InteracTiVoty: Value of DVR Inventory - Mark Risis - MediaBizBloggers

There is real value for advertisers and networks when viewers use DVR technology to record, pause, rewind, and fast-forward through content and commercials.

That's right, you heard me, there is real value in all that behavior that heretofore was seen as a threat - or something to collectively avoid talking about, since linear TV advertising is better than ever!

Unfortunately, for those of us that frequently look at second-by-second viewership data, avoiding the conversation is out of the question. The behavior is real, commercials are fast-forwarded not only in scheduled recordings, but also in "live" programs that get time-shifted simply by pausing the screen and walking away for 15minutes. Our ongoing research clearly says that viewers would rather wait to watch their shows later than to sit though ads that they know they can avoid.

But while we do see a threat looming, we don't believe that it's all bad news. We see an opportunity, where the value created is proportional to the value lost in linear ads. Let me try to explain.

The usage of DVR technology by viewers to shape their video consumption – Pausing, Recording and Fast Forwarding – has a two-fold correlated effect. The first, discussed above and in many other articles and conference rooms, is that the value of Traditional TV marketplace decreases. How much depends on who you ask, but if you're going to tell me that there's no value lost to fast-forwarding, you may as well stop reading here, since you live in a different universe than I do.

At the same time, there is an increase in volume of ad units that appear as a result of DVR time-shifting behavior. These are ad units that appear before viewers watch recorded programs, after they watch recorded programs, when they Pause live or recorded programs, and even when ads are being fast-forwarded.

So the more value is lost in linear, the more value is created in behavior-triggered ads. In a way, this could be the "Newtonian Law of Media" - media value is neither created or destroyed, it simply transfers from one medium to another, and in the case of DVRs, it all happens on the same screen and around the same content.

Here are a few immediate implications:

· The more DVR usage, the more DVR inventory created
· The more DVRs, the more inventory created
· The most time-shifted shows – prime-time broadcast bread-and-butter – are also the most DVR inventory rich

This DVR inventory and all relevant measures of impression delivery and targeting are currently available in TiVo homes. But DVR behavior can be found in nearly 40% of TV homes – so there is a whole lot of behavior out there that could be monetized, but at this point in time, is not.

Pick your metaphor of choice here – lemonade from lemons, glass half full, brighter side….I'd like to think of it as turning a leak into a fountain. And if DVR inventory is deployed on all DVRs, we're talking one big fountain of value for advertisers to enjoy.

Mark Risis is Director of Interactive Advertising Sales for TiVo, Inc. Mark can be reached at mrisis@tivo.com

Read all Mark’s MediaBizBloggers commentaries at InteracTiVoty - MediaBizBloggers.

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