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November 17, 2004

Fast Forwarding Ads in Tivo

I feel obligated to add my two cents on the now famous decision to put banner ads in Tivo when a user fast forwards past commercials. There are some pithy comments here at Build Your Own PVR, TivoBlog.com,
Thomas Hawk, Ploosh!, SlashDot, and PVRBlog (some excellent comments there too). Basically, there are two camps; one believes that Tivo is selling out and the other thinks this is no big deal. I happen to straddle between them.

First, it's unclear how the advertising will work, and like many things, the devil is in the details. There's a big difference in the way it's been described as either a pop-up ad (giving one visions of having to click a close box to continue)versus a small banner ad that doesn't interfere with your ability to fast forward past the commercial break. If it makes fast forwarding slower or harder, I'm mad as hell. If it's just a corporate logo, I couldn't really care less.

Part of Tivo's problem is the timing and the perception that they are shafting their users by cutting features. Let's look at what has happened recently. First, there's the perception that Tivo will cut any deal with copyright holders to prevent litigation at the expense of users. Next thing you know, Tivo announces that they will be putting restrictions on pay-for-view and other high value recordings so that they won't linger on your hard drive for too long. Finally, they appear to be screwing with our beloved fast forward button. A small banner ad isn't the end of Tivo as we know it, but many users have a good reason to believe this is only the beginning.

I think if they played a smarter PR strategy, this would have been fairly insignificant. For instance, why not introduce this "feature" when they launch TivoToGo? Why not wrap it up with a few new features and call it the new Tivo OS? Instead, it feels to Tivo users that they are becoming a cash cow getting milked daily.

I find a banner ad minor in comparison to the privacy issues that are raised by Tivo gathering statistics. The Janet Jackson SuperBowl malfunction was a revelation for many people when Tivo made the point that it was the most replayed moment in Tivo history. I'm much more concerned by a revenue-hungry company that has so much personal information at its fingertips. With DVD players a new feature embedded in some of Tivo's products, I can't believe it would be difficult for a DVR to record all the DVD titles one views, and I have a feeling many people wouldn't want their steamier movie choices revealed to advertisers.

It's not exactly big news that Tivo needs to generate more revenues to stay in business. Part of that includes finding new customers and part of that is finding new revenue generation ideas. I'd prefer a small banner ad on fast forward over a hike in monthly fees. The big problem is that of perception and the more Tivo users feel like they are getting constantly short-changed, the more they'll likely look elsewhere for their DVR solution.

Posted on November 17, 2004

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