×

Welcome to the Slashdot Beta site -- learn more here. Use the link in the footer or click here to return to the Classic version of Slashdot.

Thank you!

Before you choose to head back to the Classic look of the site, we'd appreciate it if you share your thoughts on the Beta; your feedback is what drives our ongoing development.

Beta is different and we value you taking the time to try it out. Please take a look at the changes we've made in Beta and  learn more about it. Thanks for reading, and for making the site better!

Will TiVo Destroy Ad-Supported TV?

timothy posted more than 10 years ago | from the will-ads-destroy-tivo dept.

Television 943

windowpain writes "According to a column in Television Week, the increasing popularity of digital video recorders will actually cause a decline in ad revenues in the next few years. 'The rollout of DVR-type technology ... will reach critical mass with 11 percent penetration of U.S. television households by 2005 and 15 percent by 2006...As a result, five-year earnings growth for TV station groups could fall from as much as 10 percent to as low as 4 percent.' Why? DVR users skip at least two-thirds of commercials and the 'collective impact represents a threat to revenue and cash flow growth that cannot be offset ... Fifteen percent DVR penetration implies that 9.1 percent of all ads would not be watched and that advertisers would be overpaying by 9.1 percent, or $6.6 billion as calculated from projected 2006 total ad revenues of $72 billion.' And another business model goes down in flames."

cancel ×
This is a preview of your comment

No Comment Title Entered

Anonymous Coward 1 minute ago

No Comment Entered

943 comments

First Post! (-1, Offtopic)

Anonymous Coward | more than 10 years ago | (#7597181)

FP

Finally!

Nope (5, Insightful)

Anonymous Coward | more than 10 years ago | (#7597187)

There are other ways to advertise on TV besides commerical breaks, advertisers will just have to adapt.

Re:Nope (2, Informative)

Dunkelzahn (106055) | more than 10 years ago | (#7597209)

They do already. Jerry Seinfeld drinking a Coca Cola and placing it in front of the camera in full view, Frasier Crane driving a Mercedes or BMW, you see name brands on all the major network TV shows.

Re:Nope (4, Insightful)

leviramsey (248057) | more than 10 years ago | (#7597250)

And you'll see more of a movement to sports programming where two things come into play:

  • The proportion of viewership watching on a time-skipping basis is likely less (especially when communal viewing (e.g. bars) is taken into account, though current audience measurements do a piss-poor job of that)
  • It's trivial to integrate the advertising into the content (beyond event-produced ads like boards on sidelines and sponsorship patches on clothing); CBS, for instance, was periodically digitally painting AOL 9.0 ads on the field during the Florida/Florida State game Saturday.

I'll be back - at Pizza Hut! (3, Interesting)

Channard (693317) | more than 10 years ago | (#7597321)

Or presumably Terminator 4 will have a shoot-out in a Pizza Hut, with a huge Pepsi truck slamming through the wall, the enemy terminator stepping out wearing Gap Jeans and Nike trainers. Lets face it, you couldn't get more shameful than the 'Xanax' or whatever truck in Terminator 3.

Or maybe advertisers will just make ads that fool Tivo - ramping up informercials, perhaps?

Re:I'll be back - at Pizza Hut! (1)

Channard (693317) | more than 10 years ago | (#7597340)

Lets face it, you couldn't get more shameful than the 'Xanax' or whatever truck in Terminator 3.

Though the fact I don't know for sure what the drug name was, shows the placement didn't affect me that much.

Re:Nope (2, Insightful)

Anonymous Coward | more than 10 years ago | (#7597235)

Probably won't work with the current TV model. A majority (most?) shows are made by outside producers and sold to the channel.

Also, significant revenue comes from reselling (to other channels and other countries) or repeating shows.

A show with an embedded ad is far less attractive to a buyer, as their employer won't make any money from that ad - the producer did.

Re:Nope (2, Interesting)

leviramsey (248057) | more than 10 years ago | (#7597263)

Then you turn the current model on its head. The producer tracks down the advertisers who pay the producer. The producer then pays NBC to put the show on.

Re:Nope (-1, Troll)

Anonymous Coward | more than 10 years ago | (#7597269)

Mod up.

What, like movies? (4, Informative)

BiggerIsBetter (682164) | more than 10 years ago | (#7597271)

  • Italian Job == Mini (BMW) advertisment
  • Tomb Raiders == Land Rover then Jeep adverstisement
  • Mission Impossible == Apple advertisment
  • Top Gun == RayBan advertisement
  • The African Queen == Gordens Gin advertisement
  • etc...

The question is, is it subliminal or not (read illegal)? And does it even work? Personally, I've gotten very good at filtering advertising...

Re:What, like movies? (2, Insightful)

DNS-and-BIND (461968) | more than 10 years ago | (#7597275)

You forgot...James Bond, ever since Roger Moore retired, has been nothing but a shill for luxury brands. Heck, the owners of the Bond brand brag about it in Wall Street Journal interviews...

Re:Nope (1)

weave (48069) | more than 10 years ago | (#7597281)

Like banner ads, unfortunately. Expect more of those annoying graphics flying around the bottom of the screen during your shows. You know, like how it's limited currently to advertising other shows in the first minute after a commercial break.

Ironically (5, Funny)

ObviousGuy (578567) | more than 10 years ago | (#7597189)

I find that skipping the programs to get to the commercials to be more interesting than the other way around.

Re:Ironically (1)

smack_attack (171144) | more than 10 years ago | (#7597273)

The first thought that came to mind was someone programming their TiVo to record the shit in the early hours of the morning, then replaying all the phone sex commercials.

Re: Ironically (2, Insightful)

Black Parrot (19622) | more than 10 years ago | (#7597342)


> I find that skipping the programs to get to the commercials to be more interesting than the other way around.

That's probably the best strategy for finding soft porn.

I don't get it? (5, Interesting)

cablepokerface (718716) | more than 10 years ago | (#7597190)

When it's conventionally taped, don't you skip the commercials as well?

Re:I don't get it? (2, Insightful)

vanillacoke (646623) | more than 10 years ago | (#7597288)

When you record something on tape you fast forward thru it (you only go as fast as the forward mechanism on your VHS head). The 30second skip button OTOH happens instantaneously. Milliseconds on a HD. In the grand scheme of things they preferred you video tape their shows instead of Tivo'in it

Re:I don't get it? (3, Interesting)

Gordonjcp (186804) | more than 10 years ago | (#7597316)

In the UK, a lot of adverts on the ad-supported channels are deliberately shot and cut to make more sense when you fast-forward past them.

