I believe it detected the hard cut between content and commercial. It was honestly flawless as long as I had it.

I wondered how this could reliably distinguish between a scene cut and a cut to commercial without content hashes and/or program schedules being shared through the network, then realized that 20 years ago was already 2003 and of course home internet was common by then.

Apparently one offline technique was checking for black frames inserted by local stations.

Some more information here: https://en.m.wikipedia.org/wiki/ReplayTV