I have written elsewhere (Leading with Vision: The Design of New Ventures) about the challenges for TiVo in today’s networked world. This morning TiVo and Yahoo announced what I sincerely hope to be a new strategic direction for the company:
TiVo Inc. and Yahoo Inc. said on Monday launched a collaborative service that allows TiVo users to program their digital video recorders remotely using Yahoo’s television information Web sites. Shares of TiVo rose 13 percent on the Inet trading system, as the deal appeared to help the company find new ways to compete with cable and satellite companied that offer their own video recording services. In the coming months, TiVo and Yahoo will also offer Yahoo services like photos, traffic, and weather available as part of the TiVo service
There may be hope yet for us TiVo fanatics, as the company struggles to move from being a box to being an enabling node in a larger network that its competitors, the Cable and Satellite providers, cannot or will not create.
In a world where anyone could design and source a digital video recorder (e.g., the HargaDVR) within a few months, TiVo has little advantage to offer as a stand-alone box. If you say superior user-interface, it’s the same as saying Charmin will hold its own in Walmart because of its superior user interface. That’s a nice thought, but when it’s sitting on the shelf next to a Walmart private label tissue selling for 25-50% less and you can’t (or won’t) experience the difference before buying, user interface is a hard sell.
Instead, TiVo’s biggest advantage lies in connecting the user to worlds beyond what the Cable and Satellite providers bring–making TiVo a valuable addition rather than interloper to the existing field surrounding the production and consumption of television content. If TiVo brings Yahoo into the television field, it brings a set of product features and user experiences that the CableCos could not. For example, Yahoo brings a TiVo-enabled network the ability to record programs from the ‘net whenever and wherever they think of it (TiVo2 could already do that, but not without visiting the TiVo site). With all of Yahoo’s content, that could be enormous. Yahoo already provides programming schedules. They could also provide long-tail recommendations for TiVo users that include more information about what and why, and integrate digital content along the way. And any ads Yahoo sells to the networks could carry its own “record this show,” getting rid of the need for viewers to actually remember to watch something. That’s just the beginning, or course, but a great leap forward for them.
In classes and executive ed, I have used the TiVo case extensively as an exercise to get people to see the enormous opportunities that come from viewing products as portals into networks rather than as ends in and of themselves, where the advantages come from what new networks you bring. I’m always amazed at the new markets that people think to bring in–from linking Leapfrog educational toys with network content (Blues Clues, Dora the explorer, etc…) to voting someone off the island to downloading old Leave it to Beaver episodes to inserting local and targeted advertising in programs (a la GoogleAds).
About 3 years ago, I had a conversation with the President of Fox, though calling it a conversation gives me too much credit. I told him I believed TiVo would change the television industry and he called me a thief for stealing his programming. The Networks responded in classic fashion to a new technology: threat-rigidity. Unable to see TiVo as both a threat and an opportunity, they chose threat and responded accordingly. The opportunity to grab and hold viewers with interactive features, to move them back and forth between the web and the screen, was too obscured by their own visions of what they provided for them to see. They too had their product and couldn’t see how their own future depended on expanding the networks of those surrounding them. In their defense, TiVo failed to convince them because they too saw themselves too much as a box meant to replace–not augment–the existing networks.
Andrew Hargadon 
This is an example of the user created content and the wide spread implementation of individual product development. With tools and technology becoming more ubiquitous and cheaper we individuals are creating products and things we used to rely on others for. So innovation and design are going to trump product more so than ever. In addition the ability to cross platforms and incorporate a slew of added features with ease (leap frog) will keep buyers more interested in buying than building.
Randy,
This really is the challenge. Now that so many people can create, copy, or modify products, design is becoming more appreciated but also more accessible. How can design add distinctive value when it’s something everyone can tak part in? One side would say it’s because good design is harder to come by…but good design is also easier to copy these days. The trick lies in extending design’s reach beyond boxes and into the networks, where it becomes difficult, again, to leapfrog your own offering
[…] TiVo may be the brand name in the DVR space, but it’s no secret that they’ve faced a lot of competition from cable and satellite providers. Despite all of the doom and gloom that we’ve heard though, over the past few years, instead of fighting the cable and satellite operators head on, we’ve instead seen TiVo partner with these competitors and they now have licensing agreements with DirecTV, Comcast, Cox & the National Cable Television Cooperative (NCTC). Collectively, these relationships represent over 65 million potential homes that TiVo could find themselves in and with the DVR marketplace exploding in the growth, TiVo is well positioned to leverage these relationships to help accellerate their own expansion plans. […]