Digital VCRs Fight for the Hearts of Viewers
April 21, 2001 - 0:0
SEATTLE/SAN FRANCISCO Imagine this: The television is running, and your favorite show gets underway. But then the phone rings in the home office. Do you miss the show, or live with the possibility of never finding out who called? According to DPA, a new technology dubbed TIVO is poised to make that decision easier. With it, you would simply press the "Pause" button on the remote control and answer the phone. After hanging up, you would press the "Start" button and continue watching the show right from the place where you left off, as if you had never gone away. This is the vision of an entertainment technology that is already reality in the United States. The magic words for this completely personalized television lineup are "Personal Video Recorder" (PVR) and the "TIVO" subscription. With it, you would see exactly what you want on television -- and exactly when you want to see it. Undesirable blocks of advertisements could be skipped at the push of a button. The digital PVR recording device has room on its hard drive for some 60 hours of television, and hard drive capacity is expected to grow to be able to include 250 hours of television in the near future. With it, you will be able to record all of your favorite programs and even tell the device to record all programs that feature a preferred actress, for example. In the event of unscheduled changes to the broadcast lineup, the PVR searches out the most current listings on-line. After initial problems getting launched, the business of digital recording is now slowly picking up steam. In the fourth quarter of the past year, the number of digital recording customers rose over 85 percent over the prior quarter, from around 73,000 to around 136,000 in the United States. This was still a significant step back from the projected goal of 800,000 units, as once projected between TIVO and their competitor ReplayTV. Fewer than 400,000 of the PVR devices passed by the registers at electronics shops, reports the market research firm Carmel Group. In Europe, the first attempts at rolling out this product were foiled by the manufacturers' cautious approach. Yet a certain necessary cooperation between the manufacturers and the service providers was also missing. The Dutch electronics firm Philips, which is working together with TIVO Europa to create equivalent devices for the British market, will present a proposal for the German market at the upcoming International Broadcast Exhibition -- albeit without the "smart capability" of the American model. "We could bring the PVR onto the market at any time, but without the correct service infrastructure in place, it makes no sense," says Klays Petri of Philips. More market research and significant customer education are still needed before the introduction to the market can happen, he indicated. The devices sell for around $400 in the United States, and a TIVO subscription costs an additional $10 per month. The service provider, which is partially owned by Internet service provider AOL, in the past year caught up to and surpassed its competitor ReplayTV. The Internet media firm Sonicblue, which brought the Rio MP3 player onto the market, has since bought ReplayTV for $120 million. "We are now expanding from innovation in the realm of digital music into innovations in digital video offerings," says Andrew Wolfe, technical director of Sonicblue. Back in 1999 when the digital video recorder first made its way into the headlines of periodicals like the *** New York Times ***, the talk was of the threatened end of private television companies. The PVR was supposed to make it possible for the viewer to avoid commercials. Television advertisers would pull back from the market, and the main source of income for television stations would then dry up. This disaster scenario for the major U.S. networks -- ABC, CBS, NBC, and FOX -- hasn't yet materialized. Instead, now as before, it is questionable whether millions of customers will want to lay out money for an expensive digital device, when for around $100 they can buy a traditional VCR. It's true that these "old" devices still involve cassettes and fumbling with programming menus, but with a little bit of effort, viewers can set up a personal program as well.