Logitech Slashes Google TV-Based Revue to $99 as Returns Exceed Sales

[MacRumors]

As noted by This is my next..., Logitech today revealed that its Google-TV based "Revue" set-top box has been a complete flop, actually recording negative sales numbers last quarter as returns exceeded new sales. In response, Logitech has announced that it will be slashing the Revue's price from $249 to a below-cost $99 and taking a $34 million charge to cover the loss.

Google TV had been seen as a major push into combining television viewing with Internet content, but got off to a rough start as Google asked manufacturers to hold off on introducing Google TV hardware as it sought to refine the software. But the Logitech Revue had already hit the market as a launch product for the concept, and has been unable to find a footing in the consumer market.

Apple has long been treading carefully in the television market with the Apple TV, and Steve Jobs noted in an interview at the D8 conference in June 2010 that the subsidized set-top boxes used by cable companies have squashed innovation in the television market.

On the future of television: "Subsidized set-top boxes have squashed innovation because no one wants to pay for separate boxes...ask TiVo, Roku, us, Google in a few months. The set-top box needs to be torn up and redesigned to get people things they way they want them. And there's no go-to-market strategy for that. With the iPhone, and now the iPad, we could partner with carriers, but television is very balkanized...everything is local.

Apple made its next attempt at the television market a few months later with the second-generation Apple TV, but even still that is primarily a hub for iTunes content with a few third-party streaming services like Netflix, MLB.tv, and NBA League Pass also being supported. Apple has repeatedly referred to the Apple TV as a "hobby", noting that the company feels that "there is something there" but that television presents a very difficult challenge for developing a go-to-market strategy.

For several years, analysts and other sources have been claiming that Apple is trying to develop its own Apple-branded television set integrating iTunes Store connectivity. The company's only public statements on the matter have, however, expressed strong disinterest in such a move given the competitive environment and low margins in the industry, but Apple has certainly been known to publicly dismiss certain ideas even as it has been working on implementing them.

Article Link: Logitech Slashes Google TV-Based Revue to $99 as Returns Exceed Sales

 

[Jerome Morrow]

Well … anyone surprised?

 

[talkingfuture]

Hardly surprising as it sounded like a poorly excecuted product. There must be a window somewhere for a product that combines Apple TV's ability to stream iTunes content with the ability to access all the services like iPlayer, 4OD, Hulu etc on your TV rather than your computer. But the broadcasters and the studios have it all tied up for now.

 

[Xenomorph]

Well … anyone surprised?

Wasn't Google TV like that Roku or Western Digital thing? Basically an Apple TV, right?

Well, that $250 price tag for something Apple offers for $100 probably didn't help.

 

[monty77]

- Give ATV the app store and everything that brings to the table (including iPlayer, 4OD etc..)
- Let other iOS devices act as controller/keyboard for aforementioned apps

...watch them sell like hotcakes.

Why has this not happened yet?!?!? Seems like a no brainer.

M

 

[hitekalex]

Yeah, Google TV is a big steaming pile of poo in its current state.. Consumer market has rejected the idea of WebTV time and time again.

No one is interested in twiddling with their 110-key remote controllers in order to send a Tweet on a Television set. Google TV product managers do not get this.

 

[mozumder]

Returns exceeding sales? Huh?

Is someone else manufacturing them and returning them to stores to cash in on returns?

how do you return more stuff than you can sell?

 

[pdjudd]

Is someone else manufacturing them and returning them to stores to cash in on returns?

how do you return more stuff than you can sell?

Possibly some were given away from Logitech or by Google.

 

[*LTD*]

They just don't get it.

Apple will open up this market to the mainstream in due course, and we'll see another radical shift.

 

[someone28624]

Hardly surprising as it sounded like a poorly excecuted product. There must be a window somewhere for a product that combines Apple TV's ability to stream iTunes content with the ability to access all the services like iPlayer, 4OD, Hulu etc on your TV rather than your computer. But the broadcasters and the studios have it all tied up for now.

I have an AppleTV and a Roku XDS sitting side by side on top of my DVD player, barely visible. They're both so small. It's a perfect combination. If only I had a few more HDMI ports.

 

[err404]

The lack of success in the TV space is not the fault of the technology companies. They have been trying many interesting ideas, but always stumble at the same point: Content. These devices will remain a niche so long as the content owners continue to deny premium content at reasonable pricing.

 

[nosaj72]

how do you return more stuff than you can sell?

I think they meant negative sales for that quarter. The ones returned were sold in the previous quarter.

 

[Bwa]

I pre-ordered the Logitech Revue and returned it within a week. It just doesn't do anything.

 

[nagromme]

I think they meant negative sales for that quarter. The ones returned were sold in the previous quarter.

Yes, or they don’t count returns AS sales. So if they “sell” 100 (maybe it was less?) and 70 are returned, they could count that as 70 returns and 30 actual sales.

