Personal video recorder (PVR) technology took a big step toward mainstream acceptance last week when personal-TV supplier ReplayTV, cable operator Charter Communications, set-top manufacturer Motorola and investment firm Vulcan Ventures announced plans to integrate hard-disk recording into digital cable set-tops.
The joint venture, code-named Project DISCO, will create a set-top platform capable of storing video, audio and Internet content, a base functionality Charter calls digital video recording (DVR). Motorola will use the proposed platform to build a DCT-5000 digital set-top with hard-disk storage, while the venture firm plans to license it to any interested set-top manufacturer or cable operator.
Terms of the agreement, which was announced by Charter President and CEO Jerry Kent at a Goldman, Sachs investment conference in New York, were not disclosed.
Although ReplayTV and competitor TiVo have enjoyed early success with retail PVR devices made by Panasonic, Philips and Sony, both have maintained that they are in the software business, not the business of selling boxes.
Therefore, ReplayTV and TiVo have considered partnerships with DBS and cable companies as the most likely way for "personal television" technology to reach the masses. The two-way broadband connection that a digital cable set-top provides-in contrast to the phone line connection ReplayTV and TiVo boxes use today-dramatically enhances the potential for targeted interactive commercials and e-commerce.
TiVo and DirecTV are already developing a combination DBS receiver/PVR that should hit stores this fall, and TiVo has announced plans to integrate its PVR functionality into the AOLTV broadband set-top that will debut next year.
TiVo's and ReplayTV's retail boxes are being deployed by Comcast Cable, and ReplayTV is also being tested by Time Warner Cable. TiVo and ReplayTV have struck interactive advertising deals in which they create branded areas within their electronic program guide and preload promotional material onto the hard drive before shipment. Those advertising deals are only a harbinger of the advertising future, says ReplayTV Chief Technical Officer Dan Levin: "We'll be providing our MSO partners with exciting new revenue streams on future types of advertising."
For now, ReplayTV is bringing its software expertise to the creation of the new reference platform, says Jim Henderson, Charter vice president of corporate development and technology. Charter will provide its distribution capabilities and knowledge of the MSO marketplace, Motorola will leverage its manufacturing power, and Vulcan Ventures will add key intellectual property from its Interval Research subsidiary.
Henderson makes clear that Charter has not committed to deploying a full-fledged ReplayTV service to its subscribers, and says the reference platform will have open software interfaces that will allow it to be used with any personal-TV service, including TiVo's.
"There's a difference between the DVR and PVR," says Henderson. "DVR means the set-top's equipped with the capability of accessing a hard drive, doing fast-forward, play, etc., with associated channel information as with a VCR. With the PVR, you add applications that are either headend-based or client-based, for a more personalized, integrated service."