NTL sounds death knell for the VCR

NTL has heralded the death of the video cassette recorder by announcing plans for an advanced set-top box that will let users record TV programmes onto its hard drive.

Users will be able to record around eight hours of television on the device's 9Gb hard drive. The box, which will run Microsoft's interactive TV software, will also give access to digital terrestrial TV and Web and email access.

Analysts said that even though the device has a much smaller hard drive than dedicated digital video recorders (which can record up to 40 hours), it is likely to be a cheaper option and will replace the VCR for many users.

"It depends on the price of the box, but if people start using this package, they will stop using their video recorder for many functions," said Henning Dransfeld, an analyst at Ovum.

Users of the service will be able to play along with game shows, and get sports statistics and additional audio and video clips while watching programmes. Online gamers will be able to store software on the device's hard drive to make gaming faster.

NTL said the device would be available later this year and would probably be available on a subscription basis. The user wouldn't need an NTL cable connection, but would need a telephone line for sending data upstream. NTL will bundle a phone line with the box.

The box will run Microsoft TV software, a new product from Microsoft that combines Windows CE with applications such as video recording. Microsoft spent several years working out how to bring its Web TV service, popular in the US, to market in the UK. But it has finally scrapped this ambition in favour of using the Web TV technology in the Microsoft TV platform.

"This is Web TV technology made into a product," said Bruce Lynn, Network Solutions group manager at Microsoft UK. "It's really two layers, an operating system layer - Windows CE - and an applications layer, like personal video recording."

The announcement is another blow for NCI, the Oracle and Sun-Netscape Alliance led venture which scooped Microsoft to win the platform contract for NTL's initial digital TV roll-out last year. Soon after the contract was awarded, Microsoft invested $500 million in NTL and the two companies have been working closely ever since.

An NTL spokesman said it will continue to sell its TV Internet service, using the NCI platform, but conceded that the Microsoft TV platform is a "natural upgrade path.".

NTL's entry into the digital terrestrial market allows NTL to offer interactive TV services to the 60 per cent plus of the population not passed by its cables. "It's a very clever thing because it allows NTL to market services to homes outside their franchises," said Ovum's Dransfeld.