COMMENT: The decision by the Seven Network to cut their Hybrid TiVo operation loose was inevitable as consumers moved their viewing preferences to new HD channels and new IPTV services, over what is fast becoming old set top box technology.
From day one of TiVo being launched in Australia Hybrid had a major problem, due to the cost effectiveness of their personal video recorder which sold in Australia with an attached storage device at one stage for over $999, recently the price was dropped to $700 while competitors like Netgear and Western Digital were selling a media player with 1Tb of storage for sub $299.
TiVo customers were also being charged an additional $69 for a wireless dongle so that they could connect their set top box to the Internet. This also meant that customer, had to have a wireless enabled modem or separate Wireless router.
They also had to compete with vendors like Topfield, Beyondwiz and DTEC were offering set top boxes with direct Internet capability and wireless.
Also impacting TiVo was the Freeview software which was used by consumers to search for over 40 channels of information in a similar way that TiVo was delivering content information. This software was available on most of their competitors set top boxes and built into most HD TV’s being sold in Australia
Another issue was that the licensing fees charged to Hybrid by TiVo in the US for their software, was expensive and the physical TiVo unit which had to be purchased in bulk in an effort to keep the cost down, was also expensive despite the fact that the box was very limited due to a small hard drive and a lack of external ports and Internet connectivity other than a wireless dongle that cost extra.
Several times Robbee Minicola, the CEO of Hybrid TV, the distributor of TiVo in Australia overstated the capability of the TiVo service.
Last year she was challenged over her claims that the new TiVo PVR was the first digital set-top box capable of recording 3D. Several competitors said she was plain wrong.
Known as “Motor Mouth” in the industry Minicola burnt through cash at a fast rate of knots hiring staff as she tried to build her TiVo empire into something that it was never going to be.
In January and knowing full well that TiVo was in trouble and had already started laying off staff Minicola told CNET Australia that “nothing is happening to TiVo in the Australian and New Zealand market”, and said that recent price drops were due to the strength of the Australian dollar.
“Why would the number one PVR exit the market?” Minicola said at the time. “Nothing is going on with Hybrid TV … it’s just business as usual,” she added.
When the pink notices were handed out the Company had over 40 staff for an operation that only managed to sell 100,000 units in a two year period.
When Foxtel was launched James Warburton then Director of Sales for the Seven Network claimed that 70% of Australians have turned their back on Foxtel and that 60% of Foxtel customers are paying a monthly fee to record free to air TV.
Launched during the high profile Seven Network coverage of the Greece Olympics, TiVo was backed by multimillion dollar advertising campaign normally associated with the launch of a major brand or product yet despite this Minicola was unable to produce the profits that the Seven Network anticipated from TiVo.
Nor was she able to deliver a box that kept pace with the technology evolution taking place with the delivery of content. Earlier today Telstra announced 30 new Foxtel channels for T Box a competing service that managed to grab 120,000 subscribers in less than 6 months of being launched.
Now TiVo is set to ditch hundreds of TiVo boxes in the market as they move to clear t6heir warehouses of stock.