TiVo Cuts Entry Prices

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TiVo Inc. cut the cost of its entry-level digital video recorder to $199 last week. The company's 40-hour Series2 DVR costs $199, while an 80-hour model retails for $299.

Previously, TiVo charged $249 for the 40-hour DVR and $349 for the 80-hour model.

In addition to the hardware costs, TiVo charges its customers $12.95 per month, or a one-time service fee of $299 for the lifetime of the DVR. The service-fee pricing remains the same under the new promotion.

"Our goal has always been to make TiVo more affordable for consumers so that more people can have access to the original features unique to the TiVo service, and be in control of their television experience," TiVo vice president of sales Joe Miller said in a statement. "We believe that priced at $199, it's now easier than ever to get TiVo."

DirecTV Inc. distributes TiVo-branded DVRs, but cable operators have pursued DVR rollouts on their own, rather than partnering with TiVo. Instead of selling customers the DVRs, MSOs such as Time Warner Cable and Comcast Corp. lease the set-tops, which contain hard drives, to subscribers.

Time Warner Cable divisions lease Scientific-Atlanta Inc. DVRs to subscribers for prices ranging from $4.95 to $9.95, depending upon the market. Comcast charges $9.95 per month for its S-A DVRs, which are available on four systems, and Insight Communications Co. subscribers pay a monthly charge of $12.95 to lease DVRs from Motorola Corp.

EchoStar Communications Corp., which was the first company to reach 1 million DVR customers last September, offers new subscribers its Dish Player 510 DVR for free. EchoStar charges monthly DVR fees of $4.98.

The DBS company offers existing customers promotions where they can upgrade to a Dish Player DVR for about $100. EchoStar also recently began selling a $999 DVR that can record HDTV programming.

Rival DirecTV Inc. charges $99 for its DirecTV DVR with TiVo, plus a monthly service fee of $4.99. This spring, DirecTV plans to begin selling a TiVo-branded HDTV DVR that will retail for $999.

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