Does the TiVo Premier Really Make the Invention of the DVR Look Like a Warmup?

The new TiVo Remote with smart phone-like QWERTY Slider Keyboard

We expected a lot. TiVo is a company that never quite achieved the financial success that one would expect from a company that invents game changing technology. People – especially their shareholders – want to know.

So let’s take a look at the expectations vs. the reality.

Expectation: New DirecTV DVR
Result: Nope.
Crystal Ball Says: Should still be coming with a few months based on TiVo’s own statements.

Expectation: New Non-Retail Cable Company offered DVRs
Result: Nope
Crystal Ball Says: Again, based on TiVo’s own statements, an offering for RCN should be coming soon. TiVo based software updates for Cox and Comcast DVRs are also expected.

Expectation: Mind blowing new retail DVR for cable TV and antenna users
Result: Sort of.
Crystal Ball Says: It’s definitely a sizable improvement over TiVo’s current offerings. But will customers opt to put down $300-$500 for the box and pay up to $12.95/month for TiVo service instead of just renting the cable company’s DVR? Let’s see …

Behold, the TiVo Premier
This is it – just one product (in two variants) was announced. The TiVo Premier does indeed live up to some of my earlier hopes and expectations. But misses out (so far) on some others.

The two models are the TiVo Premiere and TiVo Premiere XL and will cost $300 and $500 respectively. The usually TiVo monthly service fee is required as well. There are no changes to the fee structure. It’s still $12.95/month or less if you buy 1 year, 3 years, or a lifetime subscription in advance.

High Points:

New all HD interface
An all HD interface is one of the key marketing points for the Moxi HD DVR. This now mutes that marketing point. Additionally, non-DVR set top boxes like Roku, Boxee, and Popcorn Hour all use slick HD interfaces.

Screenshot of the new UI

More processing power
Zatznotfunny is reporting that the new TiVo uses a 400MHz Broadcom BCM7413 System-on-a-Chip. One interesting tidbit about this chip is that Broadcom markets it as an IPTV chip. Though, there’s no word from TiVo as to whether or not there is (or will be) and IPTV functionality coming from TiVo

New QWERTY slider keyboard
One of my most wanted features is finally here. TiVo will be offering a new Bluetooth remote control which hides a slider mini-keyboard underneath the familiar peanut shaped button pad. The TiVo Search functionality is getting a boost in presence on the new device. Searching involves typing (and often times refining a search with multiple subsequent searches). So this is a great new feature

Includes Bluetooth, so maybe you can get your own keyboard?
The new keyboard operates over Bluetooth. So no line of sight it needed. If you stash this TiVo behind a cabinet door there will be no problem controlling it from the Bluetooth QWERTY remote.

Pandora (and possibly other apps) are coming
Fans of the Pandora streaming internet radio service will be excited to have Pandora support built in. This also shows that TiVo is waking up to competition from Internet video STBs (Roku/Boxee/etc).

1990′s era modem is gone
About time! While Internet video STBs and Moxi are content to be broadband-only, it was kind of weird to a see a clunky RJ-11 jack on the back of TiVo in this day and age.

Low Points:

512MB RAM seems a little low by 2010 standards
Tiny Smart phones like the Google Nexus One and iPhone include that much memory. For a large-ish set top box (and given the low cost of memory) you would think they could put some more in. Granted, out of the box, 512MB is probably more than enough RAM to carry out TiVo’s specialized tasks. But, if there is going to be an API and apps, more memory means more apps can multitask at the same time.

Awesome QWERTY remote is not included
TiVo’s going to charge extra for the cool little remote. Not only that, but there’s actually a total of three new remote control models! For the price (starting at about $300) they ought to just keep their manufacturing simple and just make the one QWERTY remote and include it with both models. It would simplify manufacturing. Not only that, but the standard remote risks annoying potential new customers – especially since search (which involves typing in letters) is such a prominent feature. Using arrow keys to search is just painful.

No tru2way
A common complaint of the current crop of retail DVRs is the lack of two-way functionality. tru2way is the cable industry’s proposed standard for allowing third party STBs like TiVo to get access to Video-on-Demand and Pay-Per-View. It’s already available on a select number of Panasonic televisions.

A lot of folks (myself included) may be able to look this over. For one thing – it probably wouldn’t even work if it was included since only a small number of cable TV subscribers actually live in markets where tru2way is implemented. Furthermore, a DVR is Video On Demand. Much of the cable VoD content I’ve seen is just archived programs that you could have just recorded and played back on demand. And much of Pay-Per-View are movies that you could rent or stream via Netflix or other services.

No Switched Digital Video support
SDV allows the cable company to offer more channels on the finite bandwidth of the coaxial cable by only sending certain channels down the pipe on demand – after you change to that channel. Tens of millions of cable TV users now live in SDV markets. You can tune SDV channels on a TiVo, but it requires the use of a cable company provided box plugged into one of the TiVo’s USB ports to work. On the bright side, many cable companies seem to be giving the SDV tuning adapters away for free (and installed for free too) to TiVo and Moxi users.

