An executive impacting much of the discussion this upfront week isn’t part of a network’s business operations in New York or creative side in Hollywood. He’s steeped in technology and works in flyover country.
It’s safe to say not many in ad sales know his name. But, they know his product quite well now.
Vivek Khemka, vice president of product management, has overseen the launch of Auto Hop at Dish Network -- a DVR function allowing full commercial wipeout for prime-time shows on ABC, CBS, Fox and NBC with the press of a button. Network executives are up in arms, one in particular.
NBC Broadcasting Chairman Ted Harbert called it “an attack on our ecosystem” (Sunday) and “an insult” to both advertisers and networks (Monday). Fox’s Peter Rice and ABC’s Paul Lee have offered more muted condemnation.
Auto Hop, which was announced last week, could lead to some legal challenges, but court resolution could take a long time. Swifter action could come via carriage negotiations between satellite operator Dish and the owners of local broadcast stations. Loads of those stations are owned by piqued Big Four networks.
Khemka, an electrical engineer with an MBA, is diplomatic. He deftly argues Dish is simply trying to help consumers and in the process is a friend of broadcasters. He’s careful not to fan the flames, but clearly the controversy brewing in New York was not expected.
“I do think promoting consumer choice is a great thing and when I saw some comments that were not very positive to the consumer that caught me a little by surprise,” he said.
When pressed about Harbert’s comments directly, he allowed: “My perspective is it’s an insult to not promote consumer choice.”
Khemka has been observing the negative Auto Hop coverage from the Denver area, where Dish is based. The satellite operator has more than 14 million customers.
Customers with the least expensive package won’t be eligible to use Auto Hop. The remainder will at a price of $10 a month (some will have to pay a $99 fee to start).
Khemka joined Dish in 2009 and reports directly to CEO Joe Clayton. He’s been a consultant at McKinsey and launched a team in mobile Internet and social networking at Motorola Mobile Devices.
He’s engaging, self-deprecating and witty. “I’m a product guy and if I can make a product that appeals to consumers, that makes me happy,” he said. “I’m not looking for fame or fortune.” Though, he hastens to add fortune would be nice.
Auto Hop is an outgrowth of the Hopper, a new DVR launched in mid-March that offers viewing in up to four rooms. By itself, it seemed evolutionary, but hardly controversial. Then, last week came the announcement about Auto Hop, which prompted NBC to go on the offensive.
While Khemka is largely circumspect, Dish ran a full-page ad in newspapers Monday, encouraging a customer to “Skip Commercials Automatically.” It’s also set up an #AdFreeTV hashtag on Twitter.
Khemka declines to say whether Dish had any discussions with the networks before debuting Auto Hop, but says they’ll benefit from it. Auto Hop could encourage more network TV viewership. And, if viewers discover new shows while using it, they may begin watching them “live” or via the Hopper on the same day they air.
The patented Auto Hop only starts working for an episode starting at 1 a.m. the day after broadcast – a function Khemka says was set up to be “sensitive to the broadcasters.”
Networks frequently talk about how consumer-friendly they are by making episodes available on-demand and via multiple platforms. Khemka says Dish is reacting to changing consumer behavior, too.
“People are already fast-forwarding shows with DVR programming,” he said. “Auto Hop makes it easier.”
While looking to skip commercials during a one-hour show, Dish has found consumers hit the 30-second fast-forward button about 32 times. Auto Hop simply reduces the button-pressing to once.
Auto Hop also is not a passive technology. It requires a consumer to effectively opt-in. First, a user must seek a show via Dish’s PrimeTime Anytime library and then activate Auto Hop for each episode view.
Khemka says Dish enabled Auto Hop for Big Four programming to start because it found the majority of shows viewed with DVRs were from those networks. There is nothing technologically that prevents it from teeing up the function for cable shows, though he said there are no plans to do so.
What bears watching is if broadcasters will use bargaining on carriage rights (known as restransmission consent) as an anti-Auto Hop vehicle. A broadcast station group could make disablement of Auto Hop a point in negotiations with Dish. It would be similar to networks only agreeing to put content on operators’ video-on-demand platforms if the fast-forward option is unavailable.
A widespread uprising would be gradual as many broadcast groups already have long-term deals in place with Dish, which likely can’t be reopened. But, there are hundreds of TV stations and agreements are expiring all the time. And, unlike a plodding court system, a station threatening an imminent blackout could get quicker action.
Networks could nudge their affiliate groups to hold the line, looking to establish a precedent and slow momentum, though there may be some legal issues. If Dish finds it has so many Auto Hop users that pulling back would be a mistake, stations could command higher payments.
A spokeswoman for the ABC-owned stations wrote in an email the company is “looking at the technology and then we’ll decide our next steps.” CBS, Fox and NBC did not provide immediate comment. Dish’s Khemka said the matter is a “hypothetical” one he couldn’t address.
Meanwhile, Dish will continue to promote Auto Hop aggressively and Khemka will be called on to speak about it again. Probably many times.