Will TiVo Destroy Ad-Supported TV?

windowpain writes "According to a column in Television Week, the increasing popularity of digital video recorders will actually cause a decline in ad revenues in the next few years. 'The rollout of DVR-type technology ... will reach critical mass with 11 percent penetration of U.S. television households by 2005 and 15 percent by 2006...As a result, five-year earnings growth for TV station groups could fall from as much as 10 percent to as low as 4 percent.' Why? DVR users skip at least two-thirds of commercials and the 'collective impact represents a threat to revenue and cash flow growth that cannot be offset ... Fifteen percent DVR penetration implies that 9.1 percent of all ads would not be watched and that advertisers would be overpaying by 9.1 percent, or $6.6 billion as calculated from projected 2006 total ad revenues of $72 billion.' And another business model goes down in flames."

Comments

Re:British TV

[shepd]

Great...

Nothing beats living in a police state, does it?

Has a white van visited your neighbourhood yet, checking to see if you own an illegal TV?

And what if you don't like the Beeb? Most people in North America can get it, but almost none of them have ever tuned it in (nothing worth watching). Oh yeah, that's right -- this isn't opt-out -- it's like spam. An unwanted cost for crap you would rather delete.

And yeah, Canada sucks for the same reason (oh how I loathe the CRTC and CBC). Except for the police state stuff. The government doesn't drive around with white vans looking for US satellite equipment.