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Dish defends ad-skipping DVR, pay TV peers throw it under bus

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If Dish Network was expecting an “I am Spartacus” level of peer support for its new ad-skipping DVR, it won’t find it at this week’s Cable Show. And aggrevated broadcasters shouldn’t be looking to hear an apology and retraction from Dish chief Charlie Ergen, either.

On Tuesday, Glenn Britt, chairman and CEO of the No. 4 pay TV service provider in the U.S., Time Warner Cable, became the first executive from the multi-channel industry to speak out about a controversial new feature in Dish’s Hopper digital video recorders. This feature filters out commercials from the recordings of broadcast-network shows.

“The dual stream of advertising and subscription fees has been great for content providers, and we don’t want to destroy one of those revenue streams,”Britt told a Cable Show audience, which included reporters from publications including Ad Age. “Subscription prices will go up or less content will be made.”

Also read: How broadcasters could have stopped Dish’s Hopper

Mark Greatrex, chief marketing officer for another top cable operator, Cox Communications, also weighed in: “As a marketer it’s not particularly helpful to bring that much uncertaintly into the marketplace.”

During upfront presentations to advertisers last week, virtually every broadcast network chief took verbal aim at the feature, with Fox and NBC even pledging not to let Dish run ads for it on their channels.

But speaking to Associated Press Tuesday, Vivek Khemka, Dish Network VP of product management for Dish, said they’ve got it all wrong.

By recording every minute broadcasted in prime time by ABC, CBS, Fox and NBC, the Hopper is actually enabling consumers to watch more television. “It’s a win-win for consumers and the networks,” he said.

Of course, it’s hard to see how the networks are “winning” when a key aspect of their monetization model has been stripped away.

The other part of that model is the relatively new revenue stream created by broadcast networks demanding retransmission fees from the cable, satellite and telco TV service providers who offer their signals to subscribers.

With Dish trying to grow its current subscriber count of around 14 million, offering consumer-friendly features that let users skip ads probably helps. But all DVRs provided by multi-channel operators feature some level of commercial-skipping ability (it’s simply called fast-forward).

Questions that remain unanswered:

By throwing a Molotov Cocktail directly at broadcasters, might Dish be looking for a negotiating hedge against the Big Four Networks to help control fast-rising retransmission costs? And if so, might Dish have expected a little support from its peers in the multi-channel business?

If the answer turns out to be “yes” to the latter, it sure hasn’t received that support yet.

8 Responses to “Dish defends ad-skipping DVR, pay TV peers throw it under bus”

  1. Carol56

    Very interesting. I’m to the point of not watching any TV at all because of the annoying and incessant advertising. Sorry for the people who are employed in the advertising industry, but we are sick and tired of commercials. I mute all of them, and as far as brand recognition goes, if I remember the product while shopping, I will NOT buy it. So how is that working for you???

  2. Harold Madison

    I don’t understand why CBS, FOX, & NBC execs don’t want us to enjoy commercial-free TV. I’m a DISH employee – AutoHop is great because you can easily watch commercial-free TV. Public Knowledge, a consumer advocacy group, is taking a stand for consumers by creating a petition that tells CBS, FOX, & NBC media to keep their hands out of your living room & DVR. Sign their petition to keep control of how you watch TV

  3. Ehnyah

    Me and my friends have a joke, we watch the commercials, to know what products not to buy. The truth is that we’ve been skipping those ads for years, consciously or not, and consumers are scratching their heads, “why am I paying for content that is paid for by advertising?”

    All dish is doing is giving customers, who pay for tv, what they already have in a more convenient way, after it’s aired live with commercials.

    By the way, did anyone catch that last episode of your favorite show where they were using an ipad while drinking pepsi and eating doritos…pay no attention to the additional revenue streams of product placement. ;)

  4. “The dual stream of advertising and subscription fees has been great for content providers, and we don’t want to destroy one of those revenue streams,” told a Cable Show audience, which included reporters from publications including Ad Age. “Subscription prices will go up or less content will be made.”

    I’m quite sure it has been “great” for you….but not for us poor bastards having to put up with overpriced subscriptions and over the top mostly useless ads.

    If anything, this type of ad skipping is a boon to the advertising industry in that you understand exactly how many people absolutely hate the crap you are advertising.

    There are no morals and ethics in your choice of advertising and that is why I avoid it like a dose of the plague.

    Here are the results of increasing sub costs: More piracy and less customers.

    Here are the results of less programming: Less eyeballs, decreased advertising revenue.

    The good news is this…you will listen to consumers or you will go out of business. What consumers are saying is less exposure to advertising is good and lower sub prices are necessary to keep their loyalty in a world where just finding enough money to pay for massively inflating essentials is becoming difficult for 50% of the population.

    So sorry your not going to be able to afford that second MCmansion,boat, and jet….the consumer could not care less.

    You people really do live in a world where everything revolves around you don’t you? Perfect examples of why powerful government and regulation needs to exist!

    • How do you propose that content be paid for? If not by advertising, if not by subscriber costs, then by who? I hate to break it to you, but in EVERY industry there are people making money hand-over-fist and they’re not about to take a pay cut to keep things status quo. There are also thousands of people – regular, ordinary people – employed in the entertainment and advertising industries. All you’re really saying is, “Screw those guys, I don’t care if they have jobs. I just want my TV free, plentiful, and commercial-free!” Well, guess what – it doesn’t work that way. And what exactly do you think government regulation is going to bring to the table? TV licenses (paid by the consumer, by the way) like in the UK?

      • William Hughes

        I gave up watching TV a little over five years ago because of excessive advertising and the contents of those ads. In the last 15 years the amount of commercials shown during a program has more than DOUBLED. In some cases over a third of a show is commercials. Heilager said “There are no morels or ethics in your choice of advertising” Many companies seem to think the best way to sell their product is to do so in the most obnoxious manner possible. Advertisers show NO regard as to WHO is in front of the TV when their commercials are played. During weekend Sports Events, one cannot go 15 minutes without seeing an ad for some sex pill or another “Adult Product”. Don’t you realize that CHILDREN ARE WATCHING?! Even Children’s Shows are not safe from these ads. I know Parents who FORBID their children from watching a Show until they first record it and edit out the commercials. Is it any wonder DVRs are so popular? As for me, I wait until a Show is available on Home Video before I watch it.