TIVO Business Analysis

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TIVO Business Analysis

TiVo COMPANY BACKGROUND

TiVo is a small black box which contains a digital video recorder that allows viewers to watch what they want, when they want to watch it, it allows Pause and instant replay of live TV by storing information on a hard drive.

The TiVo Service represents what has been called the “Personal Television Industry” – Total control over the way you watch television.

The company established manufacturing partnerships with well established firms like Philips and Sony, and also made some agreements concerning distribution through retail chains such as Best Buy, Circuit City and Sears.

In sum, the product was designed and developed by Tivo, and then licensed for manufacture and sold in retail channels as a consumer electronic device.

Price range is between $499 and $999, plus and additional $9.95 monthly for the TiVo servive (with the option to pay $99 yearly or $199 for the lifetime of the service).

Sales, expressed in terms of the number of subscribers, have been growing consistently over the 14 months of the conpany´s lifetime, yet, they have grown at a much slower rate than the one that was anticipated in face of the dimension of the market and of consumer satisfaction.

It is no wonder that the company has been carrying losses through its short existence, yet, it is disturbing to find that there is no evidence of the sales “take-off” that has been expected to happen, especially on the Christmas shopping season.

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