DVRs Might Prompt Networks To Sell Ads In Programs

by , Dec 11, 2012, 11:24 AM
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In New York, Cablevision has been running an overlay on-screen as drama “Chicago Fire” airs on the local NBC station. It’s a relatively large static banner that pops up within the programming, carrying the cable operator’s Optimum brand and the station logo.

(It’s a convenient way for Cablevision to gain exposure in homes served by DirecTV and other competitors. The ads may appear in other shows or for other advertisers on WNBC.)

The Big Four networks have become increasingly intrusive (and creative) with the promotions for their coming shows that appear as the programming airs. No longer are there just static banners on the bottom of the screen, but all kinds of moving graphics and images. The promotions were known as “lower thirds,” but more of the screen seems to be open for play.

Still, for the most part, that valuable real estate has been blissfully kept off limits to advertisers. But with DVR use growing, how long will it be before networks put it up for sale as WNBC apparently is doing -- at least in small part -- in New York?

It’s an obvious balancing act between cashing in and avoiding consumer backlash. But, the cash may be too hard to turn down since the space is DVR-proof.

The networks have actually put themselves in a good position to put out a for-sale sign. All of the distracting stuff they’ve been doing to plug their own stuff as a “Grey’s Anatomy” or “Big Bang Theory” unspools likely makes it so viewers would be less turned off than a few years back.

They’ve become used to the promotions, so how different would images backing McDonald’s be?

And, if the promotions are done appealingly – and kept brief -- frustration might be minimal. LeBron James popping up and quickly swallowing a few fries could be funny. And, there is no sound. (The promotions may be more palatable to viewers than product placement because viewers may appreciate that there is no veiled tactic .)

Turning the screen into something resembling a NASCAR vehicle would of course be a problem, but a banner or motion graphics every half hour might be an acceptable amount to a viewer. Of course, once new ad space is made available, it's hard to put the genie back in the bottle and a slippery slope might emerge as far as what else within a show could be for sale.

Even if networks opt to keep the in-show space ad-free, DVRs are making the need for them to keep innovating with their "lower-third" stunts increasingly intense as their traditional 30-second promos are being skipped, along with ads for Fords and smartphones.

In court papers filed by ABC in its effort to get a preliminary injunction against Dish Network for its AutoHop service, a network executive goes into some detail about how AutoHop is a threat to its promotional efforts.

The controversial service records some prime-time programming and automatically removes all ads, including the ones promoting a network’s shows. “The largest advertiser on ABC is ABC itself,” says Patrick McGovern, an ABC senior vice president, in a Dec. 7 filing. “ABC uses large blocks of its valuable commercial time to promote its own programming … forgoing millions of dollars in potential advertising revenue every week.”

And, McGovern says on-air promotions are increasingly critical to let people know about new programming as less TV is watched live. Harkening back to yesteryear when live TV was the norm, he says: “With more viewing occurring on a time-shifted basis, ABC can no longer count on viewers who watch 'Who’s The Boss' at 8 p.m. learning about ‘Growing Pains’ at 8:30 p.m., by simply keeping their televisions tuned to ABC.”

Commenting more directly on AutoHop zapping all commercials, McGovern says at least with DVR fast-forwarding, viewers may still be exposed to the ABC logo, program name and date and time it airs.

Certainly, a shutdown of AutoHop would be a plus for the Big Four networks’ promotional efforts, but if the service survives, it may get them thinking more about breaking ground in selling ad space inside content.

3 comments on "DVRs Might Prompt Networks To Sell Ads In Programs ".

  1. Doug Garnett from Atomic Direct
    commented on: December 11, 2012 at 11:54 a.m.
    What's too bad is that the networks may destroy the only value they have to draw consumers (good programming) by reacting to a myth...because research shows DVRs don't destroy TV advertising. Since the expansion of DVRs, TV ad effectiveness (it's impact creating a market action) has IMPROVED. Unfortunately, within the ad agency echo chamber, creative and media teams seem to let their self-loathing loose and ignore this reality - preferring instead to bad mouth their most effective medium. I don't get why it's so popular. But it's also not unusual to watch businesses destroy themselves based on mythology.
  2. Douglas Ferguson from College of Charleston
    commented on: December 11, 2012 at 1:44 p.m.
    Snipes are annoying enough for promos (which ARE advertising, after all), but I don't think people will sit still for product ads. I suppose I can scotch-tape a piece of cardboard across the bottom of the screen to thwart uninvited, intrusive ads. Better yet, just obtain the shows direct from the producers (BitTorrent, anyone?) -- or pay-per-view.
  3. Frank Mudd from N/A
    commented on: December 11, 2012 at 6:47 p.m.
    Hey networks, why don't you address the reason that DVRs exist to begin with? Year after year, you kept increasing the commercial load. No one wants to sit through 18 minutes of commercials an hour. If you keep intruding on the "lower third", you will turn more viewers off. Sure, some may wait patiently for the unmarred DVD to watch, but most wont. If you keep making it a nuisance to watch TV, you'll start turning more people into readers. Now who wants that?!? Dish's Hopper isn't illegal. But the time to negotiate it away is at contract renewal time, and that has to be done through the broken affiliate business model. As far as commercials promoting other programs on the same network, it is pointless to argue their consumption on a DVR. If I watch "Happy Endings" and there is a promo for a great guest on "Jimmy Kimmel Live", there is a very small window of time for that promo to be acted upon. Chances are, the show already happened. If you want to alert DVR viewers of other shows, you should do it via their recommendation engine. Negotiate that with the satellite/cable companies.

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