EchoStar looks to outduel TiVo.

• Author: Peterson, Eric
• Position: EchoStar Communications Corp.

TiVo has become a household word, but many TV industry observers see TiVo the company as a dead duck. Hype aside, Littleton's EchoStar Communications Corp. has been neck-and-neck with TiVo on the DVR track since 1999, when EchoStar's DISH Network released the market's first digital video recorder (DVR)--just before TiVo did.

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"It's a marriage made in heaven for satellite TV," said EchoStar spokesperson Marc Lumpkin. "Everything I watch is in digital and everything I record is in digital, so there's no degradation of the signal."

While EchoStar partnered with Microsoft on that first product, the Colorado company has since developed a wide range of DVR technology independently and internally, at R & D facilities in Englewood and in the United Kingdom. After re-entering the market with a proprietary DVR in 2000, the company hit the milestone of 1 million DVR subscribers--out of a total satellite television subscriber base of 11 million--in September 2003, faster than any other provider in the country. (Smith Barney estimates that there are 6 million DVRs now in use, and forecasts that half of all U.S. house-holds--about 60 million--will have them by 2010). EchoStar was also first to market with a high-definition DVR and a multi-room, single-box DVR.

"TiVo has become the Kleenex of DVRs," said analyst Bruce Leitchman of the Leitchman Research Group in Durham, N.H. "But the one thing people don't realize is, up until the middle of last year, EchoStar was the leading provider of DVRs."

Leitchman pegged the total number of EchoStar boxes now deployed at about 2 million, but thinks the company might have been too aggressive in going after volume over value to the consumer. "You have to be...