Itsme

New TiVo strategy to encourage ad viewing
TV recording firm to insert symbols that identify advertisers in breaks

8:08 a.m. ET July 18, 2005
SAN FRANCISCO - Digital video-recording company TiVo Inc., famous for helping customers skip commercials on their favorite television programs, is taking steps to encourage viewers to watch them.

TiVo, based in Alviso, Calif., has announced plans to insert symbols that identify advertisers during commercial breaks, making them more visible even when a customer is fast forwarding through them.

The ID tags are designed to alert TiVo customers to certain products. If customers are interested in learning more, they can pause the show they are watching to receive a “long-format” commercial or obtain information about the product. The new campaign will be launched with General Motors and The WB Network commercials.

“TiVo’s proprietary advertising technology presents a real opportunity for advertisers to enhance the effectiveness of traditional television advertising,” said TiVo chief financial officer David Courtney.

But encouraging TiVo customers to download ads could be a tough sell, analysts have predicted. People subscribe to TiVo’s service, which allows customers to make video recordings of their favorite TV shows, precisely to avoid commercials.

The new commercial strategy is the latest attempt by TiVo to generate ad revenue for the company, which has yet to turn a profit since its founding in 1997.

Despite the company’s loyal following of 3.3 million subscribers, TiVo has labored to increase its subscriber base. In its first-quarter report in May, TiVo reported a loss of $857,000. The company has said it would reach profitability in the fourth quarter.

© 2005 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Cubsfan

Why don't they just get to it and start paying us to watch them?

zero2dash

Commercials = teh suck

I'll never watch commercials on a DVR-recorded program. Then again thank god I have DishNetwork so if TiVo starts going nuts it won't affect me.

I've never understood how pay TV subscribers see commercials. Shouldn't it be that if it's free TV (ie over the air) you should see commercials 'cause you're not paying for it, but if you pay for TV service (ie cable or satellite) then you don't have commercials since you're paying to view the content which gives those people their money...? Think about it...

Cubsfan

I'm not sure, but I think a lot of the money for your cable or satellite bill goes toward transportation. i.e.: Pays for getting the content to you.

Butch

Precisely. The fees are for the transmission and not the content itself. If you want your cable bill to cover both the transmission AND the content, prepare yourself for a MUCH bigger and MUCH more complicated bill . . .

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InfiniteNothing

Man... with the $14/ month fee how are they not making a profit.

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Butch

I think there's a little communication disconnect . . . Zero was using "Pay TV" to refer to Cable and Satellite as opposed to Broadcast . . . he/she (?) wasn't referring to HBO/Showtime, etc.

The terminology is a little confusing and often erroneously used interchangeably.

But you're right, the premium cable channels that charge $14/month do cover both transmission AND content in their fees . . .

However, the fees you pay for the channels that come within your provider's basic packages do not cover content . . . just transmission.

Kevster

Just another reason why I love my ReplayTV unit.

Commercial-skip on my 5080 (5160 with the "upgrade" I put in) is a Godsend.

__________________
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My small adventures, my fears.
The small ones that seemed so big,
For all the vital things I had to get and to reach.

And yet there is only one great thing, the only thing:

To live to see the great day that dawns,
And the light that fills the world.

-old Inuit song

InfiniteNothing

I was talking about TIVO... seriously, what are their big expenses?