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Digital video recording goes fast-forward

Major consumer electronics firms are jumping into the fray for digital video recording, products that will be among the first retail devices combining Net and traditional television features.

    Relief is at hand for anyone who has been plagued by a ringing telephone at a crucial television viewing moment.

    By the same token, it will no longer be necessary to decline impromptu social engagements because one forgot to tape Friends. Major consumer electronics companies are jumping into the market for digital video recording, or DVR, with the promise that these set-top box devices will trump their VCR predecessors.

    DVR products will be among the first devices combining Internet and traditional television features to hit the retail market--and more importantly, the first to offer an easy alternative to something that has become an emblem of the technologically challenged: programming the VCR.

    Instead of a traditional video cassette, DVR uses a hard drive like the one found in a desktop computer. Coupled with an easy-to-use electronic programming guide and pared-down online service, these devices can be programmed to record shows in advance. In addition, DVR is capable of pausing and resuming shows on the fly--which solves the ringing telephone dilemma.

    Several major consumer electronics companies and Microsoft are betting that this technology will be one of the next major home electronics crazes, and recent research backs them up. DVR is likely to occupy a place in as many as 1 million households by 2000--in only its second year of existence, according to a new report from International Data Corporation.

    "This is going to be big," said Kevin Hause, of IDC. Hause projects 300,000 units will ship this year, growing to 10 million shipments in 2004.

    Driving this growth is support from major consumer electronics companies, such as Matsushita, which today announced that it would manufacture DVR boxes under its Panasonic brand name, licensing technology from Replay TV.

    Under the terms of the deal, the Panasonic boxes will offer Replay's free service and will be out by the end of 1999. Replay delivers local broadcast and programming updates through a connection to a standard phone line.

    "This development significantly broadens distribution channels and, as a result, greatly widens the audience for the Replay Network Service," said Anthony Wood, founder and CEO of Replay Networks, in a statement.

    A similar deal was recently announced from rival Tivo, which is licensing its service to Philips. Along the same lines, Microsoft's WebTV is developing a set-top box with limited DVR features for satellite television provider Echostar. Satellite television is uniquely suited to DVR, Hause said, predicting similar integration of services.

    Satellites already send feeds through the MPEG-2 format, Hause explained, which is the same format that DVR uses. Thus, satellite DVR boxes do not need any additional hardware to decode the signal. In addition, because satellite TV offers so many channels, satellite viewers are more likely to take advantage of the advanced recording features.

    "It's a natural for satellite set-top boxes," he said, adding that DVR is likely to be integrated into all manner of home entertainment devices, including set-top boxes from cable television providers.

    "All of a sudden, you don't have to worry about when shows are on--it's going to be analogous to the speed with which DVD players have taken off," he said, noting that DVD players have been the fastest growing consumer electronics category in the last 20 years.