TiVo is seemingly embattled these days, with President Marty Yudkovitz and Chief Executive Mike Ramsay (one of the founders) both stepping down within two weeks. While some have been interpreting this as an indication that TiVo does not have a sunny future, it led me to wonder why TiVo has not been the success it should be. Part of the problem is, I suspect, that most people still don’t see the advantage of a TiVo/PVR over a VHS deck, particularly given the price difference, but more seriously I think it’s that, even among those who have a of some sort the problem of “good enough” strikes again.
“Good enough,” no doubt yet another riff on Pareto is the relevant principle here. I’d express it that, once quality/convenience has reached a certain level, the majority (80%?) won’t seek any further improvement – it’s good enough. So, for the TiVo case, any PVR provides the advantages of a PVR: random access, easy menu selection, skipping commercials etc. That TiVo has additional ‘intelligence’ to pick programming that you might like, and has recently added convenience and sharing features, isn’t compelling enough over the bundled PVR that might come from a cable or satellite company and be bundled into the cable/satellite box. (The convenience factor of a single box solution has to rank in there as well.)
In this discussion TiVo is the “Betamax” of the PVR world: generally superior technology, somewhat better signal quality and the source of innovation and development in home video recording, but the cheaper, longer recording (in the NTSC world) VHS won out because although technically inferior, it was “good enough” for most people. So despite the quality advantage of Betamax, the “good enough” cheaper format won out.
Then there’s DV which is clearly “good enough” for standard definition. Before we had DV25 (with all its known deficiencies) there was a clear way that “professionals” could distinguish themselves from the “amateurs” in production – by the format (and cost) of their equipment. DV, which is higher luminance resolution than BetaSP and only marginally worse chroma resolution, took over the majority of the production space, even with all its known deficiencies. Why? Because to most people’s eyes they could not see the difference between DV and other SD formats. Those of us in the trade see the difference clearly, but it’s not a big-enough difference to drive the finance/management types to spend the larger amounts on shooting and editing better formats. DV25 is good enough, and has serious cost benefits that it very quickly took over the production sphere for most purposes. The best available figures suggest that 90-95% of Final Cut Pro users are working with DV25 and not DVCPRO 50 or Digital Betacam. DV has 80% of the benefit for 20% of the cost and that’s a hard equation to beat – for most people.
Fortunately there will always be a segment of the market that will pay for quality and Agencies who have to pay for something, so it might as well be quality. (Agency revenue is a percentage of project budget so there is no push for lower budgets in Advertising Agencies handling large accounts.)
Which bring me to HDV – the “new” DV. From those who have seen HDV the reports vary from “totally unsuitable” to “looks great to me.” Like DV there are legitimate criticisms that can be leveled at the format for quality and compression – but the thing is, this is High Definition at a SD price and for that it’s “good enough” HD. “Good enough” and inexpensive will most probably become the dominant production format in the future, with strong growth in late 2005 into 2006. Already Sony’s FX1 and Z1R are selling like hot cakes on a blustery Winter morning.