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Hard Drive Video Recording to Pick Up Steam in 2005 • Major cable companies embrace DVR set-top boxes. • DirecTV moves to in-house DVR system. • TiVo grows subscriber base to more than three million. • DVR products add home networking features.
Beyond the movement to deliver new performance levels in pictures and sound, the consumer electronics industry, in association with other business sectors, is developing various interactive TV technologies that enable consumers to personalize their TV viewing experience.
Personal TV Recorders Take Hold: Alternately called digital video recorders (DVRs), these devices employ a hard disk drive, and usually electronic program guides that simplify the process of finding and recording TV programs. When first introduced, DVRs received considerable press attention and wildly optimistic reviews from industry analysts, but manufacturers found the concept was a complicated story to get across to consumers.Digital video recorders are used to digitally record programming to a hard drive that is capable of storing many hours of content at a time. This in effect creates a personal video channel containing stored favorite programs that a user can access at will. Programs typically are recorded to the hard disk using an MPEG 2 compression scheme, offering very clear pictures in comparison to analog VCRs. The unit saves the incoming live TV signal from a cable, antenna or satellite system. As the hard disk fills, oldest programs are erased automatically to make room for new content. These DVRs continuously cache all live programming, enabling viewers to pause or rewind TV shows on the fly to catch segments they may have missed or wish to view again. The technology also allows viewers to watch a program from the beginning even as it is being recorded. Although the concept has generated enthusiastic reviews among early adopters, sales were at first slow to develop, before accelerating significantly in the last year. DVR makers have attributed this to the complexity of the feature benefit story, which many consumers fail to grasp. Some object to subscription fees the DVR services require for continuously updated program guide listings.
According to CEA Market Research, the category will continue to grow in 2005, with sales to dealers estimated to climb 34 percent to 2.6 million units. That forecast includes both stand-alone models and those integrated into cable or satellite set-top boxes, but does not include sales to cable operators. Factory dollars are expected to rise to $682 million from $541 million in 2004, as average unit pricing drops to $262. Stand-Alone HDTV DVRs Arrive: Several manufacturers also shipped stand-alone DVRs, that are designed to hook up to various set-top boxes and integrated HDTV sets using digital connectors to record and playback high-definition programming on large capacity hard drives. TiVo Expects Growth: TiVo is the best known digital video recorder brand, and its popularity was proven last year, when the service said it reached a cumulative level of 3 million subscribers since its launch. The company, which distributes DVRs both as standalone devices and as integrated satellite receiver/DVRs through DirecTV, added about 698,000 new customers, 447,000 through DirecTV's satellite service, to its DVR service in its fourth quarter, which ended Jan. 31, 2004. The additions came as the service launched an aggressive growth plan in 2004 behind a $50 million marketing budget focused on doubling subscriber numbers each year for the next three years. However, changes in upper management in the company and concerns that TiVo may loose the sizeable advantage it has through its DirecTV alliance after the satellite provider moves to embrace DVR technology developed by its sister company have generated outside speculation that the company could find tough going ahead. To date, TiVo’s biggest obstacle has been the need to purchase equipment up front and pay a monthly service fee in order to view program guides needed to use the recording features. In 2005, the company is expanding its video recording function to include home-networking systems that allow multiple PCs in a home to share programming recorded on the DVR using wired or wireless connections. The new application even will allow programs to be downloaded to a laptop PCs hard drive, to enable viewing of programming on the go. In 2004, TiVo added to its basic service the ability to store and play digital music and image files from the DVR’s hard disk drive. Satellite Providers Benefit from DVRs: To date, direct-to-home satellite television providers EchoStar and DirecTV have been the most aggressive and most successful marketers of digital video recorder products and services. The majority of TiVo’s 3 million subscribers to date have been DirecTV customers, who purchase products and pay TiVo’s monthly subscription fees through the satellite company. In 2005, however, DirecTV has announced it will add to its product line-up combination satellite receiver/DVRs based on technology developed by a sister corporation – NDS. TiVo products will continue to be sold by DirecTV under a prior