June 27, 2009

Ten Year TiVo Veteran Talks History, Hacking and Partnerships

About two years ago, I had my first visit to TiVo's headquarters in Alviso, just outside of San Jose. That visit only lasted a few minutes, and gained me a new remote control, replacing an original that had passed on. But on Friday, I had the privilege to stay quite a bit longer, as a guest of Stephen Mack, Director of TiVoCast Operations, as he took me on a quick tour of the company's offices, and we caught lunch, talking about his decade at the DVR pioneer and providing insight into one of Silicon Valley's arguably most interesting companies, sporting an incredibly loyal fan base, which includes me as a member.

Mack joined TiVo from SGI in March of 1999, less than a month before the company's first digital video recorder units were scheduled to ship. As he told me, co-founder Mike Ramsay had made the promise that the units would ship by the end of the first quarter of 1999, pushing the company to practically work around the clock, including nights and weekends, to meet the aggressive goal, making their offering first to market, just ahead of then-rival ReplayTV. This episode of Silicon Valley folklore came despite the fact the company, as he put it, had no working software, no working hardware, and no way to sell the products only weeks before the impending launch. Just squeaking in under the wire, the first units shipped on March 31st of 1999, on a blue moon - which is commemorated on the last Friday of each March each year at TiVo, as "Blue Moon Day" - an official company holiday.

Stephen Mack In His Busy Cubicle at TiVo

In the ensuing decade, TiVo set the gold standard for digital video recorders in an extremely competitive market that saw the term DVR genericized by a stream of copycat providers, including the local cable companies, DISH Network, and an on-again off-again relationship with DirecTV, who helped provide the bulk of TiVo's initial subscriber base, even as the company gained more dollars per subscriber with its native sales. In the most recent year, the company turned a profit of more than $100 million, after years of red ink, that had some declaring a TiVo Deathwatch, not unlike the struggles of Apple Computer just ten years prior.

The linkage of TiVo and Apple is more than just in their role as pioneers, but the pair also feature some of the most loyal customers in technology. The pair is also known for two other facets which gain alternate praise and scorn - including its penchant for secrecy and an adherence to NIH syndrome, well known in the Valley as "Not Invented Here".

TiVo's New Facebook Application, "My TV"

In June of the last year, I openly railed on TiVo to work on creating a social network to try and take advantage of its strong brand and to connect users. (See: TiVo Is a Zero On the Social Web. It's Time They Fast Forward.) And while they still have yet to follow on to my suggestions word for word, they are making strong progress in terms of showing they are actively listening and participating in the social space. The company has launched a little-known Facebook application called "My TV", which invites you to share your favorite shows, see friends' favorites, rate shows and comment on recent episodes. So it's close.

And yes, like all other good marketing companies, they are on Twitter, here: http://twitter.com/tivo. Meanwhile, although Mack doesn't consider himself a TiVo spokesperson, he has responded to blog posts of mine in the past that mention TiVo, and he is active on FriendFeed. In fact, in light of changed television programming in the last few days following the celebrity deaths of Michael Jackson and Farrah Fawcett, he posted official word from the networks there, in case you needed to make edits to your recording schedule.

Working to grow TiVo is a very interesting business. Steven walked me through the company's need to colocate in highly secure data centers in multiple geographic locations - which would ensure the service's survival, even if the state of California were to off and fall into the ocean. We also talked about the struggles that are common to most OEM businesses, where large partners see every proposed change as a potential for compromise. In particular, he recounted to me the challenge of having DirecTV's huge services team trained when TiVo started to enable broadband updates to their DVRs, in addition to standard phones - and getting the staff ready for practically any kind of modem or broadband issue.

Stephen Mack Checks Potential Issues While at TiVo

The issue of DirecTV came up a few times from others on the Web who knew we were to meet today. First, it is public knowledge that the new DirecTV TiVo boxes are scheduled for the first quarter of 2010. Secondly, the hope that DirecTV units would attain feature parity with the go to market offerings from TiVo just isn't going to happen. Units sold through TiVo will always be the first to support the latest updates, especially as partners will remain conservative.

I also talked with Stephen about the visible hacking community around TiVo's units. My first box, a hand me down, had come with a larger after-market hard drive, a common upgrade. Such modifications violate the company's user agreement of course, but the company knows such activities go on, and some smaller "garage" firms have even built up side businesses to upgrade units, which TiVo has no interest in shutting down. Most of the time, the hacks are harmless, although it was not uncommon in the DVR provider's early days to see customers load Phillips software on Sony boxes and vice versa, introducing issues.

What was shut down, however, at least for now, was the company's Rewards program, that gave TiVo ambassadors points for signing up friends and family, which could be exchanged for TiVo gear and other equipment. It turned out that rather than the program's generating a waterfall of referrals from excited fans, it turned into something of a side business for a handful of individuals, who would buy used units from garage sales, sell them to new buyers and gain activation codes, exchanging them for goods through TiVo. Mack said one such entrepreneur was making enough action that they earned themselves 500 iPods in a year (which they no doubt sold).

In the fast pace of Silicon Valley, a ten year tenure at any one company, especially one that has seen such peaks and valleys as TiVo is a rarity. But Mack says as many as a quarter of the initial 80 people at the company who were there when he joined remain, acting as historians among the company's nearly 500 employees.

The company's offices, tucked away off to the side of Highway 237, neighboring Foundry Networks, Brocade and others, feature the interior bright colors of a typical Valley startup. Its meeting rooms are all named after TV shows, and Mack offered up that he had the bright idea to name one of them, optimistically, "60 Minutes". Meanwhile, outside, even in today's heat, a vigorous basketball game was being played, featuring many of the company's system engineers, who battled in a fullcourt contest of Shirts and Skins. The scene was idyllic enough to want to take out the TiVo remote and hit pause, but I'm just as eager to hit Fast Forward and see what the next several years will bring for the technology pioneer.

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