Dish Network In Trouble Over Ad-Skipping DVR
May 25, 2012 4:06 AM
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Dish Network is heading to court with several major broadcasters, with a focus on skipping ads
Fox, NBC and CBS are taking Dish Network to court because of a new feature that allows subscribers to skip over commercials in recorded content.
Dish is currently the No. 2 satellite TV provider with 14 million subscribers, and also filed suit to make ad-skipping acceptable with an official judgment.
If the current dispute isn’t handled immediately, there is a chance that it could cause distributors to pull their content from Dish.
The company’s “AutoHop” feature is unique because subscribers are able to skip all of the commercials, instead of fast-forwarding and jumping in small segments. AutoHop isn’t available to all 14M subscribers, and can only be used to skip commercials for prime-time broadcast TV episodes.
“Viewers have been skipping commercials since the advent of the remote control," said David Shull, Dish Senior VP of programming, in a statement. “We are giving them a feature they want and that gives them more control."
As more TV viewers watch TV episodes and movies on-demand on their DVRs, advertisers and TV broadcasters are looking to better monetize their content. The TV ad industry nears $20 billion per year, but advertisers are increasingly worried about DVR viewers -- a continually growing number -- simply skipping ads of recorded programs.
Fox and several other major broadcasts prohibit users from fast forwarding through on-demand content, so they have to wait for the ads to finish. In its licensing agreement with Dish, for example, Fox says the provider can retransmit prime-time content, though fast forwarding through commercials is prohibited.
Dish doesn’t believe AutoHop will make a long-term impact on whether or not commercials are viewed, but the big four broadcasters and Time Warner Cable strongly disagree.
After the service was first announced, Dish reportedly welcomed input from broadcasters, but there were immediate rumors of possible lawsuits. It should prove interesting to see which side wins the court debate, because it could have a major ripple effect hitting advertisers and subscribers.
New York Times
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It seems like we are headed
5/25/2012 8:27:56 AM
towards much more intrusive advertising as the way to recoup ad revenue lost to both DVR and downloading of shows. Some type of constant advertising that takes over a portion of the screen even while the show is on is inevitable.
The only programs where traditional ads will continue to work is live broadcasts of sports, news, and other things that people want to watch as they happen.
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