Samsung Adds PVR to AOLTV

Samsung Electronics is developing a set-top for the struggling AOLTV service that could either work in conjunction with existing cable set-tops or replace them.

The new set-top, which Samsung expects to hit retail this spring, will offer personal video recording functions. It also will contain coaxial cable connections and let users connect the box to a digital-subscriber-line modem, cable modem or a universal serial bus port on a personal computer, Samsung spokeswoman Serena Tesler said.

Samsung director of marketing communications Richard Johnson said the company sees other PVR manufacturers as its direct competition. He said Samsung hasn't settled on a price for the new set-top, but it will be "competitively priced."

Time Warner Cable spokesman Mike Luftman declined to comment when asked if the MSO would deploy the Samsung box to its cable subscribers. America Online spokeswoman Marta Grutka said no executives were available to discuss the new AOLTV set-top.

Prior to Samsung's entrance, Philips Consumer Electronics was the sole manufacturer of the first-generation AOLTV box, which does not have PVR capabilities.

The AOLTV box has been "a major bleeder" for Philips so far, a source familiar with the situation said earlier this month. An industry source said only about 10,000 AOLTV boxes had been shipped as of about three months ago. Philips spokesman Simon Poulter would not comment on shipment figures.

Forrester Research analyst Josh Bernhoff said AOLTV has sold poorly because WebTV Inc., with 1.5 million subscribers, "has already sucked up the small number of people that want to have the Internet on their TV set."

By adding the PVR feature, AOL should be able to sell more of the set-tops, Bernhoff said. "People are willing to pay for that," he added.