TiVo Basic will be freely included with some new upcoming PVR devices from Pioneer and Toshiba. TiVo Basic appears to offers live TV pausing, up to 3 days of show data that you can set recordings by hand, but repeat recordings are only by time and channel, with no season passes.
It sounds like it'll be software-upgradable, letting anyone with the free basic version move up to the regular version by ponying up the full monthly fee of $12.95. They're calling it a "trojan horse" form of marketing, though I wonder what sorts of conversion rates will be seen. My guess is most people buying a DVD player or set-top box that includes TiVo Basic would just stick with the included features, and that the convenience of extra features don't seem to be worth $13/month. [thanks rapunzel]