Time Warner Cable CEO Says No To Ad Skipping Technology

  • by May 12, 2002
AOL Time Warner will not include a so-called "ad-skip" button in new set top boxes that include Personal Video Recorder (PVR) capability, according to Time Warner Cable CEO Glenn Britt. Time Warner will be testing such set-tops, manufactured by Scientific Atlanta, in Rochester, N.Y., later this year.

Britt made his comments during an interview with Cable World editor at large Staci D. Kramer on the floor of the National Cable and Telecommunications Association annual convention in New Orleans last week. He also told Cable World that the nation's No. 2 cable operator is seriously considering copyright protection and other possible content issues as it works on the design and implementation of set-top boxes. He said he wants to avoid "crossing the line," which means the MSO's set-tops will not make it easy for consumers to manipulate content in ways that would breach copyright.

Advertisers and their agencies have been increasingly concerned about new PVR technology that allows a viewer to skip advertising with a click of a button as opposed to running through ads on fast-forward, which has been a common practice since the advent of the VCR. Ad skipping technology, they contend, threatens the entire economic model upon which television is based.

In an interview with Cable World in its April 29 edition, Turner Broadcasting Chairman and CEO Jamie Kellner, whose company is owned by AOL Time Warner, took direct aim at devices that allow viewers to strip advertising content from programming in real time, going so far as to suggest that doing so amounted to breach of contract on the part of a viewer. He told fellow programmers at the show they were "crazy" if they weren't looking at ways to deal with the issue.

Not all programmer concerns have to do with ad-skipping technology. Walt Disney President and COO Robert Iger raised the possibility of an increased likelihood of commercial skipping in video-on-demand content. "I'm not suggesting that everyone uses the remote control to scan through commercials, but we all know that we've raised a generation of kids that don't watch television without a remote control in their hands. I think it's less likely that commercials will be viewed in that form than they're currently viewed on live television."

Other operators are listening to programmer concerns about the way new set-tops might affect their business models.

"I think we're more sensitive today than we were six months ago," said Cox Communications VP-operations Pat Esser. "We respect the needs of networks. We're going to have to work in some constraints to protect that business for them. If we don't, that model could collapse."

The most recent edition of the PVR Monitor by Memphis-based NextResearch suggests Kellner and company may be right to worry. The survey of 358 households with at least one PVR showed that one in four PVR users always fast-forward through commercials while just one in 10 says they never fast forward; just over half said they fast forward sometimes. Those who do watch are more likely to stick around when the commercial is entertaining.

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