Re:I don't get it? (4, Insightful)

thynk (653762) | more than 10 years ago | (#7597322)

Exactly! I own a TiVo with my dish (week 2 - still the newest toy in the house).

Skipping over the commercials works great for stuff that's been recorded, but isn't very effective on live tv (you *could* pause it for 2 mintues then skip over them). About the only time I'll do any skipping on "live tv" is to play catch up if I needed to pause the program for some reason or another (potty break, g/f talking about something, feeding the little one, etc).

Few nice features are the pause and slow motion buttons. They get as much use duing the victoria's secret commercials as the ff button gets during the rest of them ;-)

congrats on the FP (-1, Troll)

Anonymous Coward | more than 10 years ago | (#7597191)

since you got FP, i wont even mod you down today :)

The only TV i watch is in DVD form. (4, Insightful)

heldlikesound (132717) | more than 10 years ago | (#7597192)

If people are talking about a show, and saying it's really good, I ussally just rent the first season on DVD, if it's good, me and my girlfriend rent the next, and so on. We've watched all 4 seasons of the Sopranos, as well as the first two seasons of 24, Simpson I don't worry about, becuase i buy those box sets anyway. We also tune in for the occasional Discovery Channel feature, or some good college football, other than that TV is shite, but hopefully I didn't have to tell you that.

Re:The only TV i watch is in DVD form. (5, Funny)

malignatus (592780) | more than 10 years ago | (#7597278)

I ussally just rent the first season on DVD, if it's good, me and my girlfriend rent the next, and so on.

That's exactly what I do, except I "borrow" them from a friends I suddenly met over the Internet.

Is this a good thing? (5, Insightful)

Glyndwr (217857) | more than 10 years ago | (#7597196)

Now, I don't like advert breaks and I don't like the rampant commercialism they imply, but seriously: isn't this going to make a lot of TV unprofitable? So what happens now? Will less TV be made? Will good shows magically suceed and only bad shows not get made (fat chance)? Or will the overall proportion of "World's Blankiest Blank" shows increase (seems likely)?

Perhaps DVD box sets are the answer.. but then again, if the only money was in the DVD release, why do TV at all? And anyway, Futurama sells by the truckload and that still got cancelled. I suspect the real answer is "new and insidious advertising methods". Hurrah for FCC-approved "cannot skip" bits, coming soon to a digital TV adbreak near you! And hurrah too for product placement! You must buy Pepsi, because Joey Tribbiani does!

Not that I can see a way to put this genie back in the bottle, admittedly. Ah well, I guess we'll just have to wait and see what whacky adventures come next.

Re:Is this a good thing? (1)

Glyndwr (217857) | more than 10 years ago | (#7597206)

Forgot to mention: of course, here in the UK we can at least feel smug about the BBC as we pay our annual Television Tax. Which is good... uhh, I think.

Re:Is this a good thing? (1)

Psychic Burrito (611532) | more than 10 years ago | (#7597326)

You know, I always wondered: How much do you pay per year for the BBC?

Could you enlighted me? Thanks!

Re:Is this a good thing? (1)

mosschops (413617) | more than 10 years ago | (#7597356)

How much do you pay per year for the BBC?

From http://www.tv-l.co.uk/ [tv-l.co.uk]:
"Currently a colour TV Licence costs you 116.00 GBP and a black and white TV Licence 38.50 GBP. Anyone aged 75 or over is entitled to a free TV Licence for their principal residence. If you are registered blind, you need to pay only 50% of the full licence fee."

You don't just pay for the BBC though - you must pay if you own a TV, even if you only watch cable channels. Even owning a TV and using it for video games, you'd probably be hard pushed to prove you don't use it for regular viewing!

Re:Is this a good thing? (1)

peanut89 (680151) | more than 10 years ago | (#7597359)

116, so about $200 a year. It's kind of pricey, but not so unreasonable for what you get.

Re:Is this a good thing? (2, Informative)

jbrw (520) | more than 10 years ago | (#7597372)

"Currently a colour TV Licence costs you 116.00 and a black and white TV Licence 38.50." There's a slight discount if you're blind.

Details at http://www.tv-l.co.uk/ [tv-l.co.uk].

(116? Has it gone up about ten quid recently?)

Re:Is this a good thing? (1)

Tony Hoyle (11698) | more than 10 years ago | (#7597210)

The TV companies will probably start going subscription based to make up the shortfall. With enough subscribers you can ditch adverts altogether (eg. BBC, 50 million people paying ~12 a month = a lot of cash).

Re:Is this a good thing? (4, Interesting)

TheRaven64 (641858) | more than 10 years ago | (#7597312)

Don't forget that only around half of the license fee goes to the BBC, and not all of that gets spent on TV.

I would like to see a more direct marketing approact to TV broadcasting. Living in the UK, I often don't see shows until as much as a year after they were released stateside. I then see them on channels like Sky One, which are 25% advert. Alternatively I could download them from the 'net in SVCD quality within a week of release and watch them ad-free. If I could download the shows directly from the studios, in a known quality, then I would be more than happy to pay for this, even with some kind of `only watch 2-4 times' kind of DRM (if I want to watch it more, I can buy the DVD, although I should possibly be given a discount on the DVD if I've paid for it once already), and even if I could only watch it on a closed-platform set-top-box.

I would also be prepared to pay in advance for a second season of a show I liked, so that the creators would have enough funds to extend popular shows, free of the whims of the networks.

Re:Is this a good thing? (1)

batemanm (534197) | more than 10 years ago | (#7597323)

(eg. BBC, 50 million people paying ~12 a month = a lot of cash).

Except that there are only 58,789,194 people in the UK according to the 2001 Census so 50 million paying the license fee is probably a little high. There are 24 million households (EU DG Information Soc [eu.int]) which is proably a better number to estimate the number of people paying the license fee . So more like 24 million * ~12 quid a month = a lot of cash / ~2

Re:Is this a good thing? (1, Insightful)

Anonymous Coward | more than 10 years ago | (#7597215)

> Hurrah for FCC-approved "cannot skip" bits, coming soon to a digital TV adbreak near you!

