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TiVo Launches Ad Campaign, Rebates

August 10, 2004|From Associated Press

TiVo Inc. unveiled a marketing campaign and price rebates Monday, marking the digital video recorder pioneer's most aggressive -- and most crucial -- push yet to win subscribers and become profitable.

The Alviso, Calif.-based company, whose revolutionary technology records TV programs without the hassles of videotape and lets users pause live TV and do instant replays, is offering $100 rebates for its own branded DVRs as well as several other devices that use TiVo's technology.

The promotion drives the price down to $99 for a 40-hour TiVo Series 2 model, $199 for the 80-hour model and $299 for the 140-hour model.

Print ads are planned in dozens of newspapers and magazines. TiVo products, which are already sold through retailers such as Best Buy, Circuit City, Good Guys and, also will expand to Sam's Club, CompUSA,, Fry's Electronics and Costco.

The moves are part of an ambitious growth initiative that TiVo announced in March, when it set aside $50 million in marketing expenses to help it more than double its subscribers to almost 3 million by the end of January.

"This will set the stage and give us a chance at profitability by the end of our next fiscal year," said Brodie Keast, TiVo's executive vice president and general manager.

TiVo has a loyal following of users but faces increasing competition from cable and satellite providers that are introducing DVR features without TiVo's service and usually with service charges lower than TiVo's $12.95 a month -- maneuvers that steepen TiVo's uphill battle for customers.

"This is their shot to get a whole lot of new subscribers before cable DVR subscribers really take off," Forrester Research analyst Josh Bernoff said.

Shares of TiVo fell 48 cents, or 10%, to $4.30 on Nasdaq.

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