The service, called Mystro TV, allows customers to record and control TV shows through their digital cable boxes. Mystro TV also lets viewers pause, fast-forward and rewind live TV shows and will offer a digital program guide to schedule recordings, the sources said Monday.
Unlike TiVo, Mystro TV is not a local device with a hard drive. Instead, all recordings and controls will be hosted by AOL Time Warner in a central data bank and delivered through the digital cable pipe. The video will not be served through an IP (Internet Protocol) network, meaning it will not be Internet-based.
Mystro TV is still in development and is expected to be released within two years, the sources said.
AOL Time Warner spokeswoman Tricia Primrose declined to comment on Mystro TV, but she said the company has "a group looking into interactive TV."
Details of Mystro TV, first reported by The New York Times, highlight the growing interest among media and entertainment companies to find legitimate uses for a technology blossoming in popularity. Although the entertainment industry has shown interest in digital recording devices, the technology's effect on businesses has caused concern among many.
Movie and TV studios, broadcast networks, advertisers and media conglomerates worry that digital video recorders such as TiVo will make it easy for people to skip commercials with a click of the button.
One source close to Mystro TV said the service will alleviate those concerns by including advertising in the service. For instance, a viewer who pauses a live broadcast may see an advertisement before resuming. Skipping 30-second ads will be barred as well.
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AOL Time Warner has had a difficult time trying to combine its massive content and broadcasting assets with the interactive capabilities of its AOL division. Last month, AOL confirmed the, which was originally launched with the intent of adding TiVo's software into future versions of the device. However, AOL and TiVo their financial arrangement last May, foreshadowing plans to scrap AOLTV.