TiVo rival ReplayTV is scrapping its digital video recorder and has axed its CEO and chairman Kim LeMasters along with over 100 staff.

The company is changing its business model too, and will now focus on licensing its technology to manufacturers and cable operators. In short, it's pulling-out of direct competition with TiVo.

The company's Mark One (actually, Mark Two) business model relied on revenue from retail sales of the ReplayTV box, and from advertising adorning personalised "ReplayTV channels".

The latter was a tricky proposition, as one of the attractions of digital TV recorders is that you can skip the advertisements.

ReplayTV now faces the tough task of persuading consumer manufacturers to use its technology rather than their own in-house work. Sony and Philips are signed up as TiVo partners. The rewards are high though, and ReplayTV has the potential of being the default browser - the Netscape if you like, of TV (or at least recorded TV).

Success hinges on whether it can give licensees cost and time-to-market advantages, with TiVo rapidly becoming as synonymous with recorded TV as Hoover is with vacuum cleaning. Also, ReplayTV depends upon the willingness of manufacturers to establish a common platform, and make the traditional vertical model a little more horizontal. This is not something that they have ever been really interested in before. ®