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Summary:

A lot of times, companies fail by not embracing new technologies quickly enough, but Logitech’s Google TV debacle might be just the opposite: The company bet aggressively on technology that consumers weren’t quite ready for. That mistake in timing cost Logitech upwards of $100 million.

logitech revue

A lot of times, companies fail by not embracing new technologies quickly enough, but Logitech’s Google TV debacle might be just the opposite: The company bet aggressively on technology that consumers weren’t quite ready for. That’s the takeaway from comments made by Logitech CEO Guerrino De Luca at the company’s Analyst and Investor Day.

A mistake of implementation

While admitting that the Logitech Google TV was a mistake, De Luca was clear it wasn’t a mistake of intention or strategy, but one of implementation. In his comments, De Luca reiterated the belief that “Google TV or a child of Google TV or the grandchild of Google TV will happen,” and that “the integration of television and Internet is inevitable.” In other words, it wasn’t a question of whether or not the convergence of TV and the Internet will come to be, but how soon it would occur.

“The idea that it would happen overnight in Christmas 2010 was very misguided and that also cost us dearly,” he said.

Of course, Logitech isn’t the only company to suffer from being ahead of its time on a certain product or strategic initiative. Just think of Apple’s Newton tablet or the tablet PCs that Microsoft showed off long before the iPad changed the computing industry. Heck, the Logitech Revue and the first iteration of Google TV are far from the first failed efforts at interactive television: Fifteen years ago, WebTV launched to bring the Internet to TV.

For Logitech, the expectation that consumers were finally ready for this brand new experience was misguided. “It’s always the case people will tend to overestimate the short term and underestimate the long term,” De Luca said

Google TV not complete at launch

It’s not just that the timing wasn’t right, but also that the Google TV software wasn’t quite ready for primetime. De Luca stopped short of calling the initial Google TV operating system “beta software,” but acknowledged that it wasn’t complete and not “tuned to what the consumers want at the living room.”

One big failure was the way in which users interacted with the Google TV interface: a problem that wasn’t helped by the clunky input devices that CE manufacturers offered with products that supported the TV OS. In Logitech’s case, that was shipping the Revue with a keyboard and trackpad that made navigating the TV tricky. And Sony, which had its own line of Google TV products, shipped with a monstrosity of a remote that was more confusing than useful.

But the Internet-enabled content also wasn’t there at launch. While the introduction of a Flash-enabled web browser built into Google TV initially gave some users hope that they’d now be able to watch all the same online video content on their TV that they enjoyed on the desktop, the reality was that premium content owners quickly moved to block access to their videos on the device.

The price wasn’t right

Finally, Logitech overestimated the price consumers would be willing to pay for the Google TV experience. It wasn’t alone in this regard; Sony TV and Blu-ray units with Google TV were priced at a premium as well. However, asking consumers to pay $300 for an Internet-enabled set-top box when Apple TV and Roku sold for $99 was a non-starter. DeLuca said that heavily discounted units are selling now, but they’re also selling at a loss: Logitech’s cost of materials for the Revue is well above the $99 that it’s now asking for the device.

With a $100 million loss attributed mostly to its mistake with Google TV, Logitech is in no position to double down on the platform. While it hasn’t given up on supporting future versions of Google TV, De Luca said he’s optimistic that the operating system will catch on, but isn’t willing to bet the company on it. For now, that means running out inventory on its existing box and taking a wait-and-see approach going forward.

  1. It’s worth remembering that Google and Logitech both promised access to Google Market in January. Of course, they didn’t say which January. It’s still not there!

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  2. Is Honeycomb coming to Revue?

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  3. Tweet today from Google:
    GoogleTV Google TV Team
    Those of you who can’t wait for our big software update to reach your Logitech Revue, stay tuned! It’s coming in the next few weeks.
    1 hour ago Favorite Retweet Reply

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  4. Google TV was destined for failure from the day it was pre-announced. When the Google, Intel, Best Buy and Logitech CEO’s stood up there and stated “we will ship in September (2010) for the holiday shopping season”. This classic management error put tremendous pressure on all teams to release the product regardless of value proposition or user experience.

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  5. http://blog.logitech.com/2011/11/11/the-next-version-of-logitech-revue-with-google-tv-due-before-year-end/
    Logitech Blog today
    “We are very excited about the new release of Google TV, which includes access to the Android Market, faster and more comprehensive search capabilities, a simplified user interface and improvements to the Logitech Media Player. And we are optimistic about the long-term opportunity for the Google TV platform and the potential for Logitech to offer associated products as the ecosystem evolves.”

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  6. Quite annoying since I just bought a revue yesterday, then heard this today. Also noticing only about 25% of the small amount of things on it work. I bought this in anticipation of google tv 2.0, now I’m pretty sure I should return it.

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  7. The concept was flawed from the start.

    The gen consumers do not want to fiddle with buggy incomplete and complex software when they’re in lean-back mode watching TV. And certainly don’t want to think of having a cumbersome keyboard and mouse in the living room, with a big mouse pointer for clumsy onscreen navigation. The whole concept was flawed from the start, even before the launch of GoogleTV beta (WebTV, AOLTV). Both Google and manufactures like Logitech is at fault here. It’s like the blind leading the blind.

    With smart phones and tablets usage skyrocketing at the home, why would consumers choose instead to surf the web on their TVs from across the room? Disturb a show thats playing to post a twitter messages or Facebook a friend on the TV, with keyboard and mouse in hand? That’s why we have the smart phones and tablets like the iPad sitting on the coffee table. Search for a show on the iPad (i.e. Comcast app, HBO app) and simply send it to the TV of choice around the home (AppleTV + Airplay). Found something funny on your YouTube and want to share with the family, send it to the TV. Have a multi-player game wirelessly mirroring from the iPad to the TV (think party setting). The TV should be just another accessory in the home connected to our ever growing smart devices, not the main driver.

    Plus with the content providers continuing to block GoogleTV from broadcasting their web shows, what’s left in terms of value for consumers? Netflix? Consumers can get Netflix on multiple cheaper devices like Roku, Wii or Blu-Ray players etc.

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  8. Indeed this is a sad news. It would be nice if their TV software would work. Truly a great addition in our entertainment.

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  9. @kattriley no firsthand experience but my sense from fellow #websereies folk was mixed. this article has some insight http://t.co/o7O2Jxmj

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