contractual agreement. EchoStar, meanwhile, has been one of the largest suppliers of DVRs, selling integrated receiver/DVR products which it developed, manufactured and marketed internally. Today, both satellite operators offer low-cost products that record standard definition video and more elaborate models that also store high-definition content. Some models also offer home networking capability. Cable Operators Add DVR Services: Looking to get into the DVR act, some cable operators now are offering subscribers set-top decoder boxes with integrated DVR functionality. In fact, the technology has become so popular that it has helped some set-top box manufacturers build market share over rivals that were not as prepared with integrated offerings. Cable operators, eager to stave off the competitive threat from satellite service providers, quickly moved to add integrated cable decoder/DVRs to their primarily self-distributed product portfolios. However, with the advent of the digital TV plug-and-play system, the longevity of independent cable set-top boxes is in doubt, as television set manufacturers are expected to integrate not only CableCARD decoding circuitry but DVRs into the chassis of next generation TV sets. In 2005, cable operators were expected to make some headway with their integrated DVRs by offering recorders for no upfront purchase fee, and smaller monthly surcharges than that asked for some standalone DVR services. Time Warner Cable closed 2004 with 862,000 DVR customers, up 493,000 for the year and 153,000. The MSO said DVR subscribers make up about 18 percent of Time Warner's base of 4.8 million digital cable customers. Comcast reported signing up more than 180,000 DVR subscribers late in 2004 after rolling out the products throughout its systems. The company predicts it could add 1 million incremental DVR unit installations in 2005. Similarly, Charter Communications plans to extend DVR availability to virtually all of its cable systems in 2005, after rolling out the service to about 70 percent of its subscriber base during the past 14 months. Charter reported signing up its 100,000th DVR subscriber in January, 2005. High-Definition Comes to DVR: Among the latest developments in DVRs are models capable of recording and playing back both standard definition and high-definition broadcasts. Such devices are typically integrated with a digital cable or satellite TV receiver, and include massive hard disk drives of 100 GBs or more to accept the larger data amounts of high-definition signals. HDD Recorders Combine with Other Categories: Today, many DVRs are sold in combination boxes, usually married to a digital satellite TV receiver or digital cable converter box. Incoming signals are stored directly to the hard drive in bit stream form, making for a cleaner picture and more efficient use of disk space. Additionally hard disk drive (HDD) recording has moved into the audio space as home jukeboxes capable of storing many hours of music in various compression formats. Hard disk recorders are split into two classes. The first class, such as those produced by DVR developer TiVo, includes intuitive programming software that monitors users' viewing habits to record programs automatically that match their preferences. Alternately, this intuitive system can be shut off or can make selection suggestions without actually recording the program. The second type relies on the user to manually program the unit to record all programs. DVRs Integrate In-Home A/V Networking: Companies view new generation models due out in 2005 as true digital in-home network servers. A new feature enables greater flexibility as a home-networking tool. Among other things, the function enables sending programs recorded to a unit's hard drive to a connected television in another room in the house. Eventually, similar devices will find and record programs to hard drives for a 24- to 48-hour viewing window, and then if the user desires, the program can be archived for future play on DVD-R discs in a connected jukebox recorder. These jukebox servers, as some call them, would act as central hubs to other devices throughout the home, each connected to the other through wired and wireless infrastructures. Servers Serve up DVD Videos: The first manufacturers offering video servers hit the market in 2004. These devices incorporate massive hard drives that let consumers store their entire movie collections internally. These devices incorporate a server, movie player and DVD reader, and provide access to any movie in the collection from any viewing zone in the house. In addition to videos, most models will store and playback other entertainment media files. Video servers typically use a proprietary operating system with encryption that encodes the signal. DVDs can be imported bit-for-bit in native MPEG 2 compression, including copy protection. Through the operating system, hardware components stationed throughout a home can communicate with each other using an Ethernet connection. Built-in movie guides are delivered via the Internet.
Source: The Carmel Group, 1/05 Video-On-Demand Offers Convenience, Selection: |
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