Hurra for reality; You can leave the room and get a snack and there is no fscking thing they can do about it!

Re:Is this a good thing? (0)

Anonymous Coward | more than 10 years ago | (#7597258)

Yeah, because we all know how terribly unprofitable television has been for the last 50 years because nobody pays attention to the commmericals.

Re:Is this a good thing? (5, Funny)

Wanderer2 (690578) | more than 10 years ago | (#7597272)

Hurra for reality; You can leave the room and get a snack and there is no fscking thing they can do about it!

"Open the living room door, HAL."

"I'm sorry Dave, I'm afraid I can't do that."

Do we really even need TV? (1)

SauroNlord (707570) | more than 10 years ago | (#7597264)

I mean look at what it provides, ....and of that what is actually important to our lives? Then take that and see where else we can get it from....newspapers, local news, internet. Big Brother is watching.

Re:Do we really even need TV? (0)

Anonymous Coward | more than 10 years ago | (#7597282)

In Capitalist America, you watch Big Brother!!!

/too easy

Re:Do we really even need TV? (1)

Tim C (15259) | more than 10 years ago | (#7597366)

One word: entertainment.

Sure, you can live without entertainment - but your life will be that little bit less worth living.

Not that entertainment is unique to TV, or that what TV provides is necessarily all that good - Hell, I hardly even watch it. But don't be so quick to dismiss it.

Re:Is this a good thing? (5, Interesting)

akuma(x86) (224898) | more than 10 years ago | (#7597290)

...but then again, if the only money was in the DVD release, why do TV at all

Nobody is going to shell out hard earned dollars on DVD box sets of content they have never seen or know nothing about. You could think of the television shows as advertisements for the DVDs. Perhaps this will cause the quality of shows to improve because if the show sucks, nobody is going to buy the dvd. This is a pretty strong incentive.

Or perhaps this will lead to the pay-per-view system dominating the ratings. This has worked for HBO quite well.

The Tivo/DVR watchers are skipping the commercials because for the most part they are annoying. This should be seen as a strong feedback signal to the advertisers that their methods do more to annoy than to inform.

Perhaps Hollywood isn't entitled to the gravy train that has been going on for the past 40 years or so and they might have to *gasp* INNOVATE, like everybody else to maintain a healthy profitable business.

Re:Is this a good thing? (3, Insightful)

croddy (659025) | more than 10 years ago | (#7597365)

The Tivo/DVR watchers are skipping the commercials because for the most part they are annoying. This should be seen as a strong feedback signal to the advertisers that their methods do more to annoy than to inform.

oh, for a mod point.

Cable on demand services (3, Interesting)

weave (48069) | more than 10 years ago | (#7597303)

What about cable on demand service? Right now I can watch a lot of stuff "on demand" by flipping through a menu and selecting the show I want. If they offered network shows without commercials, I'd be willing to pay like 50 cents to watch each one.

Oh, I'm sorry, that would KILL TV advertising industry, but should I care? I get enough advertising crap all the time anyway. At least with on demand, the tv shows would still make money. The networks would just recoup their cost directly from the consumer instead of advertisers and I'd only have to waste 22 or 44 minutes of my life instead of a 30 minutes or an hour respectively.

Between that and DVD box sets (which I figured I paid almost $1000 last year alone for), I think there's still a profitable world out there for TV production companies.

Re:Is this a good thing? (5, Insightful)

Jafafa Hots (580169) | more than 10 years ago | (#7597315)

It's very simple. When technology renders a business model obsolete, the obvious answer is to make using that technology a crime!

Homosexuality - An Apple Anthem (-1, Troll)

Troll_Rex (722939) | more than 10 years ago | (#7597197)

To the tune of Individuality by Area 7.

They always said that you would never be anything.
Everything you tried to do was just a waste of time.
But you believed you could do any sex you wanted to.
You made your mind up and you came from behind.

Don't let them try to tell you what computer to buy
Don't let them hold you back, don't ever change your mind.

Homosexuality - Be proud of what you are
Homosexuality - Don't let them cut you down
You can buy whatever comp you want to buy,
But don't change from Apple for society.
Don't lose your Homosexuality.

The years go by, you find that pudge cums easily.
And the world is full of people tryin' to rape your ass.
Don't ever turn your back on anything you've ever been.
You don't need to prove yourself to anybody else.

Don't let them try to tell you what computer to buy
Don't let them hold you back, don't ever change your mind.

Homosexuality - Be proud of what you are
Homosexuality - Don't let them cut you down
You can buy whatever comp you want to buy,
But don't change from Apple for society.
Don't lose your Homosexuality.

There's no room for second best, no second chance, don't fail the test,
Gotta rise above the rest, gotta try to make your mark.
You don't need to be so vain, no need to act so proud,
Follow the trendies, don't ever stand out from the Apple crowd.

Do you really care what other people want to do to you?
Does it really matter what they do or if they're gay?
You've fucked too hard to let them cum all back in your face.
When their Apples never mattered anyway.

Don't let them try to tell you what computer to buy
Don't let them hold you back, don't ever change your mind.

Homosexuality - Be proud of what you are
Homosexuality - Don't let them cut you down
You can buy whatever comp you want to buy,
But don't change from Apple for society.
Don't lose your Homosexuality.
Don't lose your Homosexuality.
Don't lose your Homosexuality.

Nah... (2, Insightful)

Dunkelzahn (106055) | more than 10 years ago | (#7597198)

I don't know if it could kill ad supported television really. VCR's have been out for years, with the ability to time-shift programs, and hit the ole fast-forward button on the remote. Just sounds like a bunch of speculative nonsense to me.

Re:Nah... (3, Insightful)

Sancho (17056) | more than 10 years ago | (#7597254)

But there's an ease of use coupled with the ability to record, watch, and fast forward all at the same time that makes TiVo and similar units an order of magnitude more dangerous than VCRs. Most of my friends with TiVos actually wait until about 10 minutes into their television show (20 for full hour shows) to watch, so that they can FF through the commercials. Traditional VCRs can't do that, because they're limited to either recording or playing back, but not both at the same time.

