Megan McArdle

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Tivo and Netflix: the underdogs band together

31 Oct 2008 10:07 am

I love my TiVo Series III.  Indeed, I'm something of an evangelical about it.  But it's hard to convince someone that they should lay out several hundred dollars for a box, and another several hundred for the subscription, when their cable provider will give them a DVR for $5-10 bucks a month.  Yes, the TiVo provides superior menus, searching, and other services.  Yes, it plays podcasts.  Yes, you can copy video to your PC to carry around or edit--but how many people use this? (Aside from me).  And I've really been liking the ability to download movies and shows from Amazon Video On Demand (formerly Unbox).  But I'm not sure that this, too, isn't a minority taste.

As someone who would like to see the company keep going, I was pretty happy to see that yesterday, TiVo and Netflix finally announced that they would be partnering to deliver instant streaming video.  If you have a Netflix subscription (and a TiVo, of course), you can stream all the video you want at no additional charge.  The deal makes a lot of sense:  both companies are struggling, competing with Bittorrent and the cable companies to keep their business models alive.  But together they can offer something that the cable companies will have to step up their game considerably to compete with.  Indeed, the deal makes so much since that people have been waiting for it since 2004, when it was announced with much fanfare and then went nowhere.  Yesterday was the fruition of a long-held dream.

The service isn't perfect, since Netflix's library of movies available for streaming is limited thanks to licensing issues.  And I don't think they're available in Blu-Ray quality, though the Amazon videos I've downloaded have been competitive with my HD movie channels.  (That may be because Comcast compresses it HD signal heavily in order to cram more channels into the pipe).   But at least it will give two companies I'm very fond of a fighting chance.  It's worth remembering that at this point in its lifecycle, a lot of people thought Amazon was going to join the other etailers in bankruptcy.

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» The Tivo/Netflix partnership: too late? from A Couple Things
Tivo and Netflix announced movement on their long-await partnership yesterday. Like Megan McArdle, I’m a fan of both. My concern, however, is that this partnership comes a bit too late. The DVR game is old news. Comcast, TimeWarner, etc., have s... [Read More]

Comments (17)

the other Geoff

I'm also a big fan of both of these, having been a member of both since 2000 or so.

However, do note that this is available only on the shiny newer TiVos, the HD and Series 3 stuff. Which I don't have. Supposedly, I'll be getting my Netflix streaming over Xbox 360 quite soon though.

The Underdog: A song for the Cable Companies (with apologies to Spoon)

Picture yourself in the living room.
The tivo and netflix teamed up 'gainst you.
I know you think it ain't too bad.

But I hear the call of the on-demand
And don't need to pay more for it
oh you cut out the middleman
get free from the middleman

You got no time for the customer,
got no regard for the thing that you don't understand,
you got no fear of the underdog,
that's why you will not survive!

I wanna forget how I get my bits
but can I get out from under it?
Can I gut it from TV?
It can't all be bit-torrent
It can't all be stolen for free
I try but I can't let go of it
Can't let go of it,

Cause you don't talk to the customer
and there's so much you could learn but you don't want to know,
You will not back up an inch ever,
that's why you will not survive,

The thing that I tell you now
It may not go over well
And it may not be business-op
in the way that I spell it out

But you won't hear from the customer,
don't wanna know bout something that you don't understand,
You got no fear of the underdog,
that's why you will not survive! (Hey!)

Is Netflix really struggling? Their subscription numbers keep going up, and I'm pretty sure their cost-per-new subscriber number has gone down.

This is good news for consumers. I use the blockbuster mail-in service because I like the instant gratification option of being able to exchange DVDs in the physical store.

In all other respects the Netflix service is superior to Blockbuster's (better library, faster mail times, better designed website). Now that Netflix is also offering an instant gratification option I might switch, or Blockbuster might raise its game. Either way, its good.

I miss my Tivo immensely. I've used a TimeWarner DVR and AT&T's U-verse DVR and both fall far short of Tivo. Yes, they can both be scheduled to record a show, or series of shows, but that's about it. Fast-forwarding through the commercials on either generic DVR is a pain in the ass. Tivo makes it nearly effortless. The Tivo has far more functionality, ease of use and just intuitiveness about how to search for, schedule, record and watch shows. There's not comparison. And that doesn't even begin to explore the other features you mentioned, esp. the new deal with Netflix.

There is still no way in hell I'm shelling out well over $500 for the box and service just to download movies. I can wait for a new DVD in the mail, thanks.

However, do note that this is available only on the shiny newer TiVos, the HD and Series 3 stuff. Which I don't have.

Yeah, this sucks for those of us with Series 2 TIVOs.

I imagine it isn't for everybody, but I've become a fairly big fan of Boxee. It is a free frontend for either the AppleTV or on a Linux box.

http://www.boxee.tv/

Think any given webservice out there that provides free or ad driven media, this thing will stream it to your TV. It will stream Hulu, YouTube, NPR, LastFM, etc. I do not doubt it will do Netflix eventually.

