A chicken in every pot; an IPO for every gizmo.

In these flush times, it doesn't take long for a new product to find underwriters and offer stock to the public.

Such is the case of TiVo Inc. and ReplayTV Inc., two Silicon Valley companies that began selling digital video recorders, or DVRs, last year. The devices are cousins of the ubiquitous videocassette recorder. When connected to a television, they let viewers record programs on a hard disk drive instead of tape.

Do Americans hanker for another "box" near their TV sets? DVRs cost between $400 and $900 and are regarded by some entertainment executives as an interim product that will be eclipsed by video-on-demand.

But none of these questions dampened investors' enthusiasm for TiVo, which filed an IPO last year when it had just 1,000 subscribers. TiVo raised $92 million in its initial public offering in September, and the stock which was priced at $16 closed as high as $71.50 in January before retreating to about $35 in recent days. Chief competitor ReplayTV recently filed a proposal to sell as much as $150 million in shares to the public.

Why the sizzle? DVRs offer greater convenience and control for TV viewers. With a few clicks on a hand-held control, you can instruct the DVR to record every episode of "The Sopranos," for example, or search for programs with a favorite theme or actor. You can even pause, rewind and play back a live broadcast.

Both TiVo and ReplayTV were founded in August 1997. Each attracted big-name investors. But TiVo, based in Sunnyvale, beat ReplayTV into stores as well as to the stock market. TiVo reported sales of 26,000 units in 1999; RePlayTV, based in Mountain View, said it had shipped 6,000 units for the year.

ReplayTV has been selling its devices through its Web site, a toll-free telephone number and online retailers. The company said it won't make a full-scale retail launch until mid-year.

Unlike TiVo, ReplayTV doesn't require a $9.95 monthly fee for program listings. Both products allow a viewer to fast-forward, but Replay goes a step further with a feature that alarms advertisers and delights some viewers. "Only the ReplayTV has a 30-second skip button for zapping commercials, making it our pick" among DVRs, wrote Wired Magazine's David Pescovitz last year.

The jeopardy to advertising revenue isn't lost on TV networks or programmers. Some media companies invested in TiVo and ReplayTV last year to influence or temper the business plans. Both TiVo and ReplayTV now say they want to collaborate with advertisers to offer new ways of reaching target audiences. ReplayTV no longer talks up its "zap" feature.


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