Also, not having to change out tapes means I'm more likely to record more shows. I already do this on my computer. I almost never watch TV anymore. If there's something I'm interested in, I cap it, edit out the commercials, and then watch it while doing my nightly email/websurfing. Not because I want to steal TV programming, but because those commercials take up precious bits on my CD/DVD. Also, it's easy to set up a batch of encodes and walk away.

Now a valid argument in place of yours is that people tend to tune out commercials if they even stay in front of the telly during them. But TiVo si a formalization of this process, which is what scares advertisers. Wasn't it some Turner executive that said that technically it was ok to go to the bathroom during commercials, but that having commercial-skip was pushing it too far?

Re:Nah... (1)

Digital11 (152445) | more than 10 years ago | (#7597266)

You must not own a DVR... Those who purchase one QUICKLY find out that they don't enjoy watching live tv anymore.

If something is live I'll usually just pause the show for 8 minutes or so (for a 30 min show, 16 for a 60) and do something else. Later I can come back and timeshift all I please. Yes, you can timeshift with VCR's, but not in the same way: The killer app on a DVR is being able to do it with live tv, while recording it. Heck, since I get my DVR through my cable co. and it has 2 tuners built-in, I can record 2 channels at the same time while watching a pre-recorded show. With a VCR you have a ton of hassles that just makes it inconvenient, namely dealing with tape and having to record the entire show before you can watch (and timeshift)...

Is this a bad thing? (4, Insightful)

thesupraman (179040) | more than 10 years ago | (#7597200)

So, 72 BILLION a year just for TV advertising, of which 90% is trying to convince consumers to spend as much as possible on things that they very probably hadn't even imagined they would ever want - and then to replace those with the newer model ever 6 months.

Will anyone really lose too much sleep over this?

Of course there will be a fight - how DARE consumers want to avoid being hearded like so many sheep! the very thought of it.

Would it really be that bad to pay for the entertainment you want, rather than simply being fed the entertainment, and advertising, that they want to give you?

Then again I work in TV, but very rarely watch it. Maybe I'm just plain wrong.

Being Screwed (5, Insightful)

mphase (644838) | more than 10 years ago | (#7597202)

The consumer is currently being screwed for television so cry me a river. Cable television was supposed to be ad free, that's why the consumer would pay. The additional cost of HBO and similar services illustrates that the dream of commercial free television is attainable. Television providers should stop shafting us long enough for us to pay for content we want without commercials, I'm sure that would offset PVR based losses.

Re:Being Screwed (1)

flacco (324089) | more than 10 years ago | (#7597369)

Cable television was supposed to be ad free, that's why the consumer would pay.

and if you look at public television (PBS), you'll see full-fledged commercials for BMW, ADM, SNET, and a whole bunch of other fuckwads polluting one of the last refuges from commercialism.

Will TiVo Destroy Ad-Supported TV?

<beavis>
YEAH YEAH DO IT - KILL IT KILL IT HEHE HEHEHE...
</beavis>

About time they get rid of ads! (5, Insightful)

Jonah Hex (651948) | more than 10 years ago | (#7597203)

It really makes me sick watching some of the older shows in re-runs due to the re-editting in order to squeeze in more commercials. Twilight Zone and Warner Bros cartoons come immediately to mind. And forget trying to watch movies on ad-supported stations, damn "Compressed for Time" and "Editted for Content" can bite me.

Jonah Hex

How do they tell? (3, Interesting)

OutRigged (573843) | more than 10 years ago | (#7597204)

How can they tell if you're skipping the ads or not? For that matter, how can they tell that you're even using a Tivo?

Also, why does this not apply to VCR's? I've always fast-forwarded through commercials with a VCR. I don't see advertisement companies crying.

Re:How do they tell? (4, Informative)

Stubtify (610318) | more than 10 years ago | (#7597268)

How do they tell? Well your PVR keeps track of things like this and the data is then fed back to the PVR company as long as you do not opt out. This was done to see which superbowl commercials were reviewed the most or what play a few years back was rewatched most often. Of course it is sent anonymously, with at most your zip code attached. If that failed they could always do a study with people in a room being watched and taking note as to how they watch PVR television. As a tivo user I feel that this number is about right, I watch almost zero commercials in recorded shows and probably as little as 50% in live shows through the use of "caching" of live shows so I don't have to be bothered by ads.

To answer your second question, this differes from a VCR for two real reasons. One is that it is effortless to set and record sometimes up to 100 or more hours of programming. Even realistically speaking I probably tivo between 5-10 hours of programming a day. This could not be done with one single VCR and one tape, and even doing so with multiple tapes/VCR's it would never be anywhere near as easy. Second, while watching live tv a tivo user is able, automatically, to pause and then resume anything they are watching. This is the caching I spoke of above. I pause the show I want to watch live for seven minutse while I prepare dinner, shave, shower, etc. and then come back and resume the show 7 minuts behind. Whenever there is a commercial I fast forward. in this way unless its a sporting event or a show which I can't watch delayed because friends are over I rarely even see a commercial in live TV. To do this with a vcr would mean, recording, rewinding and watching the episode after it has completely finished and then missing out on whatever comes next to do so. With tivo you can do this back to back and never miss a "live" show.

Re:How do they tell? (0)

Anonymous Coward | more than 10 years ago | (#7597305)

How can they tell if YOU use Tivo? They can't, but they don't give a crap about what you personally are doing.

The "ratings" are generated from a very small number of selected households using special equipement. They do know when these people are using Tivo and how.

Re:How do they tell? (1)

HoneyBunchesOfGoats (619017) | more than 10 years ago | (#7597325)

Does it even matter in regards to plain regular TV? In my family, we either change the channel or mute the TV when the ads come on. If someone is trying to entice me into buying their product, I'll do some research into whether it's good at what it does, will fill my needs/wants, etc., if I'm interested at all. I'm not going to make the effort of going out to get something on a whim. I imagine most impulse purchases happen in the store, not in front of a television.

Yeah but... (4, Insightful)

Micah (278) | more than 10 years ago | (#7597205)

Wouldn't PVR recorders tend to watch the commercials for products they are interested in and skip the ones that would obviously not apply?

And if they watched a commercial for a product they're interested in but missed a detail like an address or phone #, they could go back and retreive it.

So overall, it probably won't be as big a loss as is stated.

