Logitech's Google TV-Equipped Revue Generates Negative Revenue

No company wants a product that's returned more rapidly than it can sell them, but that's what Logitech reportedly has on its hands with the Revue. Logitech executives have stated that the Revue's revenue stream is "slightly negative," and the company has slashed prices from $249 to $99, reportedly in a bid to clear inventory (the unit is still listed at $249.99 on Logitech's homepage).

We launched Revue with the expectation that it would generate significant sales growth in spite of a relatively high price point and the newness of both the smart TV category and the underlying platform,” Logitech chairman Guerrino De Luca said in a conference call on Thursday. “In hindsight, there are a number of things we should have done differently... There was a significant gap between our price and the value perceived by the consumer."

The Revue offered plenty of connectivity, but consumers evidently weren't sold on the price tag or feature set

Growing pains were inevitable. No one has ever successfully unified television and the Internet; Microsoft's Web TV ultimately became a cautionary tale for anyone trying to build a mass market device in the combined niche. Television technology has advanced tremendously in the past decade, but content creators have become a major roadblock to any company seeking to build an IPTV service. The likes of Comcast, Time Warner, and Verizon are adamantly opposed to the idea of serving as dumb pipes and view any attempt to market content to viewers via the Internet as cutting into their own advertising-based revenue streams. A number of broadcasters have prevented Google TV from streaming content from their sites, while Hulu has similarly closed its virtual doors.

The Revue's reviews, meanwhile, weren't flawless. While a number of writers praised the box's overall capabilities, it quickly acquired a reputation for being more difficult to configure than some of its competition. Logitech may have been too optimistic regarding its price points; there's always been debate over whether or not the Revue offered enough value to justify a $249-$300 price tag, particularly since anyone who wanted to use the video phone feature had to drop another $149 on that peripheral. Given the number of HDTV's now selling under $1000, consumers may have been turned off at the idea of paying so much for an unproven product.