|In the Year 2008... |
...the number of DVR users is expected swell to 28.6 Million, representing one-quarter of all American TV-watching households. But few will use standalone boxes, instead receiving their DVRs through either cable or satellite TV providers.
|Total DVR Users||800K||1.6M||3.9M||6.7M||10.4M||15.0M||21.0M||28.6M|
|Standalone DVR Users||100K||300K||400K||600K||800K||900K||1.1M||1.3M|
|Cable DVR Users||200K||300K||1.3M||2.8M||4.8M||7.4M||10.8M||15.3M|
|DBS DVR Users||500K||1.0M||2.2M||3.3M||4.9M||6.8M||9.2M||12.0M|
|Source: Carmel Group|
Digital Video What?After advertising on the Super Bowl, millions of consumers learned about TiVo, but few have actually seen or used its technology. DVR units work like a clever VCR, taking a digital television signal and manipulating it in many different ways, allowing users to store shows direct to disc and even pause live television. Some DVRs, like TiVo, are part computer, able to automatically tailor options and features to individual user needs. Others, like ReplayTV, take the technology to controversial levels, allowing users to send digital copies of television shows to each other or automatically skip commercials. (For a look at how this is working out, click
Falling PricesBut by the end of 2002, Badding predicts that the number of installed DVRs will double, to 1.6 million units, with much of the growth coming from cable and digital broadcast satellite (DBS) providers. Instead of purchasing separate, standalone units, consumers will be able to get an all-in-one cable box that includes DVR as part of the package. DVR capability is already available for DBS subscribers. DirectTV has partnerships with TiVo and Microsoft's ( MSFT) UltimateTV, while EchoStar ( DISH) has paired up with OpenTV ( OPTV). In 2001, DBS users accounted for 64% of the total DVR-enabled population. By 2005, Badding estimates cable operators will have 4.8 million DVR-based users, while DBS providers will have 4.9 million. "We're already seeing this integration happen with DBS companies," he says. "It's available with DirectTV's TiVo combination box. Now it's going to be introduced by cable companies."
|The Road to Fruition |
When digital video recorders, or DVRs, first burst onto the scene in early 1999, investors were excited about the promise of something new. But three years later, the industry is awash in lawsuits as entertainment companies use the courts to protect their business and sort out difficult copyright questions in a digital age.
|Jan. 7, 1999||WebTV's DVR is integrated into satellite provider EchoStar's set top box.|
|Sept. 30, 1999||TiVo's stock debuts on the Nasdaq Stock Exchange.|
|Jan. 6, 2000||DirectTV invests in TiVo.|
|Feb. 7, 2000||Thomson Multimedia and Seagate invest in Metabyte Networks.|
|June 14, 2000||AOL invests in TiVo.|
|Jan. 7, 2001||EchoStar offers 501 series receiver with DVR capability free to subscribers.|
|Feb. 5, 2001||SonicBlue buys ReplayTV.|
|Sept. 5, 2001||ReplayTV debuts the 4000 series set top box, which allows users to skip commercials and send digital files to friends.|
|Oct. 31, 2001||Entertainment companies sue ReplayTV over the commercial skipping and file sharing features.|
|Dec. 12, 2001||TiVo and ReplayTV file countersuits against the entertainment companies.|
|Jan. 22, 2002||Microsoft announces restructuring of its UltimateTV unit and lays off 150.|
|April 29, 2002||The first DVR-enabled cable box, the Scientific Atlanta Explorer 8000, debuts.|
|Source: Carmel Group, TSC Research|