US consumers have been slower to embrace DVR technology than previously anticipated.
A new report by media analyst Magna Global, which cites data from satellite television provider DirecTV and Time Warner's cable TV division, suggests sales of digital video recorders, with their ad-skipping potential, may have plateaued.
On Demand Quarterly says sales in the second quarter this year were down from both Q1 and the last quarter of 2004. In Q2 this year 965,000 subscribers signed up for the device, compared with 1.15 million in Q1 and 1.32m in Q4 last year.
Magna Global's director of industry analysis, Bruce Weiser, believes price is a limiting factor in DVR potential.
He says: "If predictions of large numbers of DVR services in the next couple of years are unfounded - and the data we are seeing shows the rate of growth is slowing, not increasing - our point of view is that they appeal to higher-end subscribers."
Industry observers point out, however, that companies will respond to the downturn in purchasing by making the service cheaper. DVR pioneer TiVo, with 3.6m subscribers, has significantly marked down the price of its entry-level digital recorder from $100 (€80; £54) to $50 [WAMN: 08-Sept-05].
Data sourced from mad.co.uk; additional content by WARC staff