Did we really need a study to tell us that everyone skips ads when they DVR shows?
A very hot show like CSI makes about $.50 per viewer in advertising. Now, I did this calculation on the back of a cocktail napkin while drinking beers with a CSI executive producer one evening, so I admit it isn’t likely to be very accurate. But really, that isn’t that much revenue to make up. They can make more money via paid downloads and in-show product placements anyway, so they should just stop with the ads. No one likes them. And soon, no one will be watching them at all.
Mike,
I agree that media outlets need to begin aggressively pursuing alternative revenue routs, but this will not happen IMO. They should embrace the direct to consumer download market…minus the ads. However if business history has taught us anything, it has taught us that companies are reluctant to canabalize their main revenue base. However, the irony is that if you dont a competitor eventually will and sometimes even push you out of your own market. The old gaurd will often miss the paradigm shift
We can look at obvious reluctance..cases where certain companies should have been the obvious choices to take new technology and create a new revenue stream.
I think one of the most striking examples of ignoring the paradigm shift is Polaroid. If any company should have gotten INSTANT PHOTOGRAPHY…. similar to digital photography..it should have been Polaroid. But they remained comatose…ignoring the market..now where are they?
Look at how IBM squandered the PC market because they thought it would eat into their bread and butter high margin Mainframe business. If anyone had the capabilities to dominate that market..it would have been IBM at that time.
And these examples are technology based businesses and they did not embrace technology because it was a threat to their high profit businesses.
I fully expect to Media companies to fight as a long as they can to hold on to their long time revenue bases, until they are absolutely compelled to switch revenue models.
Why not give your consumers more options? I am overseas right now and there are certain programs I would definately pay to download because I can not get them here. But I guess this is the market that Apple seeks to expand with the Ipod Video and also Google has stepped in…
I skip Tivo ads. My wife doesn’t. She keeps them playing and does chores and stuff while they’re running. She’s alway telling me about this cool commercial or that. Don’t assume Tivo kills commercials. No more than taking a piss kills commercials.
This is Horrible”
http://www.newscientist.com/article.ns?id=dn9011&feedId=online-news_rss20
The advert enforcer
If a new idea from Philips catches on, the company may not be very popular with TV viewers. The company’s labs in Eindhoven, The Netherlands, has been cooking up a way to stop people changing channels to avoid adverts or fast forwarding through ads they have recorded along with their target programme.