Yankee Group: TiVo No More By 2010

By Ed Oswald, BetaNews

January 22, 2007, 11:00 AM

TiVo has long been the target of much speculation surrounding its future as an independent company. Now a prominent analyst firm says its likely the company will not exist much longer as it will struggle to remain relevant in the market.

The end of TiVo will be the result of the dissolution of the standalone DVR product category as a whole by 2010. Instead, says Yankee Group, the technology would be integrated into other services, negating the need for standalone offering.

With the commodization of DVRs, the biggest benefit would be the advent of what it calls "Advertising 2.0." As more and more consumers turn to the technology, less and less of traditional TV ads will likely be viewed.

"It is important that advertisers, service providers and broadcasters remember that taking away the Anywhere Consumer's ability to skip commercials is not an option," said consumer analyst Joshua Martin.

Instead, advertisers will have to find new ways to reach these consumers. This would likely be done in much the same way as what TiVo is doing now to get ads in front of the consumer. Included in this would be concepts such as interactive, location-based, and time-relevant advertising.

Much of the above reasoning is why TiVo is changing its business plan to adapt to the new realities of the industry. In recent months, the company has put a lot of effort behind CableCARD technology, which would allow its boxes to act like digital cable set-top boxes.

Additionally, it has become more aggressive in developing a version of its service for cable companies, such as Comcast and Cox. With the loss of DirecTV as a partner, TiVo has struggled to add new subscribers, and is in desperate need of a new revenue driver.

However, TiVo's recent efforts are not enough to change Martin's mind on the company's fate. "TiVo has incredible brand value that resonates with customers and it will be an asset to any service provider, increasing the likelihood of an acquisition," he said.

TiVo could not be immediately reached for comment.