Product Strategy in The Digital Economy
TiVo Project
Cristian Lopez Saubidet - James Phelan - Pablo Sanchez

Company
Vision: To be the leader in Personal TV
Services.
Hardware Partners: Philips, Thomson and
Sony
Content Partners: AOL and DIRECTV
History:
 1997: TiVo founded by Jim Barton & Mike Ramsey
 January, 1999: TiVo unveiled for the first time to the public at CES

TiVo System

TiVo System
 Recording
 Automatic Recording
 Search Through Up to 2 Weeks of
Programming
 Record by “Wish List” (Favorite Actors,
Sports Teams, or Key Words)
 Rate Programming

TiVo System
 Live TV
 Pause Live TV
 Replay Live TV
 Parental Controls
 Inter-Active TV
 TiVo Suggestions
 TiVolution Magazine
 Network Showcase
 Ipreview

Critical Issues Grid
The Company
Will TiVo succeed?
Political Will TiVo have patent protection?
Behavioral
Economic
Social
How easily will consumers learn to use TiVo?
How much are consumers willing to pay for TiVo system?
How much are they willing to pay for the service?
Will TiVo become fad?
Will consumers embrace TiVo?
Technology Will TiVo develop new uses?

Critical Issues Grid
Business Ecosystem
Will TiVo succeed?
Political Regulation of content: Copyrights, Ads
Behavioral
Economic
How intense will competition be?
Will competitors succeed?
Are there many substitutes for TiVo?
How much of a threat is TiVo to advertising?
How big will the total market be?
Social
Technology
Will new segments use TiVo: Education,
Commerce?
Will there be an industry standard?

Critical Issues Grid
Infrastructure
Will TiVo succeed?
Political
Behavioral
Economic
Regulation of Infrastructure: Cable, Satellite,
Phone-lines
Will content availability increase?
Are there many complements for TiVo?
Social Are there network effects?
Technology
Will infrastructure be able to support the technology?

TiVo’s Network consumers learn new uses willingness to pay for s fad threat to ads patents standard content availability willingness to pay for s network effects content regulation infrastructure regulatio
Competitors success complements intensity of competition substitutes Customer's embrace new segments size of the market infrastructure support
TiVo's Success

Network Scenarios
3 States: Dominate, Survive, & Die
Scenario 1 (Base)
 Dominate = 17.2
 Survive = 38.4
 Die = 44.5
Scenario 3 (Worst)
 Dominate = 0
 Survive = 25.0
 Die = 75.0
Scenario 2 (Best)
 Dominate = 75.0
 Survive = 25.0
 Die = 5.0

Network Sensitivity
Node
Intensity of
Competition
Market Size
Positive Factor
Negative Factor
State
High
Medium
Low
Large
Medium
Small
Change from Base
Dominate Survive Die
(6.36)
13.22
26.49
13.76
(2.07)
(15.82)
1.11
(1.13)
(6.18)
10.29
(1.08)
(12.41)
5.25
(12.09)
(20.31)
(24.05)
3.15
28.23
0.00
0.00

Conclusion
TiVo needs to work to expand its potential market size
 Open up its architecture to a wider base
 “TiVo enabled” DVDs, VCRs, and even TVs
 Commoditize the product
 Push to find new, unexpected markets for its product
 Education
 Business

Conclusion
TiVo should also work on building a stronger network effect for its products
 Complimentary Products(i.e. swappable hard drives, TiVo Storage CDs)
 New Revenue Stream
 Possibly New Business Models
 “Sticky” Services
 Put consumer knowledge on server rather than local

Questions???