TiVo vs Microsoft: The Future Battle Over Connected Home Entertainment

By Alexander Grundner | January 30th, 2004

There has been a lot of talk floating around about TiVo’s acquisition of Strangeberry, “a small Palo Alto based technology company specializing in using home network and broadband technologies to create new entertainment experiences on television. Strangeberry has created technology, based on industry standards and including a collection of protocols and tools, designed to enable the development of new broadband-based content delivery services.” People from Slashdot and PVRblog are getting overly excited about a picture that has been posted on frackers.com, which is nothing more than three popular Network Media Adapters (devices that hook into a home network and can stream digital media content from a PC to a TV and/or Stereo) that were supposedly purchased by Stangeberry developers. This picture has lead to Mike Haughey, of PVRblog, to speculate that TiVo will be “producing home broadband boxes that did everything from act as a firewall and wireless router, to home filesharing and IM, to callerID/tv/movie/weather updates on your TV, all in one simple box running a linux port. It would seem like a great move for TiVo to pick something up like that and bake it into their boxes, making TiVo customers less likely to jump ship for a free PVR from a cable company.” In my opinion, the idea is close, but can be expanded even further.

On the other hand, Om Malik, of GIGAOM, feels that the “Strangeberry folks [are] developing an application for home networks–something that can detect all of the devices on the network and interact between them, maybe something that would let you control your Internet home gateway, PC, TV, stereo, etc. from one remote control device. Of course since more and more companies are supporting the high speed Wi-Fi networks and some are even contemplating streaming video wirelessly using the super speeds offered by 802.11g implementations, it does not seem that far fetched that Strangeberry came up with this killer app.” He also goes on to mention that the San Jose Business Journal posted and article during CES 2004 “TiVo announced new development partnerships with digital photo and music companies XM Satellite Radio, Adobe, MoodLogic and Picasa that it said will expand the features and capabilities of the TiVo service.”

If you connect all the dots, to come to a speculative conclusion, the partnership with Strangberry will lead to a device, coupled with a possible TiVo compatible Media Adapter, that will give Windows Media Center (WMC) a run for its money. You might be wonder, what is he talking about? But hear me out. This is the exact same market Microsoft is going after. Microsoft’s intention is to partner with content and service providers to offer entertainment services via WMC. Moreover, they want to easily distribute this content around the house using Windows Media Extender technology, empowering XBOX and other WME devices to stream native PC media content and paid services. If you think about it, this model will work out quite well for Microsoft in the long run. However, TiVo is no dummy. It currently has one of the best implemented, easy-to-use DVR user interfaces on the market, but it knows it faces a shaky future. If positioned correctly, TiVo has a fighting chance to give Microsoft some pretty hefty competition.

Possible future TiVo scenario:

A no PC required Digital Media Server that is digital video recorder, broadband entertainment content/services device, and a home network digital media streaming device all in one. Moreover, TiVo will introduce accompanying Network Media Adapters that will be able to stream the content from the TiVo server (and from network PCs) to other rooms in the house; as well as, be able to remotely program the TiVo server to record television programs and order on-demand services like movies, music, games, etc.

The above seems like the most logical step for the company. If they haven’t thought about it this way, then I’m available for consulting.