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DVRs altering HD viewing and programming...

post #1 of 73
Thread Starter 

I find some of these stats rather interesting...

 

Among viewers ages 18 to 49, the comedy jumped 48% when factoring in delayed viewing, while Idol's performance show gained just 17%.

 

Nielsen says 44% of homes now have DVRs, and though the adoption rate has slowed recently, those who have the devices are using them more often. Just 47% of viewing by young-adult DVR users was live, down from 61% four years earlier.

 

http://www.usatoday.com/life/television/news/story/2012-06-11/DVR-effect-on-2011-12-Nielsens/55534654/1

 

At what point do the networks give up on live viewing of non-live events such as scripted series? How about the sponsors and their commercials. And the article states channel surfing is going to come to an end...

 

What's suffering at the hands of the DVR is old-fashioned channel surfing, in which viewers might stumble upon an obscure show or a smaller cable network. If the first option is appointment viewing, "option No. 2 is what I have on my DVR," says Sam Armando of Chicago ad firm SMGx. Networks that depend on chance discovery "are starting to suffer a bit."

 

For me DVRs are going to reshape network TV long before the Internet.. Since reality shows, news, award shows and sports are more often watched live and as such it's more likely their commercials will be viewed I can see their emphasis going forward. Ratings are virtually irrelevant without the commercials being viewed.... more of the above to come! Perhaps the other stuff disappears or becomes subscription based before long...

post #2 of 73
jeez, they are just starting to figure this out. i have been watching dvr ed programming about 90% of the time since i got my first one in 2003.

now i can time manage my viewing and live my life as i want, not dependent on a tv schedule.

this is true for sports as well. dvr allows me to skip all the commercials and talking heads and just watch the game.
post #3 of 73
Thread Starter 
Quote:
Originally Posted by mr. wally View Post

now i can time manage my viewing and live my life as i want, not dependent on a tv schedule.

 

I figure if you average 4 hours of TV a day (including weekends)...

 

437 hrs = 4 x 7 x 52 x .30 (percent of commercials)

 

5,244 hrs = 437 x 12 (number of years I have used a DVR)

 

Number of hours one didn't waste watching commercials priceless. :)

post #4 of 73
Quote:
Originally Posted by mr. wally View Post

this is true for sports as well. dvr allows me to skip all the commercials and talking heads and just watch the game.

+1
I'll start watching a football game about halftime. That 30-second skip works great for NFL games. Tackle...skip ahead 30 seconds...next play.
post #5 of 73
This subject was brought up during Super Bowl week.

I record every Duke BB game and watch it later. I never watch golf during the day, only at night. The Redskins are the only pro football game that is a live event for me.

I only watch live TV when I’m surfing. Everything else is recorded.
post #6 of 73
The only thing I watch live is sports. Scripted shows I watch go on the DVR to watch on my schedule. Getting a DVR definitely changes your viewing habits that is for sure.
post #7 of 73
Thread Starter 

What I find interesting is how are the networks going to alter their programming because of the shift in viewing. I guess to some degree they already have but going forward a lot has to change as the current model won't support the changing viewing habits.

 

I'd like to see scripted shows (virtually everything not aired live) go to a subscription basis. Instead of airing weekly you purchase the season and stream episodes whenever you want. Perhaps releasing half a season at a time. I'd be more than willing to pay (a modest fee) to have access to say The Good Wife long before it hits Blu-ray. I know Amazon offers the latest season for streaming at $45 (HD). I wonder what they would have to charge if it didn't air on Network TV (losing the commercial revenues) and if they had an online audience of millions versus today's (a few thousand?).

post #8 of 73
Quote:
Originally Posted by Charles R View Post

What I find interesting is how are the networks going to alter their programming because of the shift in viewing. I guess to some degree they already have but going forward a lot has to change as the current model won't support the changing viewing habits.

