TiVo acquired…but not by Apple?

February 26, 2005

Lots of chatter this month about TiVo, which is hurting badly and therefore has become the subject of many well-intended suggestions and a completely unfounded acquisition rumors.

Funny, because about six weeks ago, at CES, Microsoft and TiVo announced a deal under which shows recorded on some (not all) TiVo boxes would be portable to Windows XP PCs and, from there, to portable devices such as the Portable Media Center.

Now, TiVo first announced the TiVo-to-Go concept at the 2004 CES, but was stymied for a year by objections (sorry, link to original story is dead) from content owners. So the concept wasn’t new. The new–and interesting–part was Microsoft’s participation. Microsoft is trying to push its Media Center PC as a digital video recorder, meaning it’s in direct competition with TiVo, who basically invented and established that market. It’s very unusual for Microsoft to get on stage with a competitor, unless….

Well, at least one reporter from a major national business publication suspected the same, and called me to ask if I’d heard any inside dope on a Microsoft-TiVo acquisition. I hadn’t, and still haven’t, but to me, the deal does make some sense. What would Microsoft get?
1. Great branding for the next version of Media Center, which will probably come out with Windows Longhorn. (In fact, I suspect that Longhorn Home will be Media Center–there may not be a super-cheap “home” version of Longhorn without the Media Center functionality.) For me, one of the main flaws with Media Center is its marketing. What is it? It’s a lot easier to say “A PC with a Tivo in it” to the average consumer than “a PC with a bunch of digital media functions, including DVR, CD ripping, blah blah blah bzzzzzzzzz.”
2. A better guide than the one Media Center uses.
3. A nice addition to the Microsoft TV platform. Instead of Comcast having to roll its own DVR function with MSTV Foundation Edition (which is what they’re doing in the first deployment, here in Seattle), Microsoft would offer them the TiVo service and let them private label it.
4. They keep it out of a competitor’s hands. Apple’s already kicking Microsoft’s buttocks in the area of portable digital audio. A $1,200 Media Center PC becomes a harder sell when you can get a $600 Mac Mini with a TV card and TiVo built into it. The Windows Media Format becomes even less relevant when not only is AAC the standard for consumer audio thanks to iPod, but QuickTime becomes the standard for consumer video thanks to TiVo/Mini/whatever Apple calls the thing.

Skeptics would rightly point out that:
1. The current TiVo boxes are based on Linux. True, but Microsoft has in the past acquired companies that use competing technology. Hotmail ran on Unix servers. Placeware (Web conferencing company acquired in 2002) also ran on Unix and was based on Java. In both cases, Microsoft bought the company to get into a new market quickly, then slowly migrated them over to Microsoft technology.
2. The guide’s better than Media Center, but not $300 million better. Hard to counter this one. Again, I think Microsoft would mainly be buying the TiVo brand–and keeping it out of Apple’s hands.


A new start

February 25, 2005

Starting today, I’m going to limit my posts to the subjects of music, technology, and the intersection between the two. I’ve saved some past posts that fit into these categories, and blown everything else away.

Nothing could be timelier: the recording industry’s in free-fall, the iPod is the media-darling consumer product of the decade, and the “everything’s changing” meme has even trickled down to the half-baked weekly papers and low-level music industry hangers-on.

So who the hell am I to add to the din?

1. I’ve made a living writing about consumer technology for the last ten years, focusing on Microsoft for the last five. I know more about what’s going on within Microsoft’s digital media division than almost anybody outside of Microsoft, and probably more than most employees. (Usual disclaimers apply: this “blog” thingie has no relationship to my employers, they don’t know about it, and all opinions and swearwords are strictly my responsibility–if I offend you, please post a comment and let me know. Also, absolutely no confidential information regarding Microsoft’s business or business practices will be posted here. I like my job. I don’t like consulting with lawyers.)

2. I’ve written, played, and recorded music in amateur but working bands for the last twelve years. Unfortunately, this hasn’t enabled me to make a living, but it’s given me first-hand insight into how technology has changed music.

A quick example: it’s 1994. You’ve got songs, a band, and a rehearsal space. You think you’re pretty good. You want to take your music to the world. So what do you do? Well, you pool your money to go into a recording studio overnight (when rates are cheapest) and pay a “professional” engineer–some of whom are halfway decent, but most of whom just finished a program at the local community college and have ears of tin–about $1,000 to record and mix three or four songs onto ADAT (a form of digital recording that uses VHS tape, of all things). They probably have some expensive Mac and software for mixing and mastering, but you never touch the thing and have no idea how to use it. Once you’ve got the tape, you pay a duplicator another few hundred dollars to make cassettes, then package these cassettes with a black-and-white glossy, a snarky/earnest bio, and a Xeroxed copy of your press clippings. This is the package you send to clubs to get gigs, radio stations to get airplay, and newspapers to get coverage. Total cost: about $2,000.

If you’re rich, you use reel-to-reel tape and press CDs. Maybe you do a full-length. Total cost: $5,000 or more.

Sometimes someone in the band had a four-track recorder (which cost about $100 and used cassette tapes) for making song demos, or a DAT recorder (which cost about $500) for recording practices and live gigs. A few geeks were into some keyboard stuff called MIDI. And maybe if you lived in a high-tech mecca like San Francisco and had the right friends, you could get posted on a Web site like IUMA–which cost $200 back then. But generally, rock and roll was about guitars and microphones and tape and live shows, as it had been since the 1960s.

Now, kids are buying or borrowing laptops and sequencing/sampling/looping software, making full-length records, and sending clubs and bookers to their Web sites to download the MP3s. Cassettes? Gone. Reel-to-reel tape? Almost gone. (Very sad–there’s something spacious and beautiful about bass tones on tape.) Bio? Read the Web site. Photos? A digicam at the last gig. “Professional” engineers–well, you damn well better have experience, ears, and skills, because if you’re a poser your customers will be just as qualified, capable, and experienced as you. Major labels? More bother than they’re worth.

Only one thing’s certain: people are always going to make music. Where are the consumers? Who are the distributors? What’ll happen to the performers? Nobody knows.

This should be fun.