3 Comments

Summary:

Dish Networks is selling a controversial device called the Hopper that lets viewers skip commercials. Company chairman Charlie Ergen said TV watching is changing and that Dish is not using the Hopper to extract lower fees from broadcasters.

Dish Networks Chairman Charlie Ergen denied that the satellite TV company’s Hopper DVR — which lets users wipe out commercials — is simply a tool to pressure broadcasters to lower transmission fees. “We don’t want to pay retransmission money but it’s not a leverage game. It’s really that tech has changed,” Ergen told an audience at the California media event Dive Into Media.

The Hopper DVR lets users record television and then instantly fast-forward past all the commercials. Today, Dish put out a new ad (yes, there’s some irony here) that offered an “in memorium” for TV commercials — the concept is that sitting through commercials is something people did in the past but no more.

The Hopper’s ability to skip ads is the subject of a heated legal dispute between Dish and broadcasters. So far, courts have refused to issue a preliminary injunction to shut down the service for copyright reasons. “The lawsuits going on today will ultimately decide the fate of commercials. Be careful what you wish for. If broadcsaters win, they’ll outlaw the DVR,” warned Ergen at the event. He says the service is legal under the law because it doesn’t erase the commercials, but simply lets consumers skip past them.

Some people in the Industry have suggested the fight over the Hopper is really a way for Dish to pressure broadcasters to lower retransmission fees — the money they charge Dish for the right to broadcast their over-the-air shows. While Ergen denied the Hopper is a leverage device, event host Peter Kafka pressed him on why the Hopper only fast-forwards past broadcast shows and not cable ones. Ergen claims this is due to technology limitations related to the way shows are streamed.

You’re subscribed! If you like, you can update your settings

  1. I say bravo Dish! It amazes me that more forward looking companies dont realize that display advertising is a dead medium and a completely ineffective promotion paradigm for marketing ROI!

    It’s about time someone had the audacity to say the long over eulogy over display advertising. RIP ads I look forward to your evolution!

  2. William Diaz ✔ Tuesday, February 12, 2013

    The Hopper – a product my parents love the most of Dish Network happens to have paved the way in the USA (albeit a very tiny paved path) for networks, cable and other satellite operators to move to a model like they have in Europe, specifically the UK. You PAY for the right to watch TV, PER TV licensing and by far less commercials.

    With the ability to skip the commercials, it shows that the model is in demand and technologically we are there today where we can tell networks an broadcasters that we want to pay per channel, a la carte, or move to a model where we pay per year for each television we have in our house. A competitive rate of course, but with Americans willing to pay for television, but skip commercials can become a lucrative market, but even more so, that since most people are moving from cable TV which charges a lot for things we dont want and still full of commercials we can move to the networks directly and pay them more than cable providers do per customer. Granted, the cost we will pay is more than cable providers per customer, but still cheaper in the long run since we are no longer paying a middle man of franchise fees, box rentals, etc. This goes into the pocket of the network directly, producing television and less commercials. Thus, the commercial for revenue model will fade.

    Also – it should be noted, that if the networks hated the Hopper so much as they claim, they would remove the time and signal codes in the broadcast signal that alert the devices like Hopper and DVR that the program is on break, beginning or ending, and a commercial comes on. It is much like a chapter search in a DVD, it signals to the device, there is a break. Networks control that. If they dont want us skipping commercials, they should take out those breaks in the time codes.

  3. Deborah McAdams Tuesday, February 12, 2013

    So why doesn’t it skip commercials on all networks, and not just those with which it negotiates retransmission consent?

Comments have been disabled for this post