Many financial analysts including Oppenheimer (2006) expect to see acceleration in subscriber growth. The consensus of industry analysts including IDC and Forrester Research is that DVR subscriber growth will hit a 60% CAGR over the next three years. We expect it to slow to 45% and 16% annual growth in 2007 and 2010, respectively. By the end of 2010 IDC estimates there will be roughly 52 million DVRs in the United States. Assuming an $8 monthly billing rate, we estimate the DVR market will be a $5.0 billion revenue opportunity according to IDC (2007).

Figure 1: Comparing DVR Product Segments Adoption Rates

Industry Chain Process

The industry relies primarily on a multi-pronged approach to distribution, as is shown in Figure 2. The figures included throughout the analysis highlight the distribution of DVRs by the specific channel shown. 60% of total DVRs flow through the DirectTV channels, and the remainder are...
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