But the best part is that it has a social networking aspect by showing you what your friends with Boxee are watching and recommend. I suppose the next step is they'll add in some functionality like Pandora, where you pick a couple of shows/songs you like and it starts making suggestions based on that and what media you vote up or down.

That social networking/targeted preference prediction is really the future of digital entertainment. I hope the other players in the game discover that soon.

Brad -

The Series 3 TiVo has been discontinued, and TiVo now only sells the TiVo HD for $299, and the TiVo HD XL for $599. The difference is that the XL has a much bigger disk; it holds 150 hours of HD video. (I suspect it has a 750 GB disk.)

So you're not shelling out $500 - only $300.

And the TiVo UI is so much better than the terrible, awful, horrible UI on the cableco DVRs. My Comcast DVR wouldn't record a show, only a time; so if your show got rescheduled, well, too bad for you.

Worse than that, the fast-forward button was erratic - sometimes, button presses would get queued, so you would push the button, nothing would happen, you push the button again, nothing would happen, you push the button again, all three button pushes run, your show flips to the end, and you can't rewind from the 'end of show' marker. Too bad, so sad.

After about 9 months of that kind of personal abuse, I bit the bullet and bought a TiVo Series 3. Elegant UI; I really like the "TiVo Suggestions" for recording shows that I like, but that I don't want to commit to recording every episode of.

Quantum Mechanic

Yeah, this sucks for those of us with Series 2 TIVOs.

Well, given that NetFlix uses an encoding that S2 TiVos intrinsically can't handle, it's hardly surprising this is limited to S3 and TiVoHDs.

Yes, the TiVo provides superior menus, searching, and other services.

I find it hard to imagine "superior menus" to my Comcast DVR making any difference. Not because I think Comcast has especially wonderful menus, but because menus form such a small part of my life that it's a little like saying I should spend $47/lb for gourmet salt.

Kenneth Parker

Xbox360s are about to be able to stream Netflix content and Netflix is supposed to be add high-def streaming before Thanksgiving.

TiVo is for TV Lovers. The movies, pictures, youtube, tivo2go, etc are add-ons. If you just want the movies, then yeah, this doesn't work for the Brad's of the world. But for those that LOVE their TV/Cable shows AND all the bells and whistles when they want them, the way the want it, TiVo is the ultimate media server.

But TiVo better not rest on their laurels...the XBOX-Windows Media Server combo is slowly creeping its way up.

I'm not sure that TiVo is for "TV lovers" so much as it's for those who watch some TV and want to watch it on their own schedule. I watch maybe an hour a day on average but I want to determine when that hour is. I think if I had to go back to pre-DVR I'd probably just stop watching television entirely and just watch DVDs (or streamed TV).

I have a PC hooked up to my TV so this announcement isn't a big deal for me. But, in general, being able to watch streamed Netflix on a TV rather than a PC makes it useful--which I really didn't find it before.

I used to have a TiVo, but now use Motorola's DVR with my Verizon FiOs service. Boy, what a disappointment that is in comparison, and I didn't even have a fancy TiVo. The fact that the DVR's software wasn't even compatible with FiOs for months and caused TONS of problems certainly didn't help either. And what's even more insulting is that Verizon periodically increases our monthly rental rate, but we don't get new or better boxes. As one guy at our last HOA annual meeting put it: "I thought technology depreciates, so how are we getting charged higher rates for older equipment?"

And as a Netflix subscriber since 2000, I would love to have that compatibility as well. Time to get my husband to look into this.

Megan - Don't forget TiVo also now offers content downloads from Jaman.com and Disney content from CinemaNow, in addition to the Amazon VOD (formerly Unbox) content. Plus all the free content from TiVoCast, and streaming from YouTube.

Al - The TiVo Series2 is only capable of decoding MPEG-2 (well, and MPEG-1, but we try to forget that). The Series3, TiVo HD, and TiVo HD XL also support MPEG-4/H.264 and VC-1. And it is these newer codecs that are used by streaming services. YouTube streaming is using H.264, which is why that doesn't work on the S2. And Netflix is using VC-1. It is just a limitation of older hardware.

Eric - The TiVo HD XL has a 1TB disc, the TiVo HD has 160GB, and the Series3 250GB. All three support expansion via eSATA, and if you're not afraid to crack the case you can upgrade the internal drive. And keep in mind those are all MSRPs - you can find the systems online for less, the TiVo HD is often $250 or less for example.

Christina - the TiVo Series3, TiVo HD, or TiVo HD XL with CableCARD are compatible with the FiOS service. So those are options.

I am no Luddite, I like progress as much as anyone. But I am cheap. Shelling out a good chunk of money for a box, and then spending money to subscribe to the service is something my conscience won't let me do. Plus, you need to worry about technology upgrades and bandwith issues. Cable companies cannot afford to give unlimited downloads, so it is only a matter of time before they start limiting downloads to its customers.

By contrast, Netflix by mail is convenient and in my part of the Chicago metro area, quick. I use the same DVD player I received as a gift six years ago and am very satisfied.

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