An Assembly of Pieces
 

 
James Anderson Merritt's piecemeal thoughts and observations, and the occasional attempt to put some of the pieces together.
 
 
 
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All material except cited quotations Copyright (C) 2004-2008 by James Anderson Merritt. All rights reserved.
 
 
Sunday, July 14, 2002
 
PAYING TO SKIP TV ADS?


The chairman of the Turner Broadcasting System, Jamie Kellner, has warned us TV viewers that if we continue to skip ads using such devices as VCRs -- especially TiVo, ReplayTV and other Digital Video Recorders -- we may find ourselves paying for TV channels that have traditionally been free. "Don't think for a moment there's a free lunch involved in this," he says.


Let me humbly suggest to Chariman Kellner that people will watch well-produced ads that contain useful product information. I don't think that we viewers want ad-free shows; we even seem to put up with a fair amount of product placement. Spectacular ads are part of the reason that many people watch the annual Superbowl telecast. Shopping channels and infomercials have always found viewers. People look forward to the arrival of weekly advertising circulars and will even pay for newspaper classified ads. We simply don't want to be forced to watch ads. When you think about it, you can't really force people to watch the ads, anyway. Viewers can always flip to another channel; punch the "Mute" button; grab a snack in the kitchen; or even start and finish War and Peace in the bathroom, during the frequent and seemingly interminable commercial breaks that Kellner and his colleagues routinely foist upon the viewing public these days. How is the use of a TiVo or ReplayTV device going to deprive advertisers of the exposure they have purchased, any more or less than vewers' long-established commercial-avoidance strategies? It's not, and I think a smart boy like Kellner knows it. To my ears, his warnings and protestations come off as disinegenuous.


You don't see the editors of TBS sibling Time Magazine worrying about whether people flip past the Absolut and BMW ads, even though the per-copy sales price has never covered more than a tiny fraction of the costs of producing and distributing the magazine. In American magazine and newspaper publishing, as well as commercial television broadcasting, advertising has always done the heavy lifting. So it makes sense that advertisers should get a fair shot at the attention of the reading or viewing public. But in print media, nobody thinks for a moment that the reader is "captive." The advertiser knows that his ad will get no more than a split-second glance before the reader's eyes dart elsewhere, unless the ad content itself commands attention. Even given that challenging ground rule, magazines and newspapers -- even those distributed for free -- can set advertising rates that allow them not only to remain in business, but thrive. Television can and must do the same thing, and not try to depend on the attention of a "captive" viewer. The ability to skip past ads must be seen as the video equivalent of turning or flipping directly to the printed page, and dealt with on that basis.


Kellner estimates that people might have to fork over an additional $250/year for ad-free television content alone. I suppose that amounts to an additional dollar per month for each cable channel that the average viewer now gets "free," or another $20 or so on the typical monthly bill. A small price to pay, some would say, for commercial-free television. But will the "New Pay TV" really be commercial-free? Perhaps at first, but product placement will continue and increase; then, if the history of PBS is any guide, we'll see something like brief "underwriting" messages before and after each show, then full commercials between programs, and finally, back to business as usual: frequent, long commercial breaks throughout a program that itself is stewn with product placements. Of course, at that point, we'll be paying at least three parties for our formerly "free" TV: service fees to the cable companies; subscription fees to the channels themselves; and inflated product prices to companies, to cover their advertising costs.


If you ask me, the industry initiative represented by Kellner's comments isn't so much about replacing one revenue stream with another, it is about priming the public to accept yet another intravenous tap. The players in cable TV appear not to be satisfied with their own slices of the pie; they each want their own pies. For a different angle on this observation, look to another TBS sibling, Time-Warner Cable, which just announced that they will be providing DVR service to their own subscribers, in order to compete with satellite television companies. The T-W Cable box allegedly won't have an ad-skipping function -- perhaps to placate TBS -- but I can't help but think that AOLTW wouldn't hesitate to allow viewers to skip commercials, on their channels or anyone else's, as long as they were the ones to own the PVR and collect the money for the privilege. The TBS protests about ad-skipping may ultimately have more to do with kneecapping potential competitors to T-W Cable's premium-priced DVR service, than preserving dwindling broadcast ad revenues or the "free TV" business model.


AOL Time Warner and other media barons want to charge you separately for connection and content. If they can scapegoat such personal entertainment advances as DVRs to get their way, they will (at least until the competitors are driven out of business and the victors can reintroduce DVRs on their own terms). The real solution to advertisers' problems is to produce better ads that say something a little more interesting than "buy our product" (while nevertheless making that suggestion to the viewer). Ads and trailers already appear on rented videocassettes and DVDs. When they are worth watching, people do. If VCR/DVR-empowered viewers do routinely skip ads, then how much more valuable will be the instances when viewers pause to watch them, or actually seek them out? Advertisers would do best to maximize that potential, and the commercial broadcasters would do best to get along with the revenue they can generate from the "free TV" business model under the circumstances.

 

 
   
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