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Comcast has a added a weapon for fighting the cable wars: a high-definition digital video recorder.
The dominant cable carrier in the market is quietly making the recording devices - based on the same technology as the famous TiVo recorders - available to about 350,000 Sacramento-area customers.
DVRs record television shows on a computer-style hard disk rather than on tapes like a video cassette recorder. They allow users to record two shows at once, watch a partially recorded program as the ending is taped, and pause and rewind live TV.
The rental of standard DVRs would put Comcast on equal footing with satellite providers Dish Network and DirecTV, which have had DVRs for at least four years. SureWest Broadband expects to offer them sometime in 2005.
But Comcast is upping the ante. Its DVRs also include a converter for receiving high-definition broadcasts and the ability to record high-definition programming - at a much lower price than is available from the satellite carriers.
Comcast charges $9.95 a month for the DVR and high-definition programming, on top of the roughly $55 a month customers pay for the lowest tier of digital cable service.
Satellite programming fees vary, but DirecTV is charging $1,000 - and Dish, $549 - to buy a high-definition DVR.
With high-definition TVs expected to hit sales records this year, analysts say such offerings could help cable companies like Comcast regain some of the ground they have lost to satellite, which now has about 23 million of the 108 million television households in the United States. That compares with about 10 million in 1999.
"Comcast and other cable companies generally provide a better high-definition offering than satellite, and their high-definition DVR is more affordable," said Phillip Swann, an industry analyst and president of TV Predictions.com. "Put it all together and cable has a better offering."
Comcast spokeswoman Susan Gonzales said the company's high-definition business is increasing by 5 percent to 7 percent a month as more of its customers buy the sophisticated TVs.
She expects it to grow even more when the system begins broadcasting most Kings home games in high-definition beginning Sunday, something that won't be available from satellite.
One convert to DVRs is Stan Atkinson, the longtime Channel 3 news anchor who retired in 1999.
"I have friends who have TiVo, and they can't stop talking about it," said Atkinson, who got his Comcast DVR installed last week.
After seeing the TiVo in action, he called friends at Comcast to put him on the waiting list for the new DVRs.
"I'm really enjoying it," he said of the DVR, adding that he was particularly pleased with not having to juggle videotapes, and with the ability to schedule a recording with one push of the remote-control button.
But Teresa Hahn, a DirecTV subscriber and TiVo user in Sacramento, said she wouldn't be tempted to switch to Comcast, even if she bought a high-definition television.
"I really love satellite; I love their customer service," she said. "If I can afford my own high-definition TV, then I can afford the ($1,000) box."
Satellite companies hope to build on that kind of customer loyalty with offerings of their own.
Though Dish Network's high-definition DVR costs $549, it is offering a free basic DVR to customers who pay a $4.99 monthly fee.
The company also offers a free high-definition receiver (but not DVR) to its subscribers. "We find that when cable companies upgrade their service, it increases the number of people who start (comparison) shopping," said company spokesman Marc Lumpkin.
DirecTV spokesman Bob Marsocci said he didn't think Comcast's offering put his company at a disadvantage. He said the company's $1,000 high-definition DVRs were "flying off the shelves."
The company that might be most hurt by the moves of Comcast and other cable companies is TiVo Inc., the Silicon Valley company that pioneered DVRs and whose name has become synonymous with digital video recording.
Founded in 1997, TiVo was never able to catch the public imagination. The company has lost more than $550 million since it went public in 1998, including a loss of $26.4 million in the most recent quarter.
Vamsi Sistla, an analyst with ABI Research in New York, said customers were also put off by the $12.95 monthly fee TiVo charges to use its service.
But since consumers are already used to paying monthly cable bills, adding a DVR fee to the charge won't faze them, he said.
Swann, the television analyst, thinks cable's participation could kick off a surge of DVR usage.
"There are 4 million to 5 million DVRs out there right now," he said. "But 2005 will be a year of serious growth."