I'd like to see scripted shows (virtually everything not aired live) go to a subscription basis. Instead of airing weekly you purchase the season and stream episodes whenever you want. Perhaps releasing half a season at a time. I'd be more than willing to pay (a modest fee) to have access to say The Good Wife long before it hits Blu-ray. I know Amazon offers the latest season for streaming at $45 (HD). I wonder what they would have to charge if it didn't air on Network TV (losing the commercial revenues) and if they had an online audience of millions versus today's (a few thousand?).
It really depends on whether a network is getting carriage fees per subscriber and how much those are. If they're available in 120 million homes and getting $.50 a sub (plus ad break dollars), there's little chance a subscription model could generate enough revenue to cover that without the customer paying more than they want to for the content.

Most shows today are pretty luck if they get 15 million viewers. To get the same revenue above (assuming they keep all 15 million viewers under the subscription model), it would mean subscribers paying roughly $10 an episode when taking into account the ads that would normally appear in the show.

However, it's not that simple. That $.50 a sub is per month, for the entire network. That means, the more shows a viewer watches, the less each show earns per viewer. Higher rated shows get more ad dollars, but those subscriber fees for a network are flat.

So, let's assume the average viewer watches 4 shows with an average audience of 15 million each x 4 episodes a month (during the season for each show). If each of those shows actually gets 15 million subscribers per epsiode, you're looking at a fee of around $.60 per episode.

Obviously, you won't get the same number of subscribers as you would viewers who can just tune in without thinking about the cost of a cable subscription, though. We all have seen shows that go from broadcast to cable that see a great reduction in viewers (Southland, MNF, etc) but survive because of additional outside revenue. The same would go for liner verses nonlinear viewing. One could assume that if viewership from braodcast to cable can drop in half, that it would likely be 1/4 for a subscription service based on numbers of people that both watch shows on Hulu and pay for a Hulu+ subscription.

That means, we'd be taking anywhere from $1.50 to $2 an episode to generate the same revenue. That lines up with what Amazon.com is charging.

That doesn't sound like a lot until you count every show you really must see. If you watch 10 series at $2 an episode, that's $80 a month ($2 x 10 shows x 4 weeks a month). When you look at it that way, you may as well subscribe to cable or satellite and have access to everything. Even if you don't watch the majority of it, there are likely shows you watch because it doesn't cost anything extra now, but would give up under a subscription plan.

Now, we can assume there would probably be maybe a 10% or so discount by subbing to a whole season, but that's still a lot of money - and it's money the content creators will want to continue to get if they are going to continue to make the content.
post #9 of 73
Thread Starter 
Quote:
Originally Posted by NetworkTV View Post


It really depends on whether a network is getting carriage fees per subscriber and how much those are. If they're available in 120 million homes and getting $.50 a sub (plus ad break dollars), there's little chance a subscription model could generate enough revenue to cover that without the customer paying more than they want to for the content.

That means, we'd be taking anywhere from $1.50 to $2 an episode to generate the same revenue. That lines up with what Amazon.com is charging.

That doesn't sound like a lot until you count every show you really must see. If you watch 10 series at $2 an episode, that's $80 a month ($2 x 10 shows x 4 weeks a month). When you look at it that way, you may as well subscribe to cable or satellite and have access to everything. Even if you don't watch the majority of it, there are likely shows you watch because it doesn't cost anything extra now, but would give up under a subscription plan.

 

The example I used was an OTA network show. Although the local affiliates do get some cable/satellite fees which I'm guessing isn't all that much. And if DVR usage continues to grow (I see no reason why it shouldn't) the commercial model is going to get blown away. Its income is going to all but disappear for a lot of existing content. So it can either disappear as we now know it or its revenues will have to be replaced. There is only so much product placement and sponsorship can do and I don't think it can come close to make up the lost revenue.

