TiVo has had a long and troubled history in Canada. It was three years ago, way back in September of 2005 that TiVo extended their service into Canada, but they still didn’t officially sell units there. Users could buy units from the US and import them into Canada, but it was clearly limited support. It wasn’t until less that a year ago, in November, 2007, that TiVo became available at retail in Canada. Less than two weeks later TiVo was reported to be selling ‘extremely well’ in Canada. In March of this year TiVo was making a concerted marketing push in Canada, including in-store demonstrations.

Apparently the honeymoon didn’t last long. The ‘extreme’ sales were almost certainly due to years of pent up demand and, coupled with the rise of high-definitely, CBC News is reporting that TiVo is struggling in Canada. Unlike the US, where the FCC has mandated CableCARD for open access to digital cable, Canada has no such requirement. Like satellite in the US, cable in Canada is a closed system. If you want digital cable, including HD content, you have to use a cable company provided set-top box. In other countries, like Australia, over-the-air broadcasts still rule and digital broadcasting is actually increasing the use, but like the US in Canada cable dominates the market.

TiVo is currently selling the Series2DT in Canada, their only remaining unit that works with an external cable box. But the S2DT is limited to SD content only. And it is only dual-tuner for analog cable channels, for any digital channels it needs the external STB and it is limited to just one channel. This puts it at a disadvantage to the cable company DVRs which are dual-tuner and handle digital HD content on both. Without access to HD content, TiVo’s future in Canada will look increasingly bleak.

So what’s can TiVo do? Well, there are a couple of main options. The first is to do a deal with Canadian cable MSOs, such as Rogers Communications or Shaw Communications, similar to the deals with Comcast and Cox in the US. TiVo’s STB software could be deployed on Canadian cable STBs. Or such partnerships could see a version of the TiVo HD with built-in cable access (in place of CableCARD) distributed through the MSO as an alternative to the cable STB. That would be similar to the custom TiVo HD-based unit for Australia’s Seven Network. The issue here, of course, is getting such deals in place. It isn’t a technical issue but rather a business issue. And it isn’t clear that such deals would come together.

The other alternative is a technical solution, find a way to access the HD content from the system as it stands today. And the only real solution there would be to capture it from the HD component output on the cable box. Until fairly recently this was not feasible on a cost basis. The technology for HD component capture has existing for a while, but it is only now coming down to consumer price points. I reported from CES in January on the first wave of component input DVRs.

Hauppauge’s HD PVR USB add-on for PCs is one such example, but it is $249 for just a basic capture & encoding unit, the PC is doing most of the work. The Slingbox PRO-HD is another new device which can capture HD video and encode it on the fly, but it is similarly priced at $299.99. Now, those are retail prices, so the actual cost of the components to add such support is much less, but that’s just one input. To compete with dual-tuner DVRs TiVo would really need to add two HD input and encoder chains to the unit.

And it isn’t as elegant a solution while being more expensive. Not only would the TiVo cost more, but instead of one clean box you’d have the TiVo, one or two cable STBs, and the associated cabling and IR blasters. And if you had two STBs, to enable dual-tuner recording, you’d also have to contend with IR signal cross-talk to make sure signals meant for one STB aren’t ’seen’ by the other. Still, as I noted in my TiVo HD review, it looks like TiVo may have considered at least one set of inputs for the TiVo HD. But those were probably not meant to be HD.

Perhaps TiVo could build a Hauppauge-like external USB capture box to connect to a TiVo HD via the USB ports. Such a dongle could be useful in general for other users as well, such as those using satellite but still wanting to use TiVo for HD content. Or users of cable systems which still don’t support CableCARD (some small operators have waivers). But the real question is if the market for such a solution, more expensive and less elegant as it is, is large enough to justify the costs in producing it. It is absolutely technologically feasible, but is it economically feasible? I’m not so sure it is.

There is a third option, but it seems even more remote. TiVo could convince Canadian regulators to impose open-access rules on Canadian MSOs, as the FCC has in the US. That could take the form of CableCARD (perhaps the simplest solution as it exists and is deployable today, warts and all) or some other solution such as DCAS. But passing new regulations tends to be a very slow process with little certainty.

I think, clearly, the best solution for both TiVo and the users would be a deal with the MSOs to bring the TiVo service to them at an affordable rate without lots of extra dongles and cables.

In any case right now TiVo’s future in Canada is hazy at best. As the Magic 8 Ball says – Answer unclear, ask again later.

This is a video of TiVo’s Joe Miller demonstrating TiVo at the Best Buy in downtown Toronto.

Picked up from TiVo Blog, who was tipped to it by Davis Freeberg.

The Vancouver Sun has an article today on TiVo sales in Canada, where it was just recently introduced at retail, which is very upbeat. It has already been selling well at Future Shop:

Future Shop only got TiVo in all its stores on Tuesday, but accepted pre-orders from customers, who got a free wireless adapter with the order.

Susan Kirk, communications manager at Future Shop, said pre-orders were heavy, and she anticipates TiVo will be a big seller during the Christmas shopping period.

And at London Drugs:

Colin Cottrell, merchandise manager for electronics and audio-video systems at London Drugs, said customer reaction to the TiVo has been very strong.

“The sell-through has been incredible considering we haven’t done any advertising,” said Cottrell, who added that the first ad for TiVo appeared in a Tuesday flyer, more than a week after the stores had the device.

“A lot of customers have known about the product for several years, and don’t need really need much explanation,” said Cottrell.

“Others have heard about TiVo, and are coming in and asking lots of questions, and a good percentage of them are buying.”

“It’s been selling extremely well,” said Cottrell, who wonders if he should have ordered more TiVos on his initial order.

TiVo has to be loving this news. Even though TiVo has been available in Canada from online resellers, there are still a lot of people who buy at retail. So there is a lot of pent-up demand for TiVo that the stores are answering right now. I just hope TiVo can find a way to deliver an HD capable product for the Canadian market, as they don’t use CableCARD, so that they can continue to grow sales as the market shifts to HD over time.

It has been over two years since TiVo began supporting Canadian users. However, TiVo has never had a retail presence in Canada. Canadian users have had to purchase TiVo from US retailers, or from online vendors such as The PVR Source or PVR Canada. So Canadian support has been somewhat under the radar, I’ve regularly seen Canadian bloggers lamenting TiVo’s lack of support in Canada, and they’re invariably surprised when I tell them that TiVo does work in Canada.

Well, that’s finally changing – TiVo is coming to retail outlets in Canada, just in time for the holidays.

The TiVo Series2 DT DVR will be available in early December at major Canadian retailers including Best Buy, The Brick, London Drug and Future Shop for just $199 CAD MSRP plus standard TiVo subscription fees. TiVo will not be available in Quebec immediately. For more information on TiVo in Canada visit www.TiVo.com/canada.

It is only the TiVo Series2DT – no TiVo Series3 or TiVo HD, as CableCARD is not supported in Canada. Though, as Canada does use ATSC for broadcast HDTV, TiVo could support the S3/HD for OTA HDTV and any clear QAM channels on digital cable. It would be nice if they would – today guide data support for that is incomplete. See the press release for more info.