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After eight years at the helm, TiVo (Nasdaq: TIVO) co-founder Mike Ramsey has decided to relinquish the CEO's chair when a successor is named. Ramsey will continue in his role as chairman.
TiVo's struggles to gain market share in the digital video recorder (DVR) market that it pioneered are well documented. Last week at the Consumer Electronics Show, the company announced a host of premium services designed to compete against the ever-encroaching DVR boxes from cable and satellite TV providers.
"The time is right for me, personally and professionally, to bring in an outstanding CEO to lead the company so that I can focus on future strategy," Ramsey said in a statement.
New Take for TiVo
Analysts agree TiVo is in a tough spot and may need a leader with a different skill set.Yankee Group analyst Aditya Kishore said it's not unusual for a company to reach a stage of maturity at which the founder is no longer the best choice for CEO.
The company has faced increased pressure. Just last week, satellite TV provider DirecTV, where TiVo got about two-thirds of its subscribers, announced that it would use software from NDS Group to offer its own set-top DVR box.
Good Move?
The move could be a good one for TiVo, depending on who ends up in the CEO's post.
"If it is a person that can build bridges into the cable community and get some business for TiVo, this would be great," Van Baker, Gartner (NYSE: IT) Dataquest analyst, said.
"If they lose DirecTV or if that business goes flat and they can't get a cable company, then they will have a challenging future as a small company," he said. "They have incredible brand equity, as TiVo is now a verb in the U.S. language. They need to capitalize on this brand equity before it declines."
"Their strategy of late of adding functionality has not been unfounded,"
Kishore said. "They're heading in right direction, it just may be too late."
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