Rebates seem to be a way of life for gadget loving shoppers, although I've never heard from someone who enjoys waiting for their savings to come in the mail. Over on the TiVo Community forums, TiVo Customer Support Program Manager Bill Dailey explains why TiVo uses rebates:
As to the idea of just lowering the price rather than offering a rebate, rebates are used for a couple of reasons (by just about every consumer electronics company out there):
1. Not everybody claims them. The fact that only a certain number of people will complete the rebate paperwork is figured into the cost of a rebate. Lowering the price would have a much larger financial impact than a rebate, likely making it impractical.
2. Just having a rebate drives people to buy products. Lowering the price $100 does not have the same effect as having a $100 rebate. People buy more products when there is a rebate - regardless of if the final price would be the same either way.
Above Dailey's post, another forum member points out that because not everyone redeems their rebates "if TiVo was going to drop the rebate, the price would drop by less than $100." Which would you rather have: a $99 TiVo with a $100 rebate or, for argument's sake, a $150 TiVo?