OpenTV No Longer Sees Profitability

[James_F]

According to Reuters, OpenTV said it no longer expects to achieve pro-forma profitability in the fourth quarter and does not see revenue growth in the second half. The stock is down -0.88 or -33.85% just before close.

http://biz.yahoo.com/rf/020809/media_opentv_1.html

[gcutler]

Especially with the Apps not being of much value on E* IMHO (especially the Games, which I bet they were planning on many of us plopping down $5 on). Unless the apps are much better on other systems, it all makes sense

Some people may like Instant weather, but either I get my weather on the local news (every 11 minutes on ch 11) or if not in the morning it is quicker to goto the internet. The other apps are equally as non-interesting.

[James_F]

The business model doesn't seem to work. I'd assume the weather portion would be dropped soon anyway. If people don't pay for the service, what compelling reason do they have to keep it going?

[Scott Greczkowski]

I have always felt that the Wink Application on DirecTV were better then ANYTHING I have seen with OpenTV.

I am not surprised by this news.

DIdn't I read somewhere that Dish Network was going to add Wink features in the future?

[James_F]

Here is an interesting press release about Wink. Seems like they are doing better business...

http://biz.yahoo.com/prnews/020807/sfw056_1.html

[gcutler]

I saw a show on Tech-TV about a Dot.Com bigshot that moved over to a Open-TV type company. And you listen to them talk and it is all the same as the Dot.Com mumbo-jumbo "We will earn the income by having advertising on the application..." And then there was the issue of the junky games where people would pay $5 a month to play them.

So it seems quite apparent that the Internet stupidity business models just jumped to the Interactive TV companies. I say you try to implement the 1999 Dot.Com business models twice or more after March 2000 and you goto jail for life!!! :D

[James_F]

Well I think we are seeing a movement of Tivo from subscription based revenue to ad based revenue. Between the Austin Power/Sheryl Crow ads and bundling the service with DirecTV packages, something is afoot. Maybe Tivo is trying to get out from under the OpenTV model which says, "you make something, people will buy it", rather than have a compelling product...

[gcutler]

I think the TiVo model is both user sub and ad based, they would be insane to rely solely on Ad revenus, but they also had to learn that $12.95/month was more than people would want to pay, and they know they can probably never increase the price again (relying on ads to cover additional income)

[James_F]

True, thats why combining with DirecTV is such a good idea. Let the programming subsidize the Tivo features....