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B U S I N E S S
Today's Headlines
2:00 a.m. June 8, 2002 PDT

Make Love, Not War Games

NASA Takes a Flyer on Hydrinos

Craig Gets Listed in Replay Suit

ReplayTV Users Sue Hollywood

House Probes Insider Trading

Cursor Company's Conduct Cursed

TiVo Town or Sonicblue City?

No Bull: Tech Funds Are a Bear

Britain Bans Xbox Ad

Playboy Goodies Go Big

Did MS Pay for Open-Source Scare?

Fuel Cell Car Coasts Across U.S.

More ...
 TiVo Town or Sonicblue City?
By Farhad Manjoo



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2:00 a.m. June 6, 2002 PDT
The battle is not yet fierce, but the warning signs are clear. There's a new product war on the horizon, one that could make the Cola War and the Browser War look like mere playground scuffles.

Call it the DVR War, the battle over which company -- TiVo or Sonicblue, the maker of the ReplayTV -- will come to dominate the future of digital video recorders, and, perhaps, the future of TV.

See also:
•  ReplayTV Won't Quit, Won't Quit
•  Sonicblue Freed From Monitoring
•  Napster Now Bertelsmann's Baby
•  They Know What You're Watching
•  Lights, Camera, Hollywood Tech
Digital video recorders aren't new, but after a slow initial rollout they're trending to become hugely popular during the next few years, according to analysts. Some predict that in the next five years there'll be tens of millions of DVRs -- which allow television watchers to pause, fast-forward and easily record TV shows, letting them watch TV the way network programmers never intended them to watch TV.

But complicating this TV utopia are the media companies wary of losing precious ad revenue once passive couch potatoes become active DVR-equipped ad-skippers. And this is where the product war comes in.

TiVo and Sonicblue have taken divergent approaches in their attitudes toward content companies.

TiVo has been accommodating the firms, teaming up with broadcasters and advertisers to offer special TiVo-only "advertainment" (the company's own word). Sonicblue, meanwhile, has added features to its DVR that are so offensive to media companies that several have banded together to sue ReplayTV into oblivion.

Sonicblue won one round of that suit this week, when a federal judge declined to order the company to monitor its thousands of ReplayTV users, as Paramount, Universal, Disney, CBS, ABC and NBC had requested.

At its heart, a DVR is only a hard drive with an electronic TV guide, a machine that digitizes an incoming TV signal and records it on the drive, so a user can play it back whenever he wishes. Both TiVo and ReplayTV allow users to pause, fast-forward and automatically record TV shows for future playback. But ReplayTVs are broadband-enabled, meaning that users can trade shows with each other -- including pay-TV shows. Also, the system features a button that skips ahead 30 seconds at a time, allowing much quicker ad-skipping than on the TiVo.

Sonicblue says that its features are there only because consumers want them.

"Customers are intrigued by the concept," said Andrew Wolfe, Sonicblue's chief technology officer. "And you know what? Some people are buying the Replay because they want to know what all the fuss is about."

In other words, Wolfe suggested, the networks' lawsuit is actually helping Sonicblue's popularity. "The idea is that this makes TV so good that networks don't want you to have it; it scares networks," he said.

He added that Sonicblue would like to work with the networks to see if there might be some mutually beneficial opportunities available, such as using Replay to sell consumers video-on-demand programs.

"There's huge opportunities that we're waiting for them to jump on," Wolfe said. "Some clearly are interested, intrigued, but the networks have made a corporate, collective decision to go against us."

And TiVo is "working for the network instead of with them," Wolfe said with a chuckle. "We consider ourselves working for the customers. And we've told the networks they should work with us and we should be creating a better television experience, but we have no interest in promoting the networks' agenda."

When told of these comments, a TiVo spokeswoman dismissed them as inaccurate and nothing but Sonicblue's marketing.

"Sonicblue likes to make themselves look like the consumer watchdog who is against the man," said Rebecca Baer, the TiVo spokeswoman. "It's not about supporting anybody's agenda, it's about trying to run a business. It's not about an agenda."

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