Microsoft announced a deal with Comcast yesterday, bundling Microsoft software with Comcast set-top boxes and DVRs. The software will include support for recording HDTV.

Thomas Hawk has the most interesting take on it:

“So let me see if I get this one straight. If I’m a Comcast subscriber I can get a box from Comcast for a nominal monthly fee that runs Microsoft software that can record HDTV or I can go out and spend $1,500 on a Microsoft Media Center PC that cannot record HDTV content from my very same provider Comcast.”

Why would Microsoft do this when it looks like it cannabilizes its sales for MCE? Like the PC wars of the 80’s and 90’s, I don’t think Microsoft cares who wins the war, as long as their software is bundled on both sides. In this DVR war, I think Microsoft again wants to be the arms dealer for both sides, focusing on providing the best technology so that they can become the standard for these kind of devices.

The public perception is that Tivo is the standard-bearer, a technology built upon Linux. That can’t sit too well in the board room up in Redmond, WA.

I haven’t had much chance to read up on the MPAA lawsuits, but Ploosh.com has an excellent roundup of them here and here.

Via LostRemote, the Yankee Group forecasts swift sales for DVRs estimating a 7 million unit installed base by years end. Tim Hanlon, senior vice president, director of emerging contacts for Publicis Groupe’s Starcom, says:

“We’ve moved past the early-adopter stage by the middle of this year, and we’re clearly now in the early majority stage and the numbers are going to continue to grow.”

There were some other interesting tidbits in their other findings:

• Aggressive pricing resulting from News Corp.’s acquisition of DirecTV and DVR services such as Highlights-on-Demand for NFL Sunday Ticket subscribers will drive DVR penetration on the DBS platform.
• Cable operators will continue to extend their DVR deployments to new markets and initial take-rates will hold true for newer markets.
• Consumer electronics manufacturers will continue to integrate DVR functions into DVD players, TVs, gaming consoles, and other devices.
• Consumer electronics manufacturers will deploy TiVo’s basic service on low-cost devices that require no monthly service fee. This will lower trial barriers for consumers.

Via Build Your Own PVR, XBMC 1.1 has been released with a lot of cool new features. XBMC is a media center player for the XBox that requires some elbow grease to get setup, but is a really nice way to stream video and audio out to your television.

Additional Info:

• TVHarmony: XBoxMediaCenter

I was very interested in Due Diligence’s reaction to Charlie Demerjian’s article, Prepare to get screwed by digital rights management. Tim Oren, the author of Due Diligence, always has interesting things to say, and he didn’t disappoint with these bullet points:

• Copy protection DRM always destroys end user value, in both convenience and robustness. When you see DRM in a business plan or analysis, it is always there to benefit someone other than the end user. Find out who, it will indicate where power lies in a content value chain.
• The mere presence of DRM indicates a failure to deliver end user value. If the information object were to lose value when extracted from the bundle or service from it was derived, DRM would not be felt necessary. Therefore the presence of DRM suggests a vendor that is behind the curve, failing to find a new value to deliver as their chokepoint disappears in the digital world.
• DRM almost always means there is trouble afoot for aggregators (’infomediaries’). If it’s an aggregator inserting the DRM, their value added is in question. If it’s information originators mandating DRM, then they feel they can damage the aggregator’s value with impunity, and will likely try to drive end users’ attention to themselves.

(more…)

Blockbuster, who has painted a big red bullseye on NetFlix by offering a competitive service, has introduced a new distribution system which should make getting DVDs in the mail faster. NetFlix competitors have have been popping up all over lately with Walmart, Blockbuster, and soon likely Amazon, all vying to get into NetFlix’s turf. Blockbuster, flipping through it’s own list of competitive advantages, may have found a way to convince people to switch services.

I’ve been a NetFlix subscriber for a couple of years now, and I’m in love with the service. Over time, I’m sure I lost more money in movie late fees than I did when the Internet bubble popped (although it would be close call), and NetFlix has a slick service that avoids those fees and reliably sends you three movies at a time via the mail.

The downside for some people is the lag between sending in a movie that has been viewed and receiving a new one. It can take 4-5 days, even in my case as I’m less than 100 miles away from a distribution center. For those people in GodKnowsWhere, Alaska, I’m sure it may take a little longer.

Up until now, the competing factors have been price and name brand, both of which has been handled pretty well by NetFlix. Blockbuster is trying to shake things up a little and is doing a smart move here by using it’s advantage of having 1000’s of stores and using them as ad hoc distribution centers. We’ll see how it all plays out, but if they are successful, it could cut the time down consirably. Not to disparage all local Blockbuster employees, but I’ve run across a few that have been less than stellar, so we’ll see if indeed they are capable of achieving error free, faster results.

At the end of the day, Video on Demand may make this a quaint old debate like the merits of 8-Track vs. cassette, but for now, it will be interesting to see how the market changes.

(Hat Tip: TVPredictions.com)

Sales of Scientific Atlanta DVRs are way up this quarter, according to this article from AP. They shipped 397,000 DVRs the quarter ending Oct 1, which is typically a slow quarter for consumer electronics. In comparison, Tivo shipped 288,000 units in their quarter ending July 31st.

With a two month lag between the two datasets, it’s not an accurate comparison but it goes to show there is more than one pony in the race to gain marketshare.

(Hat Tip: TVPredictions.com)

Via eHomeUpgrade, the CEA just released this press release saying that 38% of online users use one of their computers as a media server for digital content. Here’s the important graf:

In an afternoon panel session on Monday, “Media Servers - Fact or Fiction” Wargo revealed that 38 percent of consumers currently own a media server, either with a desktop or personal computer acting as the server or a dedicated media server. CEA Market Research defines media servers as devices that store of all a consumer’s digital content (music files, home video, digital images) in one location, allowing it to be viewed or listened to from multiple locations in the house.

The survey found that close to 19 percent of consumers indicated they plan to purchase a media server in the next two years. Of those, 49 percent noted they would be somewhat or more likely to purchase a server if a professional could install, set-up and maintain their server.

It looks like digital content in the home is starting to get some traction. The number of users who said they’d prefer a professional to install it means that the industry needs to create products that are a whole lot easier to understand and use.

A couple days ago, I pointed out Radioshark, a product that records radio programs similiar to Tivo. Here’s an article pointing out another product that actually records internet radio shows called Replay Radio. From what I’ve seen, it sounds pretty cool.

I’m planning on doing a review of these two products to see how they work. Having used a PVR for a while now, I find myself in need for a similiar solution for radio. It sure would make my commute easier.

Another research company has come up with the same result that PVR users skip television ads. To be redundant, I think here’s where they are wrong.