More TIVO.....1/26/99- Updated 08:31 PM ET
A new approach to TV viewing
SUNNYVALE, Calif. — Traditional TV is once again under attack.
Two Silicon Valley start-ups expect to launch services soon to enable TV
viewers to watch what they want when they want without fiddling with a
videocassette recorder.
TiVo and Replay Networks take center stage just as the 6-year-old Your
Choice TV closes its doors — a victim of TV's resistance to change.
TiVo and Replay have similar ideas but different business models. For a
small monthly charge, about $10, the TiVo service will search the airwaves
24-hours a day and automatically capture those programs or types of
programs that their subscribers say they want. The programs will be stored
in a VCR-size box connected to the TV for replay.
Replay will do the same thing. But there won't be a monthly fee. Instead,
consumers will have to spend almost $1,000 upfront for the equipment.
TiVo's start-up equipment costs are expected to be $300 to $500.
Replay plans to begin selling its boxes direct in November. TiVo, after
trials this fall in California, expects to roll its service out nationwide next
year.
Both companies are building on the notion that viewers, not networks,
should decide what to watch and when. ''Prime time becomes anytime,''
says TiVo CEO and co-founder Michael Ramsey.
The search mechanisms for Replay and TiVo differ slightly. With both,
consumers will use remote controls to program their services to search for
what they want. Both can search for programs, types of program, say
comedies, or for actors or even directors. The services only search the
networks or cable and satellite programs already delivered to the home.
TiVo's search mechanism, however, goes one step further in that it learns
from the viewer's choices and becomes able to offer suggestions.
TiVo's service stores up to 20 hours of programming on a magnetic disk.
Replay will offer boxes that store seven to 30 hours.
Whether the services will get enough consumers to make a go of it remains
to be seen. One possible show-stopper for both is the cost, at least
initially, of the equipment. Eventually, TiVo expects to get so many
subscribers that advertising revenue bears much of service's cost. TiVo
also hopes to get makers of TVs, VCRs and personal computers to
include the technology in their devices, making it more affordable.
That doesn't take care of perhaps bigger challenges, including those of a
technical or marketing nature. Numerous ventures, including Your Choice
TV and Time Warner's Full Service Network, have tried to do similar
things and failed. That has made analysts and investors very wary. ''TiVo is
an intriguing idea, but it has a long way to go,'' says Derek Baine of Paul
Kagan Associates.
Still, the potential payoff is so big that companies keep trying. Almost
every U.S. home has a TV, and viewers spend hours with them. TiVo is
going after more than just viewers. It wants to get advertisers on board as
well and begin to target specific ads to specific households.
If successful, ''it will have a lot of value,'' says Gary Arlen, president of
Arlen Communications.
By Julie Schmit, USA TODAY
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