No home networking enhancements
There don’t appear to be any enhancements regarding TiVo’s support for home networks. One of Moxi’s strong suits is the ability TVs in different rooms to share content by streaming recorded programming over the home Ethernet. No word if this is a possibility. Also no references to PC/Mac/Linux to TiVo interaction.

Still only two tuners
OK, you have to be a real couch potato to think this is a big deal. But have you ever noticed that most of the time, there’s nothing good on TV to watch. But when there is, it seems like all the programs you want to watch are on at the same time? Well, that’s why we need more than two tuners. Moxi offers a model with three tuners.

No additional apps beyond Pandora are included
The inclusion of Pandora seems to indicate that TiVo does also realize that Internet Video STBs are real competition. We are now seeing a growing number of affluent people ditch cable in order to watch all of their programming via antenna and the Internet. I see the lack of support for Hulu and other Internet sources as a downer.

On the up-side, if we do see the API’s used to implement Pandora opened up to developers, Hulu and other apps might not be far off. Additionally, Hulu relies on Flash for Digital Rights Management and Flash is now built into TiVo.

No built in WiFi. WiNot?
You could make the point that wired Ethernet is faster and better than WiFi. But WiFi still works well for downloading video podcasts and other Internet content. And the electronic components to implement WiFi are cheap. So, for the price, why not integrate WiFi?

I’m guessing the cost of the WiFi adapter and the QWERTY keyboard are going to run at least $100. If that’s the case, that makes the entry level product $400 instead of $300.

No change to off-putting service fee structure
The $12.95 monthly fee has to be the biggest reason not to get a TiVo. Most cable companies charge about that much a month for their DVRs. But with the cable company, you don’t have to shell out hundreds of dollars to buy it. Sure, you could argue that TiVo is better – but most people won’t care if the cable company’s DVR handles the basic tasks without burning the house down. Then, there’s the people who might agree that TiVo is better but don’t want to pay the monthly fee on the principle that all they really getting – the essential feature of the service – is program guide data. And again, this is something that Moxi and other DVR users can get for free.

This is something that I talked about in my previous post. TiVo has to figure out how to better monetize the monthly service. Between TiVo’s selling of advertising services (like ads on TiVo menus) as well as the sale of Nielson-like viewing data, that ought to be enough to offset the cost of providing program guide data.

In the past, before broadband was ubiquitous, people had to use a modem to dial in to the TiVo service. Maintaining a dial-in service is costly. But these days, how many people are going to use a modem to contact TiVo. And if people are, why not charge modem users more for the feature? And that brings us to ….

Dial-in modems are still supported
It’s not built in anymore, but TiVo will be manufacturing and selling a USB modem for dial-in users. So, TiVo is still expending money to engineer, manufacture, and maintain a modem and dial-in services. In 2010 it shouldn’t be needed. If there really are some folks who need to use a modem, there are Ethernet to Internet dial-up bridges that should be used instead.

The New TiVo Premier

On the up side
Aside from two-way and SDV, the biggest issues are all mostly solvable via software updates or pricing changes. Simple software updates could provide new features like an API and an App Store for on-box applications and a Web Services API for off-box PC/Mac/Linux applications (these would be market opening features). And TiVo themselves could use a Web API for box-to-box communications – like streaming a program from the living room TiVo to the TiVo in a bedroom or using two TiVos to become one virtual four tuner DVR.

What if?
And it seems like all new electronic products drop in price within a few months. So maybe when that’s ready to happen, the next revision can just simply include WiFi, Bluetooth, and the Bluetooth QWERTY remote. If TiVo were to simply do this and eliminate the monthly fees, they make the box look like a better deal – perhaps even at a higher price.

What if both models were $400 and $600 ($100 more), but included WiFi, the Bluetooth QWERTY remote, and and end to the monthly fees? They would immediately end the value debate versus cable. They would sell more units – enabling better economies of scale to bring down manufacturing costs further – thus making the hardware more profitable. And they would then have a much larger audience – making advertising and data sales that much easier and more lucrative.

Verdict
So did TiVo go so far as to make the invention of the DVR look like a warmup? I think that statement was so bold, they couldn’t – and didn’t. The TiVo Premier needs more features and capabilities to really look groundbreaking. But, it does look good – and a step in the right direction. Some problems are just in software and can be fixed as a software update. Others like WiFi and the inclusion of the QWERTY remote can be fixed through simple hardware engineering and bundling. Much of the rest can be fixed by pricing and better monetization of the the online service component of TiVo. SDV and two-way functionality are up to the cable industry and/or the FCC.

Even then, we still won’t be looking at anything so groundbreaking it would make the invention of the DVR look like a warmup. But it will be good – and most importantly for the company – sellable and profitable.

Other good reads:

• Zatznotfunny
• PC World