The New Television: Are you afraid of TiVo?

Dec 2, 2002  •  Post A Comment

At this moment, there are probably more burglars inside American homes than digital video recorders. But if you listen to network executives, there’s more to fear from a TiVo than a thief.
The execs say that DVRs, which are now in fewer than 2 million U.S. homes, could eliminate the 30-second commercial, disrupt traditional TV schedules and further reduce the nation’s attention span. If you believe the rhetoric, television hasn’t seen a disrupting influence like this since David Caruso left “NYPD Blue.” The DVR’s capacity to pause live TV, skip commercials and record up to 100 hours of programming has the execs shaking in their Guccis.
But I believe that many of their concerns are unwarranted and are based on a fear of the unknown. If the TV executives actually used a TiVo or a ReplayTV on a regular basis, they would know that the DVR will bring change, not chaos. Viewing habits will be modified, but not dramatically altered. In addition, the DVR could create new opportunities for both advertising and programming.
Below are some of my forecasts on how the DVR will change television. The predictions are based on initial industry research, my firsthand experience of owning DVRs and interviews with fellow DVR owners.
Appointment TV will survive: Some futurists have said that the DVR will eliminate the traditional TV schedule. They predict that the networks will download each week’s shows (other than live events, such as sports) at the beginning of the week and the DVR owner will watch them at his or her leisure.
I think this is nonsense. If a show is compelling, people will still plan their schedules around it. For example, I am hooked on “The Sopranos,” and there’s no way I will wait a second longer to find out what happened in each Sunday’s episode. However, I am a casual fan of Fox’s “24,” which I “TiVo” every Tuesday and watch later in the week.
When DVRs are in 30 million to 50 million homes, the prime-time schedule may be different; perhaps networks will broadcast just one or two shows each evening. But the networks will always be able to guarantee advertisers an audience with certain shows at certain times.
Advertising models will change: The DVR permits users to skip or fast-forward through commercials. (ReplayTV has a 30-second skip button while TiVo requires you to fast-forward through ads.) Network executives have expressed concern that DVR owners will not watch commercials during the playback of a recorded show. But this is just the talk of alarmists. A recent PVR Monitor study found that fewer than 25 percent of DVR owners say they never watch commercials, which is probably not much more than the VCR audience.
In addition, based on my experience and interviews with other users, DVR owners usually skip spots during certain shows, such as intense dramas. You fast-forward the commercials because you want to get to the next scene to find out what happened. However, while watching more light-hearted fare such as sitcoms and variety shows, you tend to let the commercials run.
If this becomes a trend, it could change the way commercials are placed. Advertising officials traditionally believe that viewers are more likely to watch a commercial if they are absorbed in the show. However, with a DVR, they might be more likely to skip it.
Blurring of entertainment ads: With advertising models in flux, DVR companies and their content partners will offer viewers special programs designed to entertain as well as promote. For instance, TiVo recently downloaded a short thriller from BMWFilms.com, the advertainment site operated by the car company. The film, which was directed by John Woo and starred Clive Owen (“Croupier”), featured the most exciting car chase I’ve seen on film since “Bullitt.” Who cares if the objective was to pitch BMWs?
Never miss a favorite show: The networks spend millions on print and TV advertising to remind viewers to watch their favorite show every week. However, with a TiVo, you can make sure you never miss it by clicking the “Season Pass” feature; the set-top will automatically record the program every time it’s on. In a few years, rather than relying strictly on advertising, the networks will start encouraging viewers to get “Season Passes” for their shows. The Season Pass could become as important as the “bookmark” in Web browsing.
Although the DVR has yet to achieve critical mass, some industry analysts say it could be in 30 million homes by the next five years. TV executives need to get ready. But I would suggest that they drop the rhetoric and start the research.
Phillip Swann is president and publisher of TVPredictions.com. He can be reached at swann@TVPredictions.com