Dish Should Put Itself At Risk Of Auto-Hopping
Dish Network should move to show its controversial ad-zapper places it at similar risk to the major networks. Otherwise, it’s open to well-founded charges of hypocrisy, while giving opponents plenty of grist in court.
Dish has ABC, CBS, Fox and NBC apoplectic with its new AutoHop DVR feature, which allows users to automatically skip all commercials in recorded prime-time shows from them. Why only the Big Four?
Dish, which has about 14 million subscribers, says it’s because the bulk of recorded shows come from their prime-time line-ups. In May, a Dish executive said there is no technological impediment to enabling AutoHop for cable networks, but the satellite operator has no plans to go that route.
It’s making a mistake and can rightly be accused of hiding behind a smoke screen.
The networks, which are challenging the legitimacy of AutoHop via federal lawsuits, charge AutoHop will cost them dearly in ad revenues. On a discrete level, that doesn’t concern Dish. The satellite operator has no ad inventory to sell on the Big Four networks. So, why not let people zap the ads there in the name of better customer service?
Dish maintains that AutoHop simply improves the user experience, allowing people to more easily do what existing – and legal – DVR technology already does. It’s a sound argument that should make for fascinating debate in court.
But Dish is having its cake and eating it, too. It should starve itself to avoid appearing – and acting – duplicitous. The satellite operator should subject advertising it sells to auto-hopping, putting its own ad dollars on the line. That would score points on the PR front and, maybe more importantly, help blunt questions it is sure to face in court from lawyers representing the networks.
Unlike broadcast shows, Dish derives ad dollars from inventory it owns across 70-plus cable networks, where increasingly popular programming ranges from TNT’s “Dallas” to MTV’s “Jersey Shore” to Comedy Central’s “Daily Show."
Yes, Big Four shows as a group might account for most time-shifted viewing, but these and plenty of other cable hits have people teeing up the DVR. And, if AutoHop is so appealing, Dish customers would certainly embrace the chance to skip all the ads -- including those bringing dollars to Dish.
Dish gets about two to three minutes an hour to sell on cable networks. In its media kit, it touts all kinds of advertiser benefits from interactive advertising to demographic targeting. Dish also uses much of its ad time to promote its own services, where it looks to upsell viewers on new products such as the Hopper, the DVR that facilitates AutoHop.
Obviously, the ad revenue Dish collects pales beside a major network, but it's substantial. Perhaps never more so than this fall when a rush of political dollars are set to come its way it would not want to sacrifice.
Several years ago, Dish might have been afraid to enable auto-hopping for cable shows since that could have complicated carriage negotiations with cable networks. But, now the Big Four broadcasters are charging Dish the same type of cash. So, there isn’t much difference in subjecting broadcast and cable programming to the AutoHop.
Except in how it impacts Dish's ad revenue.