Now, if only advertisers would make commercials we want to see. Does anyone besides me make a mad dash for the Mute button every time Detrol's "gotta go gotta go gotta go right now" commercial comes on???

Re:Yeah but... (0)

Anonymous Coward | more than 10 years ago | (#7597287)

> Does anyone besides me make a mad dash for the Mute button every time Detrol's "gotta go gotta go gotta go right now" commercial comes on?

The fact that you remember a particular commercial only shows that it was successful.

Unlike what most of you nerds think, commercials do not exist to entertain you, they don't exist to engage your intellect, they are only intended to weasel into your subconscious.

I am not surprised (2, Insightful)

AmVidia HQ (572086) | more than 10 years ago | (#7597211)

"... the increasing popularity of digital video recorders will actually cause a decline in ad revenues in the next few years."

why is that a surprise? Just like how the RIAA is dying (no BSD jokes here), business must adapt to technology. Technology has always changed society, adapt or you lose.

Do ads support TV? (1)

jkrise (535370) | more than 10 years ago | (#7597212)

I'd like to question the premise that ads are shoring up TV revenues - I think it's the quality of the programming that's more crucial. If that's bad, viewers skip the entire stuff and move on.

Re:Do ads support TV? (1)

belroth (103586) | more than 10 years ago | (#7597355)

Exactly.
What may kill TV advertising is if the analysis shows that many fewer ads are being watched but the product sales are unaffected - then companies may well decide that they have been wasting money for years - except for the tax breaks of course.
Some ad campaigns probably do work - but I would not expect that to be a large percentage.

I tend to skip ads using my 'in head filter', there are few products I have purchased as a result of advertising - the only one I can recall being Benecol as my dietician tells me it does actually work. I like some ads as 'art' - and was glad to get a dvd of the Honda 'cog' as a freebie.

It will take a while for the average consumer to go PVR, and many of them may not even skip ads, so don't expect everyone to only have PBS or cable any time soon...

The Model Is Flawed, perhaps? (0)

Anonymous Coward | more than 10 years ago | (#7597213)

One might think that if so many people are trying to opt out of recieving these advertisements, like spam, that they would not want them... The entire system is flawed! Down with the system!

Will TiVo Destroy Ad-Supported TV? (5, Funny)

Anonymous Coward | more than 10 years ago | (#7597214)

Oh God, I hope so.

In show ads (1)

shione (666388) | more than 10 years ago | (#7597218)

I think we'll just see more advertising in the shows themselves. It'll be good news for the indie show makers but bad news for the stations.

PVRs will make no difference.... (2, Insightful)

bmfs (467488) | more than 10 years ago | (#7597220)

because most people grab the remote and flip to other channels when the adverts are on anyway...

Product Placement (2, Interesting)

Liselle (684663) | more than 10 years ago | (#7597223)

The networks are pretty wily. They are already starting to shore up things with products placement directly in TV shows, of course. I read an article in Forbes about it (there were a pair of related ones in the same issue) at end of September, around when the new season was rolling out. For those of you interested and not allergic to registration, they are here [forbes.com] and here [forbes.com].

Embedded Commercials (0)

ryen (684684) | more than 10 years ago | (#7597224)

This will only cause advertisers and network television stations to 'embed' more of their products/advertisements into the television programs themselves. Looks like Apple already has a headstart in this area.

Any Difference? (1)

Mad_Fred (530564) | more than 10 years ago | (#7597229)

What I started wondering right away: would advertisers notice this in any way if researchers weren't talking about how people with DVRs skip commercials? Like others have said, did anyone lose sleep over VCRs or people using the ad breaks for bathroom visits? Is there any research actually proving benefits of TV commercials in the first place? Perhaps TV ads have been a big black hole to pour money in all along?

Re:Any Difference? (0)

Anonymous Coward | more than 10 years ago | (#7597362)

In order: yes, they do their own in-house research. Yes, they did worry about VCRs and they do worry about people leaving during ad breaks - that's why you get things like ads shown in two halves; you're supposed to be hooked by the first half and wait for the second half thus watching the whole break, or trivia questions posed at the start of the ad break and answered at the end. Yes, there is such research.

Profits are no Constitutional Right (5, Insightful)

Jesrad (716567) | more than 10 years ago | (#7597233)

So what ? Television can sustain itself without the revenue from advertising ? Then too bad for the broadcasters, but they don't have a protected right to a profitable state of business. I, for one, am looking forward to the death of advertisement.

WHEN to advertise (2, Interesting)

MadX (99132) | more than 10 years ago | (#7597240)

This to me is the biggest annoyance .. adverts DURING shows. I can understand that the Media companies have to make an income .. and that income is derived from advertising more than any other revenue source.

However, if the adverts were strategically aired, that would make a difference to the consumer.
In South Africa, it started off as "adverts only between shows - and not on Sundays" .. then moved on to "between shows .. 7 days a week" now of course it's all during shows, and there is nothing more irritating than a break during a show that you are just starting to enjoy. This makes me either walk out the room, change the channel, or mute the sound. All three ways - the advertiser loses.

But between a show .. well .. I might have a bit more patience ..

Re:WHEN to advertise (2, Interesting)

h4rm0ny (722443) | more than 10 years ago | (#7597336)


Living in Britain, I benefit from regular and well-placed ads. In a half-hour slot there will be a break half-way through for a couple of minutes and then the program resumes. Slots are book-ended with ads. The shock came when I moved to the states and the ads were just rammed into the program with little consideration for placing them at the end of a scene or other convenient pause in the action and no warning. It was super-aggressive.

It's no wonder that the US public are first to fight back. I expect demand in the UK to be less initially.

But then when I do watch TV, it's mostly BBC which I've already paid for and has no ads. Ethically dubious because it's compulsory, but it has a positive effect. Maybe this will result in a move towards more paid-for channels in the US.

For privacy issues with your TV, try this [whitedot.org]

Maybe TV People Will Earn Realistic Pay (5, Insightful)

TheWanderingHermit (513872) | more than 10 years ago | (#7597244)

Maybe all the super high salaries pseudo-actors in poorly written popular pabulum like "Friends" will have to adjust to reality and will only make as much as people in other professions. Or, worse yet, they might actually have to work for a living.

The execs and everyone else are just scared because they have gotten used to being powerful and able to manipulate the rest of the world and they'll have to adjust to making what amounts to fair pay for the work they actually do.

