TV networks declare war on advert skipping

IF WE THOUGHT the regulatory situation with TV broadcasting was messy in New Zealand, trust me, it’s peanuts compared to what’s happening in the US right now.

The big US TV networks NBC, CBS and Fox are suing Dish Networks over its new set top box feature which allows users to automatically skip adverts. Remembering that this is happening in the land of the fee, and the home of the law firm, Dish network’s legal rottweilers are counter-suing them right back and have added broadcaster ABC… just because they can. As usual, there’s a whole lot at stake.

Superficially, for the average Joe and Joanne, not to mention everyone else involved, a set top box that can automatically skip advertisements sounds awesome: Broadcasters still get to sell advertising aimed at viewers watching without a box that can skip adverts, while those with Dish network set top boxes get an easier way to avoid ads (and who wouldn’t want to, given how truly ghastly US TV adverts are) and Dish gets new subscribers eager to take advantage of the new technology. So why has this gone thermonuclear with multiple TV networks pressing the big red button marked “Nuke Dish Networks”?

The answer here is advertising generated income, and lots of it.

CBS has explained its lawsuit in a statement to the media by saying that it believes that Dish is a service that “takes existing network content and modifies it in a manner than is unauthorised and illegal. We believe this is a clear violation of copyright law and we intend to stop it.” Fox’s explanation wasn’t terribly different, except to say that it was “given no choice but to file suit against one of our largest distributors, Dish Network, because of their surprising move to market a product with the clear goal of violating copyrights and destroying the fundamental underpinnings of the broadcast television ecosystem. Their wrongheaded decision requires us to take swift action in order to aggressively defend the future of free, over-the-air television.”

What is clearly at stake here is the very TV viewing experience of couch spud kind both in the US and anywhere that imports US designed set top boxes (such as New Zealand and Australia and the rest of the western world). In the US, adverts typically outnumber actual TV content across most networks, and most of those adverts are not only dire, but are also typically incredibly intrusive and annoying so it isn’t a huge surprise that there is a big demand by viewers to automatically skip them. Trouble is, adverts also pay for the content we all want and there is little in the way of an incentive for corporates to cough up large amounts of money for adverts that only a fraction of the national population will watch (that those left watching adverts are not likely to be the intended target market – as they’ll be either too poor or stupid to get a set top box able to skip adverts probably doesn’t bode well either).

NBC’s statement pretty much sums this up: “Advertising generates the revenue that makes it possible for local broadcast stations and national broadcast networks to pay for the creation of the news, sports and entertainment programming that are the hallmark of American broadcasting. Dish simply does not have the authority to tamper with the ads from broadcast replays on a wholesale basis for its own economic and commercial advantage”.

Dish hasn’t taken this lying down, and its senior vice president of programming David Shull responded by saying that “consumers should be able to fairly choose for themselves what they do and do not want to watch,” going on to say that “viewers have been skipping commercials since the advent of the remote control; we are giving them a feature they want and that gives them more control.”

Dish’s counter argument against the networks argues that what’s at stake is “freedom of consumer choice [and] individual families’ choice to elect, if they want, to time shift their television viewing and watch recorded television without commercials”. Dish clearly needs to demonstrate that the claim it is bootlegging signals from the broadcasters is bogus (which shouldn’t be hard to do given Dish must have licence agreements with each of the three networks suing them).

Regardless of this, Dish also probably has a fairly compelling argument that its set top box is merely doing what existing and similar widgets (ranging from channel switching remotes to the hard drive recorder and even the ancient Beta or VHS VCR) have been able to do for the last 40 years – namely giving viewers the option of fast forwarding or skipping ads.

Still, regardless of the outcome of this legal flea circus, it is theoretically possible that it could be mandated that future set top box designs be altered so they can’t skip adverts. Having said this, might it not be an idea to create more pleasant adverts and perhaps less of them? Perhaps the networks could even look at creating adverts people actually want to watch, as shocking as the concept might be. Sadly, about the only clear winner likely to emerge from this fiasco is likely to be the lawyers. PAT PILCHER

7 Comments

  1. Pat, haven’t there been set top devices for some years that can skip ads? I thought that TiVo in the US was capable of this; but modified in Australia and NZ so that it couldn’t. So the question is: why are the networks taking such exception to Dish?

  2. Good point – Yes as the story points out, there has been advert skipping tech around since the VHS VCR (which was more of a fast forward than a skip but the principle is similar enough)… the argument really comes down to money – Advertising generates the cash that keeps the networks alive. Less viewers watching adverts will eventually equate to less advertising revenues and networks such as our own TVNZ cannot afford to survive with their present scale on what they get from the government.

  3. The ad agencies and the TV networks are still telling people that viewers aren’t using PVRs and recorders to skip the ads, and that TV advertising is as effective as always. Do you seriously know anyone who just sits there like a stunned mullet watching ads that they could skip?

  4. I know! The big US networks are clearly living in lala land.. they fought a battle similar to this in the 80’s arguing copyright with the VCR and lost. There is an existing legal precedent that could see Dish win…

  5. I know people who sit there like stunned mullets watching ads, I think you might be surprised at how much of the US and NZ population just sit in front of the TV. So many people just come home and put the TV on, they don’t care what’s on they just watch it. I’ve flatted with people like this. We are probably a slightly different group of people, those who watch only the shows they’re interested in and just put some music on for the rest of the evening, or go and socialize. Don’t people who really want to skip ads just download it these days anyway?

  6. for many the internet has become their vcr…. once the networks work out how to make money from this it’ll be all go but for now the TV networks seem to be hell-bent on litigation

  7. I don’t understand why CBS, FOX, & NBC execs don’t want us to enjoy commercial-free TV. I’m a DISH employee – AutoHop is great because you can easily watch commercial-free TV. Public Knowledge, a consumer advocacy group, is taking a stand for consumers by creating a petition that tells CBS, FOX, & NBC media to keep their hands out of your living room & DVR. Sign their petition to keep control of how you watch TVhttp://bit.ly/KFdn1Q

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