 

[Aviboy97]

Um...Mr. Jobs, TiVo is pretty damn successful, as has been for about a decade now. I know cable companies have put a major dent in their sales by offering their own DVR's, TiVo is still doing pretty well.

 

[John.B]

Is someone else manufacturing them and returning them to stores to cash in on returns?

how do you return more stuff than you can sell?

They are getting more returns from sales in a prior period than they sold in the current quarter. Pretty much the worst case scenario, but what else would they expect when Google refused to actually partner with content holders?

 

[winston1236]

people actually paid 250 for something made by logitech???

 

[Jerome Morrow]

Wasn't Google TV like that Roku or Western Digital thing? Basically an Apple TV, right?

Well, that $250 price tag for something Apple offers for $100 probably didn't help.

Even if they were priced at 100 both that wouldn't have helped.

 

[cvaldes]

Is someone else manufacturing them and returning them to stores to cash in on returns?

how do you return more stuff than you can sell?

Google doesn't have any manufacturing lines, they contract out that work (same with Apple) or let someone else (like Logitech) use a reference design.

For illustrative purposes, I'll make up a plausible scenario. Logitech pays Foxconn to assemble the box for $150 apiece who then ships 100,000 of them to Best Buy stores which stocks them on the shelves for $299. 50,000 of them are sold, but 30,000 are returned by dissatisfied customers hence they have only made $5.98M in revenue (total cost $3M for a gross profit of $2.98M). The other 80,000 (20K returned + 50K still in warehouses) will be sold at $99 apiece, which is a loss of $51 per unit ($4.08M total loss). $2.98M - $4.08M = gross loss of $1.1M for the 100,000 units.

Netbooks had a very high return rate as well, and many of them are still on shelves collecting dust.

Some companies like to cover up poor sell-through rates by talking about shipments rather than sales. In this case, Logitech is forthcoming with the poor sales of this device.

By taking a $34 million loss and waving goodbye to their CEO, Logitech is admitting to their shareholders that this was an epic fail.

 

[Icaras]

Wirelessly posted (Mozilla/5.0 (iPhone; U; CPU iPhone OS 4_3_5 like Mac OS X; en-us) AppleWebKit/533.17.9 (KHTML, like Gecko) Version/5.0.2 Mobile/8L1 Safari/6533.18.5)

Um...Mr. Jobs, TiVo is pretty damn successful, as has been for about a decade now. I know cable companies have put a major dent in their sales by offering their own DVR's, TiVo is still doing pretty well.

That's certainly not what I've been reading in the news lately:

http://www.google.com/m/search?source=mog&hl=en&gl=us&client=safari&q=TiVo losing money&sa=N

 

[Sackvillenb]

Wow, it's interesting just how incredibly unsuccessful that was!

 

[T-Bone]

- Give ATV the app store and everything that brings to the table (including iPlayer, 4OD etc..)
- Let other iOS devices act as controller/keyboard for aforementioned apps

...watch them sell like hotcakes.

Why has this not happened yet?!?!? Seems like a no brainer.

M

I have my fingers crossed for an iOS 5 update to the ATV2 that includes the App Store, but I also wouldn't be surprised if Apple continues to ignore what is glaringly obvious to us ATV owners. Can you imagine the iPhone being as successful as it currently is without the App Store? I can't.

Seriously, make the hardware, put it out there, and let developers do the rest. I've jailbroken my ATV2 in order to install Plex on it, which is nice, but there's so much more that could be done with it if only the opportunity were available.

 

[ArcaneDevice]

They just don't get it.

Apple will open up this market to the mainstream in due course, and we'll see another radical shift.

No they won't. Apple are the furthest away from getting clued in.

The streaming set top box is a dead end. Apple's especially. In typical Jobs fashion their strict isolation will keep the ATV as a niche project.

I've said it before and I'll say it again - when every consumer electronics device coming to market has all these streaming services built-in, then you don't need a set top box. You only need the software.

Game console, Blu-ray player, television, cell phone ... they are all streaming content from multiple providers. Not just Google or iTunes.

Roku only survives because it's both cheap and flexible. If AppleTV had half the content providers that Roku did then it might be worth something. The best solution for Apple is to join the rest of the world and release iTunes so that it can be added as a service alongside Pandora, Vudu, Netflix, Amazon VOD, Spotify, Blockbuster, YouTube, Hulu, Qriosity, HBOGO, iPlayer, etc. etc. on every device that people are buying. Because while ATV just sits there, alone, the rest of the world is being given more and better choices that make ATV more and more unnecessary.

Just like the Revue.

 

[thetexan]

The Apple TV in it's stock form sucks. It doesn't do anything but play Netflix and iTunes content. The only thing that makes Apple TV worth a crap is jailbreaking it and installing XBMC.

I'm sure it's the same for this Logitech unit as well. It probably has the potential to be huge like the Apple TV has the potential to be huge, but it's a market not understood by anyone yet so it's lacking features people want.

 

[0dev]

This thing must have really badly implemented software on it. Seriously, how did it get that unpopular?