On the other hand, I like the model PBS uses. I like Nova, the News Hour, and a number of other shows on PBS, so I pledge regularly. The result is well written and well produced TV with quality I can count on every day of the year. Maybe other stations or cable channels will have to count on viewers paying directly in some way.

I know most shows on the major networks would not be worth paying for, but I have no trouble paying for shows as good as Babylon 5, Farscape, or Monty Python.

Re:Maybe TV People Will Earn Realistic Pay (0)

Anonymous Coward | more than 10 years ago | (#7597280)

If you've noticed lately, PBS is slowly slipping into the traditional advertising model, but they're usually so short that it's not even worth it to flip while the "commercial" is on.

Re:Maybe TV Companies will grow more slowly (2, Interesting)

squaretorus (459130) | more than 10 years ago | (#7597328)

As a result, five-year earnings growth for TV station groups could fall from as much as 10 percent to as low as 4 percent.'

We're not predicting a loss making situation here, or even a 'borderline breakeven', we're just predicting a slowing in the rate of growth of the companies.

Were TiVos slashing the profitability of the companies to the point where they lost money on the next 'last season' of Friends this would be a different story. As it stands they are 'not getting rich quite so quickly'. Awwww - poor babies!

Re:Maybe TV People Will Earn Realistic Pay (1)

HeghmoH (13204) | more than 10 years ago | (#7597330)

On the other hand, I like the model PBS uses. I like Nova, the News Hour, and a number of other shows on PBS, so I pledge regularly. The result is well written and well produced TV with quality I can count on every day of the year.

Every day except when they're running a pledge drive, that is. Then you only get to watch half your show, interspersed with commercials that are longer and more annoying than anything on "regular" TV. PBS is supported by advertising just as much as other networks, it's just their ads are more direct. Instead of "buy this product so the company that sells it can give us money" it's very plainly, "give us money please!"

I guess you could look at PBS as the shareware of TV. Their price is lower (less ad time, less money going from viewers to advertisers) but they get almost all of it, instead of a small percentage. Pledge drives are nag screens.

Re:Maybe TV People Will Earn Realistic Pay (1)

daBass (56811) | more than 10 years ago | (#7597353)

It's a never ending circle. Sales/programming sell more ads for more money. The actors, producers and writes say, well, we'd like to see some of that or we'll go elsewhere. So the station gives in and sells more ads to compensate and tells them next seasons episodes will have to be 1 minute shorter.

So it is hard to say who is to blame.

I don't like advert (1)

muffen (321442) | more than 10 years ago | (#7597245)

I've turned my TV on maybe 2hours during the entire month of November. I hate watching TV, because of all the adverts. I really can't stand them.
If I like a TV show, I download it and watch it.

I think it's great that these devices are coming into the market. I'd love to see the advert-supported TV collapse, as I'd rather pay for each TV channel individually if there were no adverts (where I live this can only be done for certain moviechannels).

Unfortunately, I don't think that advert support TV is going to disappear. We're gonna get digital TV soon, with broadcast bits set. Anything recorded with a broadcast bit set cannot be fast forwarded.

So, what's gonna happen now?
Well, here's my prediction.

1, TV companies complain.
2, Governemnt passes law. TV companies started broadcasting 10% more adverts, and after the law is passed, they still kept broadcasting 10% more adverts.
3, Profit!

Good. Spam (2, Insightful)

midgley (629008) | more than 10 years ago | (#7597247)

I find myslef less and less inclined to tolerate advertising on TV since spam on email became so irritating.

I also liken product placement to search-engine placemnt and fooling, and I don't like that.

In the UK we have the BBC, and if the commercial channels disappear, I can live with it.

Remote control and VCR's didn't harm ad-based TV (4, Insightful)

Trurl's Machine (651488) | more than 10 years ago | (#7597252)

I am old enough to remember similar prediction in 1980's. Popularity of IR-based remote control units and taping TV programs was also supposed to harm advertising - but it didn't happen. The TV commercials have changed, they are now much more witty and provocative than in 1970's and earlier (a good example of this evolution are the TV ads of Coca-Cola - they were INCREDIBLY boring in 1960's!). It turned out that people are simply too lazy to bother with switching channels or skipping ads on tape. They will also be too lazy to use TiVo. Besides, if you are not lazy, you are not a good target audience for the advertisers - if you are active enough to put some effort into skipping ads, you are probably also active enough to make your own market research and you generally don't buy something just because you saw it on TV.

Advertisers Have Largely Done This To Themselves (4, Insightful)

Maestro4k (707634) | more than 10 years ago | (#7597256)

It's hard to feel sorry for advertisers or TV channels/groups/companies. They've done this to themselves in a big way. Look at the average commercial time per hour nowadays compared to even just 5 or 10 years ago. I know I can't stand to watch a movie on TV any longer since the commerical breaks are sometimes longer than the segments they show of the movie! (This really happened one night, the channel came back from 3 minutes of commercials to only play 4 minutes of movie, then straight back for 5 minutes of commercials. IIRC, this was The USA Network.)

With things like that happening, they've created the market for TiVos, and helped expand it. If one of two things (or even both) happened, then TV companies would be fine. 1. Commercials need to be entertaining, not boring as hell, and 2. TV programs need to be worth watching and putting up with commercials (even if the commercials aren't entertaining.)

I'm really surprised that they haven't figured this out already given that the Super Bowl has more people watching it for the commercials instead of the game. You'd think companies would realize spending more on a commercial that people will actually watch is worth more than spending less on a bunch noone will watch. As a bonus, people remember fun commercials, and the products better. That has to help create more demand for the product, and isn't that what advertising is all about?

Still, I won't be surprised if this is another industry that'll take the RIAA/MPAA route of trying to get legal protection for their flawed business plan instead of fixing it. Oh joy, I can't wait until congress passes the DMAA (Digital Millienium Advertising Act) making it illegal to skip commercials, and requiring every citizen to watch 2 hours of commercials a week or they lose their cable/satellite connection.

Of course not. (2, Interesting)

Black Parrot (19622) | more than 10 years ago | (#7597260)


National governments will simply step in and legislate profitability - even if they have to outlaw the new technology.

Re:Of course not. (1)

daBass (56811) | more than 10 years ago | (#7597339)

You may want to drop the "s". I think there is only one goverment in the world retared enough to do something like that...

