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DVR usages serious impacts TV ratings

Filed in archive Business Trends by martino on December 23, 2006

DVR usages serious impacts TV ratings
There has been a big tug-of-war this last year about whether time-shifted television viewers should factor into a show's ratings. I don't write much about it because on its surface it may bore many of you. However, I ran across David Goetzl's comments and they help highlight the real issues involved.

David's column looked at recent episodes of NBC's 'The Office.' According to David, "the data are likely to show that a full one-fourth -- 25%--of 18-to-49 viewers watched via DVRs. Bottom line: networks' failure to get paid for more than just "live" viewing could cost them big dollars."

What David is reacting to is that there has been a jaw-dropping increase in the number of viewers watching in time-shifted fashion. I am a proud member of that category. And if everyone watches DVR like I do, they likely skip the commercials.
"In comparison to the much lower-rated Office, top-five hits Grey's Anatomy and Lost have seen 'live plus seven' ratings increase by a respective 18% and 17% over 'live' ratings, but no episode appears to have crossed the 20% line."

This is proof that DVR viewing is growing at a fast pace. Just a few months ago NBC research chief Alan Wurtzel called it "stunning" that 18- to-49-year-olds in DVR homes take in more than 40% of their prime-time viewing in time-shifted mode. I am only stunned that it is not higher!

But should you or I care about our time-shifting habits. Well, mostly no but there is one major wrinkle on the business horizon that could affect us: advertising. NBC does not get to charge for viewers that watch on DVR's. The major presumption being that everyone watching time-shifted skips the ads. As more of us begin to watch that way, television producers might not make enough money to justify larger budget shows.

What surprises me is that NBC has opted not to stream "The Office" on NBC.com and the reason appears to be "to maintain its eventual value in syndication." That may be a quaint notion from now on. My thought is that whoever picks up the show in syndication will also devalue the product for the same reasons effecting NBC in prime timelinks.

But streaming the show on the Internet produces a totally new ad buy that NBC can use to monetize the show. I predict that someday they will see that too.


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Tags: Nielsen  ad+rates  CPM  digital  2007  impacts+ratings  serious+impacts  usages+serious 

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