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Recordable DVD Demand Looks Good In Near Term

The demand for DVD recordable decks look more promising in the near term than digital video recorders (DVR), according to a report issued during the CEA Industry Summit, held at the La Costa Resort, here.

During a seminar on the subject, CEA’s industry analysis director Sean Wargo provided context for the discussion with a report on the market. His report outlined several forecasts for 2003. For instance 6.3 billion CD-R/RW discs will ship this year, 70 percent more than 2002 and about 200 million DVD-R/RW discs will ship this year, up 300 percent vs. 2002. Within the next year 17 percent of non-DVD owners and 20 percent of DVD owners plan to buy a DVD recorder. And CEA predicted that DVD recorder unit sales will reach 717,000 this year, growing to 2.061 million in 2004 and 3.599 million in 2005.

The demand for DVRs is less robust, according to Wargo’s report. Consumer interest in buying a DVR has only gone up 1 percent per year from 2001, when it was at 4 percent, 5 percent for 2002 and 6 percent for 2003. Unit sales were 170,000 in 2002 to an estimated 205,000 this year, and probably 258,000 during 2004. An avid TiVo owner, Wargo commented, “Hopefully DVR/DVD recordable decks, and other possible combinations will help push DVR sales higher than our projections.”

Many on the panel saw the flexibility of DVD recording as an advantage over DVRs, at least in the short term, but the real challenge for the industry is going to be identifying winning applications. Felix Nemirovsky, CEO of Chuba Consulting, said there is “no problem in reducing the cost” of DVD recording decks, but the problem is “winning applications.” He noted, “You can put your home videos on DVD, but that seems to be a limited market.”

Jim Taylor, chief of DVD technology and general manager of Sonic Solutions, said DVD recorder sales will take off in a year or so “because people will be in the market for replacing their VCR. Once they see DVD recorders they will want a digital recording device. Consumers are comfortable with VCRs, they know DVD players, so it will be an easy jump to DVD recorders.”

He added that DVRs are still “too complicated” for many consumers to consider.

Sean Stead, Samsung America’s senior manager/storage, said that DVD recorders combine “photo, video and data storage. And if you want to bring a home video to a neighbors house you can bring a disc,” vs. recording on a DVR.

Wargo said that DVRs can provide “ubiquitous access to your content. That is the goal when [DVRs] become content servers.” He admitted some DVRs are “not easy to use, now,” but that should change in the future.