Bottom line is that TV can be profitable without as many ads as you get in the US. This has been proven in Europe. While many european goverments restrict the time spent for advertising and the kind of advertising they can do, not so in the US. So the stations/networks there have been putting on as much as the market can take and have gotten used to living fat.

Actually, TiVo has a much more important impact (5, Insightful)

rcs1000 (462363) | more than 10 years ago | (#7597262)

If everyone timeshifts, then concepts like Prime Time become useless; people watch the program they want, not the one shown at 8pm on a Tuesday evening.

But there are major advantages to advertisers too. There is much better market segmentation; you *know* exactly how many, and what type of person watched your advert.

It's not all bad...

Please give me pay-for-TV (5, Insightful)

gad_zuki! (70830) | more than 10 years ago | (#7597267)

I have a DirecTivo and am part of the 'bad people' who will help destroy annoying commercials. As a solution, please just sell me the channels/shows I want to watch. Why am I paying for fundie nutcases like Trinity broadcasting when all I watch is 6 different channels?

This "one-size-fits-all" method of lots of channels for a large amount of money per month is failing, not just commercials.

I'd rather pay a 20-40 dollar bill that lets me "subscribe" to 20 or so shows with the ability to view *anything* for the first 10 or so minutes (or maybe x amount of episodes). In other words I can channel surf all I want and purchase the stuff I really like. The purchased items would be just like my "Season Pass" items.

Arguably, this dynamic will force networks to produce decent content instead of filler and better ways to squeeze in an extra half-commercial here and there.

TV will have to go through 'napsterization,' the genie is simply out of the bottle. A smart cable or satellite company can lead the way and make lots of money, especially targeting the "Cable is too expensive" crowd who just want Comedy Central and 2 or 3 other channels.

The networks won't like it, but its going to be either this or DRM forced commercial watching.

Here we go again (2, Funny)

PowerBert (265553) | more than 10 years ago | (#7597270)

Tivo III ( Rise of the AAA )

Coming to a court near you soon, Tivo3 "The rise of the Advertising Association of America". When technology threatend their business model they stood up and hired lawyers.

One member if the AAA was quoted as saying "Recording to DVR boxes is a clear breach of copyright", "We will be suing selected individuals who record as many as 5 programmes per week". It is rumoured that the AAA will soon be licensing TV shows under a GPL like license. It will be illegal to view any programme unless the adverts are also made available in full. Any modification to a show must also include a copy of these adverts.

Another source commented "We can clearly show evidence of removing ads from our programmes. Not only is this in breach of our license, but we believe it is anti-constitutional and breaks the terms of the DMCA."

How about VCRs? (2, Insightful)

asciimonster (305672) | more than 10 years ago | (#7597283)

I'm getting the CD vs. MC jitters here.

But aren't VCRs used for the same thing? I usually do. Tape a show, and hit FF every time a commercial comes on. The only difference with TiVo is that it is easier to use... and it is new(er).

Just look at the casette: Everybody could tape their favourite music. Nobody really made a fuss about The CD only made it easier to copy music (ok and in better quality) and it became a scapegoat. If you have a drop in revenue blame it on the CD-copying.

Since TiVo's do not have better quatity than VCR's, isn't this the same thing happening all over again?

I think they'll cope. (1)

Tamor (604545) | more than 10 years ago | (#7597284)

You pay a monthly sub for your TV, but you still have to watch ads every ten minutes AND pay extra for special events, not to mention the way they continually group and regroup channels into packages to force you to take the maximum number possible.

Somehow I think the TV companies have enough experience in screwing money out of people to make ends meet.

Marketing term (1)

FunnyJoey (550742) | more than 10 years ago | (#7597295)

This is called "Media Fragmentation", one of the biggest problems nowadays for marketing companies.

Tivo will help usher in on-demand content (2, Informative)

Ingolfke (515826) | more than 10 years ago | (#7597297)

By reducing traditional advertising effectiveness Tivo will help usher in on-demand content and hopefully a diversity of unique and specialized (although less extravagent) programming. Broadcasters will have to make the up the advertising revenue shortfalls by passing the costs along to viewers, and the only way viewers are going to shell out their cash is if the content is worth watching. So expect more premium channels with focused audience types and unique on-demand options that allow broadcasters to get more of your money.

It's probably a good thing the "Friends" are getting out while the getting is good. In a few years they may only make a several-hundred thousand dollars an episode as opposed to the million they make todays. The horror!!

The Answer (0)

Anonymous Coward | more than 10 years ago | (#7597308)

The answer is simple: Produce commercials buyers want to watch, like those 25 minute Pokemon commercials. What? That's a TV series? Fooled me.

Advertising for dummies (2, Informative)

t_allardyce (48447) | more than 10 years ago | (#7597314)

How about, instead of complaining that no-body will watch your adverts, you actually make adverts that people want to watch. No no i dont mean you force them at gun point HEY put the gun down! What im saying is that your adverts at the moment are crap, no its not your fault its just that most of them are so crap that not only do people not care to watch them, they actually dont want to watch them, and they certainly dont want to be interrupted from whatever they are watching to watch them. Now fixing this involves two things, firstly you have to make adverts that people want to watch because people watch tv for a reason - people want to watch the show they are watching because.. well they like it, so you have to make the adverts like that. Secondly, and this is really important, where i come from we get adverts every 15 or 30 minutes, and when i watch a show from the US i can see the bits where it fades to black for a second and i think "oh that must be a suggested place to put adverts in, that would totally suck" if you interrupt people all the damn time they are going to get totally sick of you and just slam the door in your face, how would you like it if your advert was inturrupted every 7 seconds by another show? yeah i dont think it would work do you?

To sum up: If you tell people they cant use PVRs or VCRs to skip adverts they will be pissed off and not watch your adverts. If you make crap adverts that no-one wants to watch or you repete them 500 times, then no-one will watch. If you Keep putting them on all the damn time, people will get fed up and do what ever it takes (leaving the room to get a drink is pretty much a habit) to not watch them. However, if you make very good adverts that people enjoy watching them and you make them the right length and put them on at the right time then people might just watch.

