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Alan Breznick
Plunging into the emerging markets for interactive TV and video-on-demand applications, a Silicon Valley startup is recruiting cable operators and DBS providers for its new "personalized television" service.
TiVo Inc., founded by two former Silicon Graphics senior executives, is pushing an advanced VCR-like service that will let viewers tape up to 20 hours of their favorite TV programs, control the presentation of live TV broadcasts, search through program listings by various categories and receive other shows they enjoy. TiVo is marketing the pay service, delivered to a viewer's TV via a separate set-top box that must be bought, as a convenient, customized, time-saving tool for busy consumers, not video-on-demand.
"It's time-shifted programming available on demand, not traditional video-on-demand," said Edward MacBeth, VP-marketing and business development for TiVo, at a recent demonstration in Washington, D.C.
Unlike such VOD players as Diva, Intertainer and TVN, TiVo's service will offer all TV programs, not just select movies and soap operas, added Jim Barton, chief technology officer and VP-research and development for TiVo. "We don't have TV rights problems," he said.
Fresh off appearances at last month's Western Show in Anaheim and the recent Consumer Electronics Show in Las Vegas, TiVo plans to launch its service on cable and DBS systems later this quarter. It's now conducting field trials with DirecTV Inc. and local cable operator SunTel Communications LLC in the Silicon Valley area. It recently signed up E! Entertainment Television and its new sister network, Style, to provide special content. In addition, it recently gained an investment from Paul Allen's Vulcan Ventures Inc., and signed satellite receiver integration deals with DirecTV and Philips Electronics.
"We'll work on rolling it out system-by-system," MacBeth said. "It's a real opportunity to establish a category."
TiVo will charge consumers up to $10 a month for the VCR-like service, which will include the capability to pause, rewind and replay TV shows as they run. Consumers will also have to buy the proprietary TiVo box for about $500, although company executives said they hope to bring the cost down to $200 to $300 quickly.
Cable operators and DBS providers wouldn't pay to carry the service. TiVo intends to split subscription, hardware sale, advertising and other revenue with its distributors.
Working with their projected cable and DBS affiliates, TiVo officials aim to sign up as many as 5 million subscribers in five years. They hope to integrate their hardware and software into other video devices as cable set-top boxes, satellite receivers and TV sets by next Christmas.
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