 

So what do the the major networks schedule when only reality show, live events and such can sell commercial spots. Drop scripted shows completely? I can see the major networks re-inventing themselves not because of the Internet rather the DVR will force their hand. 

post #10 of 73
Quote:
Originally Posted by Charles R View Post

The example I used was an OTA network show. Although the local affiliates do get some cable/satellite fees which I'm guessing isn't all that much. And if DVR usage continues to grow (I see no reason why it shouldn't) the commercial model is going to get blown away. Its income is going to all but disappear for a lot of existing content. So it can either disappear as we now know it or its revenues will have to be replaced. There is only so much product placement and sponsorship can do and I don't think it can come close to make up the lost revenue.

So what do the the major networks schedule when only reality show, live events and such can sell commercial spots. Drop scripted shows completely? I can see the major networks re-inventing themselves not because of the Internet rather the DVR will force their hand. 
I've heard numbers on compensation anywhere from $.25 a viewer to some stations wanting as much as $1 per. Whether they actually get anything close to the $1, I can't verify. Unlike with cable channels, there doesn't appear to be a broadcast channel compensation list out there. Local TV channels tend to like the idea that you have to trudge up to the station to view the public file.

At any rate....

I don't think the DVR is the threat to commercial television everyone seems to think it is.

Before DVRs, we had VCRs. Before VCRs, we had remote controls to flip to another channel. Before remote controls, we had a fridge, a bathroom and other reasons to leave the room during the break. When I was a kid, we tended to turn the TV off and do something else if we didn't see anything we wanted to watch.

Sure, there are those who are simply opposed to any sort of advertising at all and will avoid it if at all possible. There are similar groups of people who refuse to pay for content, drive without insurance or a license or will eat their way through the supermarket produce section. Not everyone is a potential paying customer.

However, most DVRs still rely on you to fast forward past commercials, meaning you still see them in some form. Others let you jump ahead in 30 second increments. Dish wants to skip them entirely, but I think they underestimate what will happen to their programming contracts as a result.

Personally, having a DVR that jumps forward in 30 second blocks (actually 27 seconds), I actually sometimes jump back to look at something that catches my eye when my brain goes "what was that?" during the second or so snippet I see. Certain really clever ads would get me to watch them when they would pop up (the Mac vs. PC ads being one example). Sometimes, when I'm doing something else while watching a show, I'll just let the program roll, commercials and all. I'm sure I'm not alone.

The networks really don't need to change their business model right now so much as change the content style:

1 - Advertisers need to come up with better commercials that get attention. Commercials like the Volkswagen Darth Vader spot not only got a lot of views on TV, but was huge online. Perhaps taking a cue from the GoDaddy model where the ad drives traffic to the online product would be a better approach.

2 - TV shows need to mix up the pods more. Right now, when a commercial break comes on, you've got a few minutes to do whatever, even if you don't have a DVR. Randomizing the break lengths and the times within the hour they occur would help keep people planted in their seats. Law and Order used to mix up whether they went back to the show or to a break following the opening credits. That unpredictability of when the show will be back keeps people guessing and less likely to wander.

3 - Make the commercial breaks shorter. Right now, networks take the "more is better" approach by selling more ads for less money. The networks complain that advertisers are spending less and need to sell more ads to compensate, but fail to do the one thing that can change that: make content compelling enough to make it worth the advertiser paying more. The fact is, the more commercials stations pack into breaks, the more people are going to want to watch the show through alternate means that have fewer of them.

4 - Offer more engagement for viewers who want it. "Lost" was a great example early on of a show that had a lot of social networking potential. Shows need to get back to being "water cooler" entertainment by giving something for people to talk about. Generic procedurals aren't going to do that.
post #11 of 73
Thread Starter 
Quote:
Originally Posted by NetworkTV View Post

Before DVRs, we had VCRs. Before VCRs, we had remote controls to flip to another channel. Before remote controls, we had a fridge, a bathroom and other reasons to leave the room during the break.

 

I disagree as VCR viewing never had the penetration of current DVR viewing not to mention its ongoing growth. Plus, the convenience factor of using a DVR and skipping commercials.

