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November 12, 2011

The Truth About Logitech “Ditching” Google TV

Logitech-Revue-3-screens


 

If you’ve read any of the news about Logitech and Google TV over the past 24 hours or so, you’ve probably already heard about Logitech discontinuing the Revue (“ditching” Google TV) and calling it a “gigantic mistake”. Unfortunately, most of these articles are just a lot of catch phrases and hype. It seems no one wants to actually read the transcript from the conference call with Logitech’s CEO. What everyone does seem to want to do is throw around the same catch phrases and rewrite the exact same story over and over on every web site on the internet. I’m here to give you a different perspective on this story.

 

First, I’d like to start by “calling out” some of these shoddy catch phrases and misguided points one by one. These same “facts” have been regurgitated all over the web- mostly because no one on the internet actually writes anything any more, they all just “rewrite” the same story on 100 different sites.

 

Did Logitech CEO Guerrino De Luca  Call Google TV a “beta product”?

Multiple news stories across the web claim Logitech’s CEO called Google TV a beta product, saying Logitech “executed a full scale launch with a beta product and it cost us dearly.” For example, Tech Radar states in their article:  “He added: “We executed a full scale launch with a beta product and it cost us dearly.”

 

But these words never actually came out of Guerrino De Luca’s mouth, then where did they get this quote?

 

They got it from a slide shown on the screen while De Luca was speaking. The words that came out of his mouth however were a bit different, although no one cared to mention this in their articles.

“Logitech Revue was launched with some, I wouldn’t call it beta properly but a software that was not complete and not tuned to what the consumers want at the living room” - Guerrino De Luca, Logitech CEO

De Luca made it a very clear point to not call Google TV a beta product when he was speaking. And although his slides made a different statement, De Luca made a very clear and purposeful contradictory statement to what was written on those slides.

 

Guerrino De Luca Logitech CEO

 Did De Luca say Google TV can’t succeed?

This was mentioned in a lot of articles across the web, claiming De Luca said “a grandchild of Google TV” could succeed, but not the current Google TV product. Let me give you an example from the LA Times: “Further, he predicted that the “grandchild of Google TV” might succeed but not the current product.

 

Now lets take a look at what De Luca actually said on this matter, it’s not anything like what is being portrayed in some of these articles:

“Google TV is a great concept, Google TV has the potential to completely disrupt living room, except that was not the case when we launched Logitech Revue.”…”Google TV or a child of Google TV or the grandchild of Google TV will happen. The integration of television in Internet is inevitable. But the idea that it would happen overnight in Christmas 2010 was very misguided and that also caused us dearly.” – Guerrino De Luca, Logitech CEO

Now this is a far cry from saying the current product can not succeed, but maybe a grandchild of it could. Perhaps it’s a matter of reading comprehension, but what I gather from these statements is that De Luca is saying Google TV could not succeed in 2010, but it is a great concept that will succeed, either in it’s current implementation or a future one.

 

 What was Logitech’s real mistake?

Every news source on the web wants to latch on to De Luca’s statements about Logitech’s mistake, and the articles make it seem that Google TV as a product is to blame when this is not the case at all. De Luca actually says that he would do it all over again, only on a smaller scale. The real mistake was that they made too many Revue’s when there wasn’t the demand for them. But, of course, this story doesn’t make for as good of a headline as something like “Logitech Says Google TV Epic Ginormous Mistake!”, now does it?

“I would do it again, I would definitely want to have Google establish Google TV, but with a significantly smaller and more prudent approach.” - Guerrino De Luca, Logitech CEO

This is just like any product in any category, if you make too many products in relation to your customer base, you’re going to have to eat them. This is true whether you’re Logitech, Apple, or the pizza place down the street.

Economic-surpluses

 

 Logitech didn’t want to be in the set top box business in the first place.

 This is a huge point from De Luca’s presentation that pretty much no one chose to quote in their articles on this subject. Logitech never wanted to be in the set top box business in the first place. The Logitech Revue was not planned to be a long term product, Logitech just wanted to help jump-start the platform:

“So, let me be very clear, it was never our strategy to make money out of set top boxes for Google TV. Our choice to build one was a choice driven by their willingness to accelerate the adoption of the platform and to be part of the first wave of people that could influence its development. We accomplished that” - Guerrino De Luca, Logitech CEO

Think about it, what does Logitech make? Keyboards, mice, web cams, speakers, remotes- they’re an accessory company, not a TV set top box company. I’m sure they had their reasons for wanting to influence the development of this platform though, and I am willing to bet it had a lot to do with accessories.

 

So what’s the real story here?

The real story, in a nutshell, is that Logitech won’t be making any more Revue set top boxes. Not because Google TV sucks, or is a huge mistake, but because Logitech is an accessory company. The Logitech Revue was an experiment for them and a way to influence the development of a new platform, but they overestimated the demand for their product and lost some money on it. Google TV not being ready for prime time in 2010 didn’t help much either. That’s the real story here, no need for these “news sites” to dog pile Google TV with misleading quotes and hyped headlines- but I guess that is what gets the “clicks”, after all.

(all quotes from Seeking Alpha conference call transcript)

 


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