The demise of the VCR wasn't entirely the fault of the DVD player. TiVo's introduction of the digital video recorder to home users offered a newer, smoother way to record their favorite shows — without the headaches that came with scheduling a VCR recording. The DVR also proved to be a thorn in the side of the adverting industry, by letting consumers skip through commercials in 30-second intervals.
TiVo, TIVO,came with a premium pricing model, though, which slowed its expansion and prevented even temporary dominance, giving other set top box manufacturers time to began incorporating DVR technology into their specifications. Thus, TiVo was a victim of its own innovation.
DVR adoption went from 1.2 percent of all U.S. households in January 2006 to 42.2 percent of all viewers in February 2011, according to ACNielsen.
"TiVo is a classic case where an innovator arrives on the scene and causes disruption only to see its own business disrupted a few years later," said Steinberg. "Had it partnered with other companies like the telecoms, it would have been able to scale much more rapidly and much more quickly and entrench itself in homes across America."