Commentary

The Slower Growth Of The Original Digital TV Technology

by Wayne Friedman , Staff Writer, February 12, 2010

What's happening to DVR growth? It's been growing at a slow-ish 5% clip per year, hovering around the 30%-of-U.S.-households mark for some time, according to analysts.

Not bad. But not at the fast-paced, euphoric rate of consumer electronic products like mobile phones or DVD machines in past years.

Brad Adgate, senior vp and corporate research director for Horizon Media, notes more than a few research estimates have had to lowergrowth estimates of DVR technology and service.

Many projections had DVRs in 40% to 45% of U.S. TV households by now. "They probably thought it was going to be a quicker consumer commodity than it has been," Adgate says. Media researcher Shari Anne Brill, who recently departed ways with Carat USA, also questioned the slow growth pace of DVRs.

Twelve years ago, when the DVR was introduced, it was thought to be major game changer, with a big impact on time-shifting as well as the notorious element of fast-forwarding through commercials.

But it seems perhaps consumers have moved on - and marketers along with them. DVR technology has long been a key piece of digital set-top-box technology. But cable companies still charge $10 or more a month extra to get a DVR unit and service.

Digital cable is in about 60% of all cable TV homes. Some executives believe those homes are less likely to upgrade - at least with DVR service.

At the moment, there's free, ad-supported viewing of TV shows online, video on demand, and new TV sets with internet connections - all growing trends. Get the picture?

Why don't cable companies just give DVR service away for free? Perhaps there is no significant upside - unlike with voice, mobile, and broadband services.

Even iTunes is feeling the pinch. Rumors abound it wants to cut the price of a TV episode with no commercials from $1.99 to 99 cents.

There's too much competition for the original service that time-shifts TV programming from linear program schedules. Marketers can almost rejoice that their consumers' fast-forwarding days are numbered -- that is, until the next new technology rolls around.

dvrs, tv

4 comments about "The Slower Growth Of The Original Digital TV Technology".

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Arthur Miller from Miller Media Group, Inc., February 12, 2010 at 2:31 p.m.
Wayne, my feeling is that DVR growth has been stunted due to the recession, when people are trying to make their budgets go further. Once the economy gets better, DVR growth will be back on track unless new technology comes out with something better.
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Karl Meisenbach from HDNet, February 12, 2010 at 3:28 p.m.

DVR usage is going to grow as the consumer switches over to a HD Set Top Box from their cable/satellite/telco provider.

That's when it's the easiest and most convenient time to get a DVR because its built into the new set top box you are getting.

While the $10 per month for DVR Service is an extra expense,

IS ANYBODY out there who uses a DVR willing to give it up?

Marc Schcher from MSS consulting, February 12, 2010 at 3:38 p.m.

Agree with above comments....but no doubt dvr growth is also slowed by by viewer migration....particularly among younger viewers...to online viewing. Saw a piece of research recently that said that 18-34 year olds see dvrs as "old technology"

Douglas Ferguson from College of Charleston, February 12, 2010 at 4:05 p.m.

Hmm. Not buying it. The content providers will bundle the device. Gotta keep up with the satellite operators.