Americans
Embracing
Digital Video Recorders
U.S. television
viewers increasingly adopting the digital video recorder
(DVR) as a replacement for the tape-based VCR.
by Judah Ken Freed,
"America Watch" columnist in
Euromedia.
American
TV viewers are thowing away their VCR cassette tape
machines. They've found something better.
The hard-disk DVR
technology, also called a personal video recorder (PVR),
is being deployed in the set-top boxes of cable and
satellite operators, plus appearing in stores as a
stand-alone consumer electronics product. Now capable of
recording HDTV content, DVRs soon will be incorporated
into digital TV receivers.
All DVRs record
video onto a hard disk similar to those in personal
computers. The size of the disk varies. A model with a
250 Gigabytes disk permits a DVR to record 25 hours of
high-definition TV programming or 180 hours of standard
definition programming. The more advanced boxes, like a
recent version from TiVo, can record up to 450 hours of
video.
According to
Forrester Research, DVR boxes are now in about three
million U.S. households.
Leading the charge
is TiVo, with about 1.35 million customers through an
alliance with DirectTV and a growing retail base. Next is
ReplayTV, which confirms an estimated reach of less than
a half million customers. Both services today require one
PVR per TV, although TiVo allows its single-tuner boxes
to be networked for recording multiple shows at once in
separate rooms.
Both TiVo and
ReplayTV charge a low monthly subscription fee of USD
$4.95 or a lifetime fee of USD $299. The fee gives
customers access to the TV schedule database of Tribune
Media, used to search for content to record by such
variables as program title, timeslot, genre, actor,
director, and descriptive keywords.
EchoStar
Communication manufactures three models of DVR-equipped
satellite receiver system for the Dish Network, including
two models that can record HDTV. EchoStar is not
reporting the percentage for PVR adoption among it's 9.5
million customers.
Cable operators
only recently began rolling out DVRs in their advanced
digital set-tops. While no industry-wide numbers are
being reported, Scientific-Atlanta reports shipping
324,000 units by the end of 2003. The latest cable box
offerings from vendors like S-A, Motorola and Pioneer
feature dual-tuner, multi-room DVR servers with HDTV
recording capabilities, so only one DVR box is needed.
They market these DVRs as part of a home networking
solution.
Farther back are
the stand-alone DVR consumer electronics products, which
can plug into any satellite and cable box or else record
broadcast signals off air. Among these are some
start-ups, such as Denver-based Interact-TV, which sells
a PVR based on the Windows Media Player. The next wave of
retail products, like those being developed by
Thomson-RCA and Panasonic, integrate hard disk recorders
with optical disk DVD recorders, allowing consumers to
record and archive digital recordings within the same
box.
"2004 has been the
most exciting year since ReplayTV launched five years
ago," said Bill Loewenthal, VP of product marketing for
ReplayTV, now owned by D&M Holdings but still based
in Santa Clara, CA. "We expect the whole category to
double this year of last."
"Digital video
recorders seems to be gaining so much traction in the
marketplace because the cost of hard disks keeps coming
down," said Brodie Keast, senior VP and general manager
of TiVo Inc., based in Alviso, CA. "When we introduced
the PVR category in 1999, a 30-hour TiVo box from
Phillips cost $1,000. Today you can buy a 450-hour DVR
for only $150. Each time we lower the cost, we see more
demand growth."
"We were battling a
couple of things toward the end of 2002," said Randy
Staggs, general manager of global video products for
Thomson Electronics, the French company that manufactures
the RCA line of TiVo-enabled DSS satellite receivers for
DirecTV. "First, the product category suffered from a
widespread lack of consumer understanding of the true
benefits from the DVR. Second, there was an inability to
communicate the value proposition effectively in a short
time on the retail sales floor."
"Market awareness
has changed dramatically" said Dave Davis, VP of
strategic planning and product marketing for subscriber
networks at Scientific-Atlanta, based in Atlanta, GA.
"Five years ago, the product was only available retail
and it was expensive. Today DVR services are available
and being marketed to more than 20 million cable homes
for as little as five or ten dollars a month. People are
willing to try it to see if they like it."
"Demand is
increasing as people see PVR boxes in the homes of their
friends and neighbors," said Dan Ward, director of
marketing for cable and communications at Pioneer
Electronics in Burbank, CA. "DVR boxes are selling like
hotcakes because people really love the experience. We're
especially seeing consumers clamoring for the combination
of multi-room networks with HDTV recording."
"Were thrilled by
how the PVR has taken off as part of a complete home
entertainment package," said Keast. "We are confident
that the technology is not going away.' 
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