Last quarter Tivo got around $20,000,000 in lifetime subscription signups.
oh really? that's very curious, since their total service revenue for the quarter was less than $33 million.
Don't confuse lifetime signup cashflows with revenue. If you double-check Tivo's latest results (under "cashflows from operating activites" for the past quarter - ended Jan 31 2005), you will see:
" Deferred revenue 19,690"
That's $19,690,000 in deferred revenues = the non current portion (~47/48ths) of newly lifetimed units.
Also, I think you are mixing quarters. Standalone additions in the last quarter was not 65-75k units. It was closer to 250,000 IIRC (if you take $19.7 million and divide it by the $300 lifetime tag, you see that about 66k units, or 25% of new standalone Tivos, opted for the lifetime option.)
Allen alluded to this when he said I might be talking about revenue. Acutally, I was talking about cash. Tivo was paid $20 million in cash by new subscribers lifetiming their units. Only a tiny fraction of lifetime subscription money gets counted as revenue (1/48th of it), and during the quarter of activation, even less will get counted (perhaps 1/100th or so, depending when in the quarter the activation took place).
so the figure you stated--20 million in "lifetime subscription signups"--seems overstated by a factor of more than 15.
Please check for yourself. You may stand corrected.
percentage of "recurring revenue" (as opposed to lifetime subscriptions) increased YoY from 40% to 50%. that is a 25% increase in the share of recurring revenue. in other words, as Tivo adds more subs, a smaller percentage are opting for the lifetime option.
You are 100% correct. As I posted above, it looks like the number was closer to 25% last quarter (IOW, 75% of new standalone subs are opting for month-to-month). However, as a business would you rather have a new lifetimer (revenue generated: $6.25 per month for 48 months) or a new standalone subscriber (paying $12.95 a month)? If I were the CEO I'd want a mix of both types, on the one hand appreciating all that non-refundable cash coming in but at the margin preferring the new month-to-month sub, which is no doubt more valuable to me than the lifetimer. In other words, if I'm Tivo, I want to see that lifetime adoption rate drop but not to zero, at least not while I need cash to expand my business.
and "free" is a pretty good price compared to $300, or whatever the monthly fee is.
Apples to apples please. Unless Microsoft is giving away media center PCs and/or extenders for free.
Andre |
