, that was

only about 0.04% penetration. Therefore, from the data we could see that TiVo has not

caught up a substantial awareness of the consumers. Secondly, the price seemed too

high to be accepted by customers. The TiVo black box was priced $499 for a model

with up to 14 hours of recording capacity and $999 for a model with up to 30 hours.

The price was more expensive than most TV sets and more than twice the price of a

good satellite system. Thirdly, Salesmen in distributors turned over fast which made it

hard to train them explaining to customers properly. In addition, there were various

ways for salesmen to sell TiVo.

TiVo users primarily consist of young professionals, between the ages of 23 and 45, and

had middle average annual income. In this regard, members with this kind of features

are best suited for TiVo. We can also imply that people