The Tivo Effect

In 2008, TiVo CEO Tom Rogers shared an unwelcome, yet self-serving, message for the television industry: Most of your ads are NOT going to be viewed in the future.

"There are going to be 50 or 60 million DVRs in homes over the next few years," Rogers says, predicting this number will rise from the approximately 20 million DVRs in homes today. "The majority of television ads in those homes simply won't be seen. It's going to be incredibly painful for advertisers, for the whole television industry, if they don't comprehend the urgency of that."

What Rogers suggested however was that programmatic advertising would replace traditional ads. Instead of the traditional ads shown in between programming, television advertising is going to become more like Web advertising—contextual and interactive, prompting the viewer to click, read, watch, and even buy.

Now, fast-forward to later in the decade with TiVo subscriptions on a steady decline as cable and satellite companies rent their own DVRs to customers—TiVo only had about 1.7 million of the then 20 million DVRs.  The Tivo effect was finally denounced by Duke University researchers who released in 2010 that “TiVo hasn't hurt television advertising or changed consumers’ buying behavior.”

Carl Mela, a professor in Duke’s Fuqua School of Business, attributes; people still watch live TV, despite fast-forwarding feature consumers are still watching the screen and the ability to record shows only increases TV watching.

So in 2015, how has TV advertising fared in the world of DVR?  To be completely honest, well. I mean the reality is people do skip commercials. But only about half the time, according to Stacey Lynn Schulman, chief research officer with TVB, a trade organization representing local TV stations. Schulman says studies show that viewers retain information from ads even when they’re viewed in fast-forward. And sometimes people catch a glimpse of a commercial and go back for more. Some viewers get tired of trying to speed up and slow down to avoid ads and give the remote a rest.

Advertisers have even gotten a small victory when it comes to television recording. Many viewers often too busy or lazy to record their favorite shows will opt to watch the shows on their On-Demand services, which often disable the fast-forwarding option.

While it appears the consistent and resilient world of television advertising has managed  to ride out another technology wave, how is Mr. Rogers’ TiVo doing??

Well to say the least he is restructuring…

On Monday March 30, 2015 TiVo released a partnership to enhance programmatic TV advertising sales. The company suggests that clypd will provide buyers and sellers of TV inventory with targeting data and performance metrics powered by TiVo Research's data products, including the True Target Indices. This information will enhance the data-driven capabilities of the clypd platform for the benefit of those partners transacting programmatic television with clypd.

The question now is, should we believe the hype?