With Tivo prepared to offer searchable, downloadable advertising, I wonder if it enhances or detracts from a Google acquisition? In a previous post,
I thought a Tivo-Google marriage made sense because it would offer
Google an easy and relatively inexpensive way to establish a foothold
in the television market. Now, I'm not so sure. If Google is interested
in this market, there are other routes it can take other than spending
$500-million on Tivo. For example, it could sign deals with cablecos
such as Comcast, which appears to be a strong Google ally, to offer
AdSense/keyword advertising on a PVR device. Google could also strike
deals with a DVR makers to produce a low-cost product with Google
AdSense as a built-in feature. As Om Malik
points out in the latest issue of Business 2.0, Google M&A strategy
is focused on technology and people rather than full-fledged companies.
This pretty much eliminates Tivo as a takeover candidate – not even
taking into account the competition it's facing from cablecos,
satellite TV and, increasingly, telcos. A more likley scenario is
Google deals with a wide variety of service providers to create
revenue-sharing advertising opportunities in whiche content and
relevant-based advertising are seamlessly merged. So where does leave
Tivo? I suspect it will carry on with its
throw-spaghetti-at-the-wall-and-see-what-sticks strategy until
something works.
Regardless of what this means for a TIVO-GOOG matchup (and I tend to agree that it is not very likely, though “AdSense for TV” would be jaw dropping for advertisers), the fact that some big US ad agency roll-ups are piloting something with TIVO speaks to the tectonic shake-up building in traditional media. Seems like some of the old-school mass media types might be starting to pull their heads out of the sand. Nice to see them at least trying to play with new models; they simply have to start getting ready to offer advertisers brand building alternatives or they will see their businesses shrink violently (same for traditional broadcasters, clearly).
That said, TiVo, though addictive, handy and cool, is far from ubiquitous. Only when TiVo-like functionality lives in every machine as it leaves the TV factory or they start giving the boxes away will this type of thing really move the ad game needle. In the meantime, as you say, it remains spaghetti on a wall. Too bad.
Of course, a GOOG move to do “AdSense for TV” directly with cable players, offering some kind of broadband/cable bundle that would include a PVR-cum-AdSense local box of some sort for free if you agree to accept tailored ads…
- Stuart
I think you're right to be skeptical about a Google takeover of TiVo, Mark. Not only does it not fit with their strategy, but TiVo offers very little that is in any way unique or compellingly different from what Google could create themselves with a non-proprietary partner or partners — the same argument that I think made a takeover of Skype unlikely, especially at the kind of price eBay paid.