Q&A With TiVo CEO Tom Rogers14 Jul, 2005 By: Diane Mermigas
TiVo may have propagated the content time-shifting phenomenon, but seasoned media executive Tom Rogers' mandate as its new CEO is to navigate the tricky waters of change and challenge. Wall Street is looking for Rogers to extend the brand, reinvent its business model and align itself with such Internet giants as Google and Yahoo! At the moment, a sale or merger is not an option, sources close to the company insist. Rogers recently discussed key issues facing TiVo with The Hollywood Reporter contributing editor Diane Mermigas.
The Hollywood Reporter: What are the new marching orders for TiVo as a company?
Tom Rogers: The new marching orders to the entire organization is speed. We are a small company working in a world with so many big companies, and so much competition, and so much scrutiny about how we're doing. You have to work at triple the speed as everybody else. So we need to make decisions faster and put plans into place faster. I want deals to be cut faster, and sales and marketing to be able to understand what moves products and to respond faster.
THR: How do you feel about the growing competition to TiVo's fundamental business?
Rogers: There is no doubt there is a lot of competition. There also is no doubt that 94 percent of all TV homes don't have a DVR, so there is a lot of opportunity. There are roughly 3 million TiVo DVRs out there, and there are roughly 3 million to 4 million other DVRs out there. DVRs may look like a niche product now, but they are going to grow to 40 percent, 50 percent, 60 percent penetration over time. But we are what people think of as: the leading branded experience. We are way ahead of the rest on advertising, which is a real draw for the mass distributors. We have all kinds of advanced features that people quickly are focusing on, such as mobility with TiVoToGo, networking within your home and remote scheduling — things that will continue to set us apart.
THR: How are your talks with other media companies going?
Rogers: I'm not going to comment on our talks with specific companies, but there isn't a major company out there with ambitions or current business in the television field or in the video realm that wouldn't have some intersection with TiVo, in terms of distribution, marketing or advertising opportunities. Every company has its own view of how TiVo might fit into what they want to do.
THR: Are you pursuing talks with other MSOs along the lines of your partnership with Comcast Corp.?
Rogers: We've been approached, and we have some discussions going, but it's much too early to tell.
THR: Are you talking with any other content providers and distributors?
Rogers: We are seeing some interesting discussions on that front. That's an active area.
THR: How do you feel about the end of TiVo's partnership with DirecTV?
Rogers: Over time, the cable side of the equation, and all forms of mass distributors, will be bigger contributors to our business than stand-alone boxes. They already are. Two-thirds of our subscribers are DirecTV, the rest are stand-alone boxes.
THR: What does the future of interactive advertising hold for your company?
Rogers: It was one of the drivers in the Comcast deal, and it is something that the advertising industry is very focused on, because an overwhelming number of people with DVRs skip through ads, and the number of DVRs we're going to see out there is clearly going to substantially multiply. In some respects, scale matters a little bit less because ESPN and CNBC only get one slice of viewers' attention. If your DVR is your main access point for all your channels and all your viewing, you have the opportunity to be part of a viewing option that is more important than any one channel. So, you might not have to get a level of deployment that people have typically associated with fully distributed cable networks by virtue of the fact that you are the access point for all viewing.
THR: How concerned are you about the consistency and validity of user measurements in general, even though TiVo does its own?
Rogers: There is a fascination today with that kind of data. When you can demonstrate what the audience is watching and how they are watching it, the more valuable that information gets. That, packaged with our advertising business, we hope will create a meaningful revenue stream.
THR: How do you improve the marketplace's perception of TiVo's growth prospects?
Rogers: We have to do some things different in retail. We have to continue to look at deals that will drive mass deployment so that we are convincing people there is a sub growth story that is real. There is a lot of work to be done on that.
THR: Will there be further management changes?
Rogers: TiVo has a hell of a team. It is 350 people who have created this device and all that has flowed from it. Along the way, there may be some new talent we take on, but I am highly committed to working with the existing team.
THR: What about the prospects for expanding internationally?
Rogers: We've been slow on that front, but there are many opportunities to look at.