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Jupiter: DVR Ad Skipping Threatens $8B in Advertising

A JupiterResearch study has found that 53 percent of online digital video recorder (DVR) subscribers used their DVRs to skip some commercials. If these households were to skip all commercials, the cable and broadcast TV advertising revenue at risk in 2006 would be $8 billion out of the $74 billion TV advertising market, according to the report, "The DVR Dilemma: Managing Consumer Behavior."

DVR users who skipped commercials report watching an average of 18 hours of television per week - not significantly more than viewed in non-DVR homes. Todd Chanko, JupiterResearch analyst and author of the report, said "only for those homes that record and watch a show the same day or week does DVR use boost overall TV watching, from 17 hours a week for non-DVR homes to 20 hours a week."

"The $8 billion segment of cable and broadband TV advertising revenues potentially at risk due to DVR commercial skipping is not a foregone conclusion, but reworking ads to leverage the unique DVR experience could open new avenues of creativity and relationships with viewers," said David Schatsky, President of JupiterKagan.

"Current efforts by certain networks to charge for prime-time reruns via DVR technology do little to boost revenue and almost serve to penalize DVR users who forgot to properly program their unit," said Schatsky.

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