Stand-alone PVRs lonely

Gary Arlen loves his ReplayTV personal video recorder.

“But I bet I haven’t plugged it in for more than a year now,” says the Maryland-based president of Arlen Communications.

It’s not broken. The stand-alone ReplayTV box, which uses a hard drive instead of tape, can still record and store hours of television programming. And, like machines from competitor TiVo, it can pause live television and zip through commercials.

No, it was Arlen’s satellite TV service that rendered his ReplayTV unit obsolete. Last year, EchoStar Dish Network produced its own PVR machinery, added it to its receiver box, then offered it virtually free to entice subscribers.

“It’s really a no-brainer,” says Arlen.

The displacement of Arlen’s stand-alone PVR is more than happenstance.

With its line of PVR satellite receivers, EchoStar surpassed TiVo to become the market leader with 45% of the 1.5 million in use at the end of 2002. And, analysts say, satellite and cable companies will join the makers of DVD players, media center computers and other electronics in adding PVR functions to their equipment.

It’s not a pretty picture for stand-alone box makers such as TiVo and ReplayTV.

When they debuted in the tech boom days of 1998, the two companies seemed destined to slug it out with products from America Online and Microsoft. Instead, Microsoft has shuttered its UltimateTV, AOL-TV has left the market, and ReplayTV has been sold in a bankruptcy auction of parent SonicBlue.

“I’m afraid they’re becoming obsolete,” said Adi Kishore, an analyst with the Yankee Group. “I think if you’re a consumer right now, you probably don’t want to get a stand-alone box.”

Time Warner Cable in Milwaukee is offering its own version for only $5 extra a month, a cost more attractive than today’s cheapest PVRs (about $250 or more, plus at least $250 for a lifetime subscription to electronic programming guide updates). Even now, EchoStar customers can upgrade to a PVR for a one-time fee of $150; new customers can get one for $50.

Those who already own a PVR can still use their units, spokesmen for the makers say. ReplayTV, for example, is selling three models ranging from $250 to $450. The company says it is committed to continuing service indefinitely but will increase its one-time subscription fee to $300 on June 1.

TiVo, which has about 625,000 subscribers, says it expects to approach 1 million customers by year-end. Still, that is a long way from the mass-adoption “TiVolution” anticipated by its ardent fans. And, say analysts, the low sales figures reflect the difficulty that stand-alone PVR makers have had in generating interest.

Source: The Milwaukee Journal Sentinel

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