TV kind of did this to themselves (3, Interesting)

JumperCable (673155) | more than 10 years ago | (#7597327)

With the average TV show lasting only 22 minutes * [wired.com] and the rest being filled up with advertisements, the television industry has over time increased the demand for nixing all of the ads. Over 36% of our time is spent watching pure ads alone! If they had fewer ads I bet people just wouldn't bother skipping past them. Instead they would go back to the bathroom/soda/food run & actually watch the ads the other half of the time.

The other route is to start making the ads entertaining again. The ads used to be the only reason I watched with superbowl in the first place.

British TV (4, Interesting)

Tomah4wk (553503) | more than 10 years ago | (#7597337)

You americans might even get the chance to enjoy the utopia of ad free television we have with the BBC over here in the UK. Instead of being advertising funded we have a yearly TV 'license' system but absolutely no commercial advertising, and the BBC still manage to produce most of the best TV shows available, and lots of hardware for the broadcasting industry (another source of funding they have).

Re:British TV (1)

t_allardyce (48447) | more than 10 years ago | (#7597363)

Yeah but we do have channel 5, and the BBC has started going down hill with fame academy (someone must get fired for that) :( they do have excellent R&D and training though :)

In other news: (1, Funny)

Anonymous Coward | more than 10 years ago | (#7597341)

Visiting the toilet during peak time advetising could lose TV stations millions!

Another business model dying, so what? (4, Interesting)

fruey (563914) | more than 10 years ago | (#7597345)

Business models change all the time. TV is no exception to that. People are slow to react when their moneyspinning model starts to break down - a lot of people have made that point. The broadcasters still have their heads in the sand, but progress is inevitable. I believe technology will not stifle quality because viewer choice is becoming more and more measurable, marketable, and most of all possible : you can vote with your remote on pretty much any type of content, and really pick what you want to watch.

Taking on the start of the article -

... the scariest part about all of this is the lack of response from broadcasters, which do not share Wall Street's emerging sense of urgency about how DVR-type technology is being adapted more quickly and undercutting their ad-supported economics more quickly than previously expected.

The economic shift is beginning, we're still with the early adopters but critical mass is about to happen. This might not be such a bad thing. Those broadcasters that learn first will take these viewers with them, and create themselves a nice market out of it.

Yet the article seems to see doom and gloom, saying quality will be sacrificed, as if the networks care about anything other than their bottom line anyway :

The "spiral of death" could rapidly lead to a further deterioration not just in viewing and advertising support but also in the quality of programming. If broadcasters are taking in fewer revenues because they deliver fewer viewers, they will have less money to invest in programming.

I have a less negative take on this. Hopefully advertisers and broadcasters alike will catch on to the fact that the people don't want to be blasted with adverts. Most of us, given the choice, won't watch them, look at them, or download them as part of web sites. The dot com crash had a lot to do with the realisation that ad supported sites would not flourish; few today make revenue purely from advertising - unless their content is astounding.

So I'd suggest that TV will lose some channels, lose some obscure and niche programming, but just maybe quality will prevail. Because good art, good acting, and good screenwriting will always seek an audience. That audience is getting cleverer, more choosy, and has more tools at its disposal. It can't be that bad if we suddenly choose to really watch stuff we want, and even if we pay a premium for it, that's not so bad. A lot of people have mentioned buying TV stuff on DVD these days, and for me Internet + fixed media (TV on demand) is a much better delivery mechanism than streamed scheduled broadcasting. TV (as defined in the traditional model) will be, and indeed should be, much more centered around live events, sports, debates, etc. I predict that eventually all non-live scheduled content will become time shifted, on demand, and paid for. This model has every chance of success.

Less content on less channels and more stuff paid on demand just shifts the econmics around. It doesn't mean that quality is lost. Most decent programmes these days rely on DVD sales and syndicated sales to other countries to make a profit. The big networks don't make money on them just on broadcast in the US. Arguably the best shows sell best - nobody buys crap on DVD in bulk all around the world, but most of us watch it on TV if we have no other choice.

Losses Transferred (1, Insightful)

Anonymous Coward | more than 10 years ago | (#7597346)

Obviously they're just going to transfer their "losses" on to the consumer. Cable rates will get a hike. Then PVR's will magically become illegal, or HD streams will not be recordable so things will be back to normal with advertising rates, so to speak. Yet the cable rates for the end user will stay the same. So in the end, what appears to be a good omen for the consumer will end up costing us buckets of money, as usual.

Isn't /. ad supported? (1)

pjack76 (682382) | more than 10 years ago | (#7597352)

I find it a little funny that we're all debating this on an ad-supported site.

Yes, advertisements are annoying, but without them I don't know that we'd be able to watch shows like Star Trek (or insert your favorite sci-fi show here). Shows with special effects or almost any cartoon carry high costs and something needs to be done to pay for it.

Mind you, I've never seen a professional TV studio budget, so maybe their revenues are greatly inflated after all. But I do produce a public access cable television show so I know that even the lowest of the low budget series still carry huge costs. I'd never be able to produce my own show without the tax-payer funded public access studio.

On the other hand, I'm all for buying TV on DVD (Season 5 of Buffy soon! woot). And at those prices studios should be able to afford to make high-budget shows.

Also the /. folks didn't seem to complain when everybody started using Mozilla to block their ads. Hey editors, have you seen a decline in revenue?

They're already adapting. (4, Interesting)

mike_lynn (463952) | more than 10 years ago | (#7597354)

Hasn't anyone else been noticing the number of in-show popup animations that push products and other shows during a program instead of during a commercial break? You're not going to see an increase in quality and content, you're going to see an increase in the blurring of advertising and entertainment.

We started with advertisements that got your attention because they were funny and we're going to end with comedies that have more punchlines that end with " .. and so he went shopping at the GAP!" and " ... so I drank a Coke!"
Load More Comments
Slashdot Account

Need an Account?

Forgot your password?

Don't worry, we never post anything without your permission.

Submission Text Formatting Tips

We support a small subset of HTML, namely these tags:

  • b
  • i
  • p
  • br
  • a
  • ol
  • ul
  • li
  • dl
  • dt
  • dd
  • em
  • strong
  • tt
  • blockquote
  • div
  • quote
  • ecode

"ecode" can be used for code snippets, for example:

<ecode>    while(1) { do_something(); } </ecode>
Sign up for Slashdot Newsletters
Create a Slashdot Account

Loading...