Is ad-erasing technology that bad?

Lisa Fowler | Sep 20, 2012

Hopper Image

In mid-March DISH Network unveiled its whole-home DVR package known as the Hopper. The Hopper DVR lets up to four televisions share the DVR and all its functionality, reducing the need for redundancy in technology.

A short while later they unveiled additional functionality within the Hopper known as Auto Hop. Auto Hop is technology that skips recording ads while recording most primetime shows on network television. It’s a free add-on for Hopper customers. If you think the television industry has embraced Auto Hop and what DISH Network is attempting to do, think again. In fact, Fox Television is so upset with the satellite television giant it has actually filed suit with the immediate hope of getting an injunction against DISH Network and Auto Hop, and in the long term get technology like this banned. The television industry, particularly network canned cable television, essentially has two revenue streams. One is advertising dollars and the other is subscriber revenues. In order to offer free, over-the-air television to the widest viewership possible, these revenue streams need to remain intact. If ad-erasing technology gains a foothold and becomes more prominent, consumers could see noticeable changes. Not only could subscription rates go up at every cable and satellite provider, even for the most basic programming packages, but the amount of content produced for television could diminish as well. Advertising dollars, which help pad production budgets, would be funneled into only the most profitable ventures. This could cause a serious and negative rift through smaller cable networks that rely on unique content to attract viewers. Many of DISH Network’s industry peers have yet to make too many comments about Auto Hop, but Glenn Britt, CEO of Time Warner Cable, has said that something like Auto Hop “could damage the existing ecosystem of television programming and distribution.” Time Warner Cable customers should probably not hold their breath in anticipation of something similar to Auto Hop. Since the invention of the VCR, viewers have been blowing past advertising, which makes us wonder how egregious something like Auto Hop really is. With any DVR on the market it’s a very simple process to get though several minutes of commercials in just a handful of seconds. All this raises the question about the future of advertising in the television industry. Surely television executives know something’s got to change? After all, theirs is an industry that has constantly changed since the earliest days of the evening news and soap operas. However, this change won’t come easy. CBS Corp. CEO Leslie Moonves stated, “Hopper cannot exist…If Hopper exists, we will not be in business with [Dish].” I don’t know about you, but those sound like fightin’ words. What will television executives do to adjust to the next evolution in programming? Will advertising go away entirely with every channel emulating HBO and Showtime? Will advertising have to become more interactive to keep viewers’ attention? Most likely we’re going to have to wait to find out, but if the early response to Auto Hop is any indication, expect the television industry to do whatever they can to preserve the tried and true with a few industry vanguards trying something new and improved.

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