Although penetration is currently low, digital video recorders are a significant long term threat to television and in the future more advertising will be integrated into content or overlaid on top of programmes, said an analyst at the recent Merrill Lynch US media conference.
This sentiment was echoed by a number of other key speakers who said that DVRs are revolutionising the way people watch television and in turn handing control over to viewers.
Not only do consumers now have a multitude of channels to choose from, they can also record programmes on new devices such as DVRs to watch at a later date, in short, people can watch what they like, when they like.
Previously, many in the industry predicted that the introduction of DVRs would cite the beginning of the end for television advertisements, as one of the main features of the device allows users to fast-forward past commercial breaks.
These fears may be turning in to a reality according to a recent DVR study from Viacom, it shows that many people are utilising the time-saving advert skipping function, the research revealed that 40% of recorded DVR shows are played, with 70% of commercials skipped.
In the UK, DVRs pose as much of a threat to advertising as they do in the US. During this year’s Edinburgh International Television Festival, Stuart Mison of Octagon said: “Television has to be more creative to ensure big brands don’t turn their backs and advertising budgets on television.” (see TV Broadcasters Battle To Attract Advertisers).
One solution to the problem is advertiser funded programmes (AFP), in which advertisers plug a short-fall in broadcasters programme making budget, in return for their product(s) being placed alongside the programme, said Mison.
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