 

They can do whatever they want but viewers aren't going to view their ads. Pretty much the only time they will get shown is if someone is passively watching TV and at that point they aren't going to see them anyway. :) According to the article roughly 50% of viewing by the desired demographics is done via DVR. Do you really think these kids are watching commercials?

 

I'm not saying no one will be watching commercials however the numbers are dropping like crazy especially for viewers they wish to attract. At some point the advertisers will say enough is enough... it's not worth the cost. The networks better plan ahead as no matter how they or the advertisers try to reinvent commercials they are on the clock.  

post #12 of 73
Quote:
Originally Posted by Charles R View Post

I disagree as VCR viewing never had the penetration of current DVR viewing not to mention its ongoing growth. Plus, the convenience factor of using a DVR and skipping commercials.

They can do whatever they want but viewers aren't going to view their ads. Pretty much the only time they will get shown is if someone is passively watching TV and at that point they aren't going to see them anyway. smile.gif According to the article roughly 50% of viewing by the desired demographics is done via DVR. Do you really think these kids are watching commercials?

I'm not saying no one will be watching commercials however the numbers are dropping like crazy especially for viewers they wish to attract. At some point the advertisers will say enough is enough... it's not worth the cost. The networks better plan ahead as no matter how they or the advertisers try to reinvent commercials they are on the clock.  
The problem is, the commercial skipping and streaming crowds aren't the ones being measured in the ratings.

The ones that plank themselves in front of the TV, watch things as they air then write it all down in a paper diary are.

Right now, DVR ratings still are left to saving bubble shows and giving the occasional opportunity for a network to tell advertisers, "look, we actually beat 'Idol' 2 days later!"....

The fact is, the whole Janet Jackson half time show thing proved that DVRs can not only measure the audience for the show, but what they jumped back to watch again. That could apply to what ads are being watched or skipped.

While networks might be nervous about such data at first, I think it could be helpful data for targeting the proper viewing audience that will watch the ad - then log onto YouTube to watch it again.

Right now, advertisers buy a time slot and a demographic. They don't buy potential customers. If they get smarter about that and target their ads correctly, they'll be worth more with less on screen time.
post #13 of 73
Thread Starter 
Quote:
Originally Posted by NetworkTV View Post


The problem is, the commercial skipping and streaming crowds aren't the ones being measured in the ratings.

 

Not true at all per the article I linked to previously...

 

In final season rankings out Monday (Nielsen's time-shifted rankings are delayed by about two weeks),Family, already one of TV's top shows, added an average of nearly 5 million viewers in the seven days after new Wednesday episodes aired against Idol. That's the biggest gain for any series, for a total of 16.7 million viewers.

 

They are being counted more and more everyday. With roughly 1/3 of the total rating for the show referenced. One would be beyond naive not to take into account 1/3 of your viewers will be via DVR if you are buying ad space for the show...

 

With few exceptions they can do whatever they want with their ads and it doesn't matter one bit as they aren't going to be watched in the first place.

 

The audience for Fox's Friday sci-fi dramaFringe, for example, surged 55% (and a stunning 73% among young adults) once viewing up to six days later was factored in.

 

Another example of DVR viewers being counted... not too far from matching the live audience numbers for key demographics.

post #14 of 73
Thread Starter 
Quote:
Originally Posted by NetworkTV View Post

While networks might be nervous about such data at first, I think it could be helpful data for targeting the proper viewing audience that will watch the ad - then log onto YouTube to watch it again.

 

This is somewhat related and I agree DVR tracking has a lot of value. I'm opted in with TiVo and I hope they make tons of money selling my viewing habits. This information could help or hinder the networks. What will the ad buyers think when they find out I (virtually) haven't watched an ad in over a decade? Of course target marketing can help but I see it more as an add-on service not within the show (and skipped).

