CBS Will Drop Dish If Auto Hop Stays
- by David Goetzl @dgoetzl, September 12, 2012
CBS CEO Leslie Moonves said the company will ultimately drop its flagship network from Dish Network unless the satellite operator discontinues its Auto Hop ad-skipping device.
CBS is in
litigation along with other networks trying to thwart the device, but even if that proves unsuccessful, CBS could simply decline to renew a carriage deal with Dish when the current contract runs
out.
Other networks could follow, putting Dish with its 14 million customers in a tough spot. Still, Dish has given no indication that it will pull Auto Hop, which is part of a Hopper
DVR service, from the market. Auto Hop allows for automatic commercial-zapping of prime-time fare.
Moonves said he doesn’t believe that Auto Hop will survive because of
marketplace dynamics.
“If they want to eliminate our commercials, we will not be in business with them -- it’s pure and simple,” he told investors Wednesday.
“We cannot produce an episode of a show for $3.5 million and have the people at Dish say: ‘We can pull out the commercials.’ That’s not how the ecosystem works. If they want to
continue down that line, then we will just not be on Dish. That’s what will happen. We will go elsewhere, and people will take our content.”
Similarly, he said CBS will
continue to fight Aereo, a device that offers CBS content on mobile devices in New York without compensating the network. CBS and other networks are also in litigation with Aereo, but that case
carries a different dynamic. If the networks lose, they can’t pull programming off Aereo, since it plucks it via over-the-air distribution.
Separately, Moonves suggested CBS
might consider getting into the cable business with a general entertainment network. Could CBS operate current cable assets better? “There’s no question about that,” he said.
CBS also said recently that it expects to pull in $1 billion annually via carriage fees from distributors. It recently made deals with Cablevision and AT&T and has avoided blackouts
during negotiations.
“The good news is we haven’t gone dark anywhere,” he said. “It’s not that we’re not tough negotiators … people are
realizing the value of our content.”
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OK, CBS is upset subscribers have a way to skip commercials. They (and ALL the networks and stations) need to ask themselves this question:
WHY do viewers use these devices to avoid commercials?
The answer is simple.
Two Reasons:
1. The amount of advertising during a show.
20 years ago a viewer could expect to see 10 to 12 minutes of commercials for every hour of programming. Today those figures have more than DOUBLED. A program can run for six minutes, then the commercial break lasts five minutes. People lose interest in what they are watching, or even forget what they were watching. Do we really need to see the same ad for a product up to 10 times each hour? For example, A certain Insurance Company, I hate to say this, but there are TWO people on this planet who haven't seen your Lizard , caveman, stack of money, ect, and even if they DID see them, they don't have anything your Insurance would cover.
2. What's on these commercials.
WHY, in the name of Heaven, do advertisers seem the best way to get you to purchase your product is to present that product in the most obnoxious manner possible.
People do not like being insulted, and will most likely skip the and/or NOT purchase your product. Also, some advertisers have absolutely NO REGARD as to WHO is watching their ads. Commercials for "Adult Products" such as "ED Pills", Woman's Personal Products and the like are shown Morning, Noon and Night. During a Weekend Sporting Event, one cannot go 15 minutes without seeing these kinds of commercials, never mind that CHILDREN ARE WATCHING. Even the shows the kids watch aren't safe from
these kinds of commercials! Parents use DVRs and other devices to record a program for their kids, and edit out any ad they don't want their children to see.
Want people to see your ads?
Reduce the amount, and CLEAN UP YOUR ACT!
I simply cannot agree with the comment above comment! The industry's incessant greed is causing consumers to make choices for themselves - choices we are free to make.
On the other hand, there are no longer a handful of TV channels in a market. Mow, with hundreds (via cable), the slice of the revenue pie has shrunken, and I suppose the networks are desperately trying to make up for the shortfall - with zero regard for awful programming and demeaning advertising.
"… people are realizing the value of our content.”
Right, which is why I haven't watched a CBS show in well over 2 years.
Jay you are absolutely correct. It makes no sense why consumers would have to pay for programming and then be forced to watch commercials also, other than greed. Now that I use the Auto Hop to trade boring commercials for more homework time, my grades have improved. If CBS has a problem with that then they can go ahead and take their channel back. One of my supervisors at Dish mentioned that they are already broadcasting their channel to millions of people for free already. I hooked my TV to an antenna to check and it’s true.
Should have said, "I simply cannot agree more with the comment above comment!" by Mr. Hughes. Sorry!
By the way, has anyone noticed the quality of network shows declining, as the networks' greed inclines?
Even the venerable "60 Minutes" relies now on like 6 journalists instead of 4, and the stories are ho-hum.