TiVo's problem lies in its inability to convince consumers to change their television consumption habits. Inadequate targeting and positioning led to an ineffective product, pricing and promotion strategy that left TiVo stuck in the chasm between early market and early majority. TiVo is a truly discontinuous innovation, a product that requires consumers to radically change their past. behavior with the promise of obtaining new and equally spectacular advantages. TiVo's main challenge is to convince the consumer to purchase an expensive product in a new product category. While the early market, categorized by visionaries and technology enthusiasts, are adopting the product, TiVo has had little success convincing the early majority segment, also called pragmatists, that the risk of change is worth the reward of their revolutionary technology. This is demonstrated by TiVo's current overall market penetration level of 0.04% and poor future projections. Visionaries are not a good reference for pragmatists because of their belief in evolution rather than revolution: . TiVo can do two things to convince the early majority to buy. First, they must secure a leading position in the market. When pragmatists decide to adopt a new discontinuous innovation, they buy from the market leader. As the market leader, all other market players adapt their products to work with the leader's product. Additionally, the market leader attracts third-party companies that manufacture aftermarket products, even if it is not responsive. Second, TiVo can position its product to a target market that views the product as a 100% solution to their problem – what is usually referred to as the product as a whole. Determining the right target segment requires an analysis of the customer, the company and the competition (fig. 2). TiVo's customer is defined by unmet needs in the marketplace. Although television is one of the most ingrained and ritualistic elements of contemporary American life, some aspects of television viewing do not meet customer needs. An estimated 68 percent of Americans complained of feeling "widowed" by their significant other during the fall television season because their spouses were chained to their televisions during prime time, from 8 p.m. to 11 p.m. In addition, parents expressed difficulty getting their children to do their homework during key television program times. Overall, this shows that consumers want more control over their TV consumption habits. Analysis of TiVo Corporation reveals its core competencies, which include proprietary software, national distribution through established outlets such as Best Buy, Circuit City and Sears and co-branding of products with electronics giants trusted by Philips and Sony..