http://www.variety.com/article/VR1118060500?refCatId=14
Straight talk for DVR-happy viewers
Audiences have to accept paying for TV with their time or money
By Brian Lowry
The ratings for young-skewing shows like “Revolution” go up when
delayed viewing is figured in, but DVRs’ ad-skipping capabilities
still threaten TV’s business model.
In the case of the political class, the elephant in the room involves
a blunt conversation about taxes -- which most people don't relish
paying -- as a tradeoff for providing government services they're
accustomed to receiving and do like.
For TV, it's the question of advertising, and whether the traditional
system can survive if consumers continue to indulge their
technology-given right to circumvent ads whenever possible.
The second heart-to-heart talk boils down to a simple query for TV
viewers: "If you like these shows, what are you willing to give up to
keep them viable: Time or money?"
One of the most interesting wrinkles in analyzing the new fall TV
season has been the boost networks are seeing thanks to DVR viewing.
Ratings increase more than 20% for many shows (the percentages
sometimes appear inflated because the base was so low) once three-day
averages are included. The DVR bump is more pronounced than it was a
year ago, reflecting higher penetration of the devices and more usage.
Moreover, live-plus-three-day gains are generally higher
percentage-wise among key demographics -- those most important to
advertisers. This seems logical, since younger adults are presumably
more fluent in time-shifting strategies than, say, their grandparents,
who tend to watch more.
That people are still finding and sampling new shows is, of course,
welcome news for broadcasters. Yet while networks fought hard to win
concessions from media buyers about counting time-shifted viewing when
selling spots, the growth in DVR-mediated consumption doesn't bode
well for an ad-supported model, given how easy it is -- even without
something like Dish's ad-skipping Auto Hop function, which triggered
outrage among broadcasters -- to zap past commercials.
Yes, networks can point to counterintuitive research that shows
viewers still see a surprising number of ads, even when watching on a
delayed basis. According to this argument, ordinary people are less
zap-happy than media-saturated critics, yielding headlines like "Do
Americans Watch More DVR'd Commercials Than You Think?"
Even if true, this argument is somewhat self-defeating. If your
audience is too inert, ignorant or indifferent to realize they can
watch an episode of "The Good Wife" in roughly 43 minutes by excising
all the clutter, it's questionable whether they're a particularly
desirable bunch at which to target upscale products in the first
place.
Anecdotally, on Sunday night I efficiently sped through ABC's trio of
scripted one-hour dramas in about 140 minutes. In the course of that
span I saw innumerable bumper promos for "Nashville" -- hard to miss
or avoid those -- and one spot for DreamWorks' upcoming movie "Rise of
the Guardians." That's it.
The Obama campaign has spoken of "economic patriotism," trying to
persuade voters (particularly those in upper-income brackets) to
accept anteing up, tax-wise. Networks may need to embrace a similar
strategy -- advocating "programming pragmatism," perhaps -- to
reinforce the idea that TV fans can't expect a completely free ride.
Just as the government needs tax revenues to function, those who want
"free" TV programs must pay the freight too, either by shelling out
cash directly -- as they do for Showtime or HBO -- or enduring
commercials. And while networks remain understandably fretful about
"unintended consequences to messing with the TV ecosystem," as the Los
Angeles Times recently put it, it's only a question of what form the
messing will take.
The newspaper industry clearly suffered for being slow about prodding
customers to understand the shifting realities assailing its business
model. While TV is better situated to cash in on digital and on-demand
technology, migrating consumption to the digital realm is fraught with
peril as well, and efforts to thwart ad-skipping methods in that space
will almost certainly face their own challenges.
As noted, Hollywood and Washington have been in lockstep when it comes
to balking at initiating these uncomfortable conversations; instead,
the tendency is to delay, hoping the bill finally comes due on some
other poor slob's watch.
Think of it as another form of delaying -- in this case, maybe the
inevitable.