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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RE: Replay TV Went Through This
5/25/2012 3:52:58 PM
Yes, sharing was definitely the biggest issue for Replay and one of the major legal points that caused their legal problems.
As for skipping commercials, we've been able to record and forward through commercials for quite a long time now with the VHS recorders previously and now DVRs. There's a slight difference here in that skipping is not forwarding, but I could stop a VHS tape and forward without watching the commercials too. It just wasn't convenient.
To me, big content distributors like the TV networks, music and such, need a big wake up call. They are applying an analog business model to a digital age. What they need to do is get their digital distribution in place now so it's available everywhere to every device in a low-friction way. If they do this they stand a better chance in the picture later. Without a digital distribution model, the content creators will find their own and dis-intermediate the current distributors. They also need to consider that sometimes it's better to give some content away so it reaches a larger audience that would normally never see it. If the TV networks gave their content away for free via digital distribution with their commercials intact they would have a much larger audience and could better attract advertisers. Some people would skip the commercials but many would also watch them.
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