Comcast has a added a weapon for fighting the cable wars: a high-definition digital video recorder.
The dominant cable carrier in the market is quietly making the recording devices - based on the same technology as the famous TiVo recorders - available to about 350,000 Sacramento-area customers.
DVRs record television shows on a computer-style hard disk rather than on tapes like a video cassette recorder. They allow users to record two shows at once, watch a partially recorded program as the ending is taped, and pause and rewind live TV.
The rental of standard DVRs would put Comcast on equal footing with satellite providers Dish Network and DirecTV, which have had DVRs for at least four years. SureWest Broadband expects to offer them sometime in 2005.
But Comcast is upping the ante. Its DVRs also include a converter for receiving high-definition broadcasts and the ability to record high-definition programming - at a much lower price than is available from the satellite carriers.
Comcast charges $9.95 a month for the DVR and high-definition programming, on top of the roughly $55 a month customers pay for the lowest tier of digital cable service.
Satellite programming fees vary, but DirecTV is charging $1,000 - and Dish, $549 - to buy a high-definition DVR.
With high-definition TVs expected to hit sales records this year, analysts say such offerings could help cable companies like Comcast regain some of the ground they have lost to satellite, which now has about 23 million of the 108 million television households in the United States. That compares with about 10 million in 1999.
"Comcast and other cable companies generally provide a better high-definition offering than satellite, and their high-definition DVR is more affordable," said Phillip Swann, an industry analyst and president of TV Predictions.com. "Put it all together and cable has a better offering."
Comcast spokeswoman Susan Gonzales said the company's high-definition business is increasing by 5 percent to 7 percent a month as more of its customers buy the sophisticated TVs.
She expects it to grow even more when the system begins broadcasting most Kings home games in high-definition beginning Sunday, something that won't be available from satellite.
One convert to DVRs is Stan Atkinson, the longtime Channel 3 news anchor who retired in 1999.
"I have friends who have TiVo, and they can't stop talking about it," said Atkinson, who got his Comcast DVR installed last week.
After seeing the TiVo in action, he called friends at Comcast to put him on the waiting list for the new DVRs.
"I'm really enjoying it," he said of the DVR, adding that he was particularly pleased with not having to juggle videotapes, and with the ability to schedule a recording with one push of the remote-control button.
But Teresa Hahn, a DirecTV subscriber and TiVo user in Sacramento, said she wouldn't be tempted to switch to Comcast, even if she bought a high-definition television.
"I really love satellite; I love their customer service," she said. "If I can afford my own high-definition TV, then I can afford the ($1,000) box."
Satellite companies hope to build on that kind of customer loyalty with offerings of their own.
Though Dish Network's high-definition DVR costs $549, it is offering a free basic DVR to customers who pay a $4.99 monthly fee.
The company also offers a free high-definition receiver (but not DVR) to its subscribers. "We find that when cable companies upgrade their service, it increases the number of people who start (comparison) shopping," said company spokesman Marc Lumpkin.
DirecTV spokesman Bob Marsocci said he didn't think Comcast's offering put his company at a disadvantage. He said the company's $1,000 high-definition DVRs were "flying off the shelves."
The company that might be most hurt by the moves of Comcast and other cable companies is TiVo Inc., the Silicon Valley company that pioneered DVRs and whose name has become synonymous with digital video recording.
Founded in 1997, TiVo was never able to catch the public imagination. The company has lost more than $550 million since it went public in 1998, including a loss of $26.4 million in the most recent quarter.
Vamsi Sistla, an analyst with ABI Research in New York, said customers were also put off by the $12.95 monthly fee TiVo charges to use its service.
But since consumers are already used to paying monthly cable bills, adding a DVR fee to the charge won't faze them, he said.
Swann, the television analyst, thinks cable's participation could kick off a surge of DVR usage.
"There are 4 million to 5 million DVRs out there right now," he said. "But 2005 will be a year of serious growth."