 

Let's say after watching Fringe your TiVo pops up a screen with related content... purchase the Blu-rays, order the latest greatest science fiction novel, etc. Right now every time I pause a show TiVo wants to send me a Bounty coupon... not targeted nor have I taken advantage of it. Lots of opportunities down the road I just don't see typical ads being one of them.

post #15 of 73
I watch just about everything on DVR delay now. I especially enjoy watching sports on the DVR because I have found that I can watch a two and a half hour NBA game in about one and a half hours by cutting the before game, after game, halftime chatter and the commercials. I think I actually "see" more television because of the DVR because if I am channel surfing and come across something that I would not have normally watched, I now can DVR it and at least sample view it at my convenience.
post #16 of 73
In football a 30 second skip at the end of play will usually get you to the beginning of the next play.
post #17 of 73
Baseball and football were made for DVR viewing. A 10-second skip is perfect to see every pitch of a baseball game, while the 30-second skip is perfect for the NFL. Basketball is much tougher to DVR and skip at regular intervals. The action is too choppy and I've yet to figure out a good figure.
post #18 of 73
If they invented DVRS that got rid of screen clutter DVR viewing would go up. I got fed up with this and other things and cut the cord back in 2008. I hooked up an antenna and watched a lot of DVDs until MeTV came to my area last fall. I also watch Hawaii 5-0, The Mentalist, and Craig Ferguson on CBS, documentarys on PBS, SNL on NBC and sports in HD on the weekend. Now my DVD player gets little use and I'm pressing the mute button or changing channels when commercials come on.

But not paying for programming that contains commercials, screen clutter, and Reality shows is priceless.
post #19 of 73
Thread Starter 
Quote:
Originally Posted by Garrett Adams View Post

In football a 30 second skip at the end of play will usually get you to the beginning of the next play.

 

I have a rule I never skip content. If I feel the need to skip over parts I'm wasting my time and I'll delete the season pass. Not so much towards sports but as an example a singing contest. I get invested by watching all of the filler versus the two minutes someone actually spends singing. If all I wanted to hear was someone sing I would play one of my CDs... much more entertaining.

post #20 of 73
Quote:
Originally Posted by NetworkTV View Post

The problem is, the commercial skipping and streaming crowds aren't the ones being measured in the ratings.
The ones that plank themselves in front of the TV, watch things as they air then write it all down in a paper diary are.

I did a stint as a Nielsen viewer about a year ago and the diary entries allowed for specifying if the show being watched was previously recorded.
post #21 of 73
Quote:
Originally Posted by bidger View Post

I did a stint as a Nielsen viewer about a year ago and the diary entries allowed for specifying if the show being watched was previously recorded.
I have done this also but there was a rumor that Diary DVR usage was being discarded and only TIVO, Satellite, and CATV supplied DVRs were actually counted, (because those can be independently verified) while HTPC, VCR, and non-subscription HDD DVRs were ignored.
post #22 of 73
Quote:
Originally Posted by Charles R View Post

I get invested by watching all of the filler versus the two minutes someone actually spends singing. If all I wanted to hear was someone sing I would play one of my CDs... much more entertaining.
I'm just the opposite. I don't care the least little bit about all that filler. I just want to watch somebody perform a great song or dance. Which is why I don't watch any of those contest shows. The performance to filler ratio is too low, even with DVRs. I get more satisfaction watching a concert DVD.

I had the same problem with the Glee concert running on HBO. I thought it would be the perfect production for me. I think those kids are super talented, and I love watching them perform, but I had long since given up on the terrible unwatchable stories surrounding the song numbers. So I thought, "Great, I'll watch the concert. All the songs, none of the soap opera". Then, to my horror, I discovered that there was more filler than songs in the concert movie, too. Except instead of watching funny one liners from Sue, I had to sit through even worse personal stories of fans. Ugh. It was too painful to watch. The only way I could enjoy that movie was skipping through the BS to the songs on my DVR.
post #23 of 73
post #24 of 73
Quote:
Originally Posted by Charles R View Post

I
What's suffering at the hands of the DVR is old-fashioned channel surfing, in which viewers might stumble upon an obscure show or a smaller cable network. If the first option is appointment viewing, "option No. 2 is what I have on my DVR," says Sam Armando of Chicago ad firm SMGx. Networks that depend on chance discovery "are starting to suffer a bit."


