NEW YORK (CNN/Money) – Digital video recorder sales haven't performed as well as other entertainment product this year, but a new study says that DVR sales will explode by 2007.
The Yankee Group, a Boston-based research and consulting firm, estimates that DVRs will be present in 3.2 million homes by the end of 2003, up nearly 40 percent from 1.8 million homes at the end of 2002. But by 2007, approximately 24.7 million homes will own a digital video recorder.
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Digital video recorders allow television viewers to pause, rewind or automatically record their favorite programs as they broadcast. ReplayTV, TiVo and Sony (SNE: Research, Estimates) are among the most widely recognized DVR brands.
The study says consumer electronics manufacturers are contributing to the platform's growth by integrating DVR functions into DVD players, televisions, and gaming consoles.
RCA, Pioneer (PIO: Research, Estimates), and Toshiba are among the companies that have integrated DVR technology into their consumer product lines.
The firm also anticipates that the next generation of gaming consoles with integrated DVRs, such as the Sony PS3 and Microsoft Xbox 2, will drive electronics manufacturers' share of the DVR-installed base.
And cable operators that offer DVR-capable set-top boxes are expected to increase their market share more rapidly than previously expected.
Time Warner Cable, a unit of CNN/Money.com's parent company Time Warner (TWR: Research, Estimates), and Cox Cable (CXR: Research, Estimates) already use integrated DVR set-top boxes. Charter and Comcast (CMCSA: Research, Estimates) are expected to deploy DVR technology by the end of 2003 and a number of other cable companies are expected to integrate DVR technology into their systems in 2004.
An increase in DVR-ready platforms will also mean that some homes will have multiple DVRs by 2007. An individual household, for example, may have several DVR set-top boxes from its cable operator and a DVR-capable gaming console.
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