Also, a lot more people are "guide surfing" instead of channel surfing. I now do more "guide surfing" where I used to be a channel surfer.

For me, it is much easier and quicker to use the guide, Changing channels takes too long and has become cumbersome.
post #25 of 73
Thread Starter 
Quote:
Originally Posted by blitzen102 View Post


Also, a lot more people are "guide surfing" instead of channel surfing. I now do more "guide surfing" where I used to be a channel surfer.

 

I see those pretty much being the same thing... since I have had a DVR for over a decade my surfing has been limited to a few times a year (I'm guessing). If a season pass didn't record it and I don't know about it ahead of time (live sports, etc) I simply don't go looking. Other options trump anything I might find randomly... such as a movie via my NAS, or virtually anything else. :)

post #26 of 73

[quote]The patent, which lists Time Warner Cable principal architect Charles Hasek as the inventor, details how the nation's second largest cable MSO may be able prevent viewers from skipping TV commercials contained in programs stored on physical DVRs it deploys in subscriber homes, network-based DVRs and even recording devices subscribers purchase at retail outlets[/quote]

 

This BETTER not happen. Do what you want with your own stupid boxes, but they have no right to interfere with the functionality of customer's personal, privately owned equipment.

post #27 of 73
Perhaps the new business model would be to eliminate commercials all together. Instead the products would be placed inside the program as props. The Camaros they drive on 5-O are pretty sweet. Perhaps Danny on Blue Bloods could stop in a SUBWAY for a sandwich or Starbucks for coffee. Just an idea.
post #28 of 73
Quote:
Originally Posted by jpillar 
Perhaps the new business model would be to eliminate commercials all together.

Product placement is nothing new, and although it's become more blatant and annoying lately, it would never be enough to make up all the lost revenue from not showing dedicated advertisements. If anything, it would probably decrease viewership and revenues substantially, because the level of product placement necessary to hold a candle to standard advertising models would require turning every program into an infomercial with a weekly plotline.
post #29 of 73
Thread Starter 
Quote:
Originally Posted by Westly-C View Post

[quote]The patent, which lists Time Warner Cable principal architect Charles Hasek as the inventor, details how the nation's second largest cable MSO may be able prevent viewers from skipping TV commercials contained in programs stored on physical DVRs it deploys in subscriber homes, network-based DVRs and even recording devices subscribers purchase at retail outlets[/quote]

 

This BETTER not happen. Do what you want with your own stupid boxes, but they have no right to interfere with the functionality of customer's personal, privately owned equipment.

 

The 30-second skip has been debated for a long time... would they remove it from the TiVo remote. I tend to think they should be able to produce/sell whatever the wish and it's simply my right to decide if I want to take advantage of it or not. By default it fast forwards within a second or so and you can still sort of see the ads. You can code the remote via a backdoor so it jumps which virtually makes them disappear (unless you happen to get off rhythm). Of course you could still fast forward but I find it much more awkward and if I had to my viewing would be reduced.

 

I'm sure they could stop skipping commercials very easily. Similar to forced trailers with DVD and Blu-ray content. In reality it isn't a bad concept to fail back onto if they can't find any other ways of replacing lost revenues. It could come down to you either view commercials or you don't view The Good Wife. Even after a decade of being commercial free I'd probably take the commercials of course I wouldn't be happy about it but I do think they have every right.

 

I know this is a can of worms and hopefully this thread won't migrate into such threads as Enough clutter on my screen... hello, it's their broadcast. :)


Edited by Charles R - 6/19/12 at 5:05pm
post #30 of 73

Yeah, I just posted this on the TWC thread. Shows how far in denial they are about the cord-cutter trend. Follow through with it and watch it accelerate.
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