Tivo Now Displays Banner Ad When Viewers Fast Forward Past Them, Consumer Information Shared On Request

Tivo, the leading provider of digital video recorder (DVR) services, announced this week that viewers who fast forwarded past commercials would see a banner advertisement.

Technology fans have long known how to zap TV ads and watch their favorite season of the hit Fox show 24 in something closer to 17.5 hours. That show, as well as a groundbreaking M*A*S*H episode in the 1970s, shows the fictional characters' actions in what is purported to be real time, including commercials.

But other shows simply don't acknowledge the industry average 8 minutes of every 30 that is dedicated to commerical advertising that pays the bills. Tivo users improved upon the old-style of fast forwarding past commercials while still displaying them on the screen like viewers did with early video tape recorders.

Now the Bay Area, California company is fighting back. Its reportedly 1.3 million subscribers will view a banner advertisement when fast-forwarding past a commerical. According to a statement from the company on July 19, advertisers will be sold the ability to insert a "custom" tag in their advertising, rather than the generic tag that allows viewers to easily skip past commercials. The Tivo system will then allow viewers to select whether they want to receive more information so that "...advertisers can track leads to conversion and ensure a qualified return on investment."

Tivo's Chief Financial Officer David Courtney said in a statement, "Companies today are spending an estimated $60 billion a year on broadcast advertising. Ours is the only DVR to effectively enhance traditional TV advertising via a branding and direct response platform. Existing TiVo advertisers are already well ahead of the competition, learning about what type of content consumers will voluntarily view, how their traditional television media is consumed in a DVR home and what types of interactive advertising features can enhance their advertising messages as the technology develops."

Courtney also lauded the company's ability to provide advertisers "...with the ability to receive leads directly from their TV spots, with the viewer's consent, so advertisers can track leads to conversion and ensure a qualified return on investment."

But that latest twist has some consumer advocates worried.

"We know that advertising pays the bills and there is no such thing as free television," said Consumer Help Web President Joan Bounacos. "We are very concerned about Tivo's plans to share personally identifying information with a consumer's viewing habits. The technology has long existed to track what and when viewers watch, but Tivo is using their new technology to help advertisers track household-level data. Who is to say that down the road the company won't tell an advertiser that a viewer's household requested information on Product A two months ago and now wants information on Product B?"

"This is a slippery slope to privacy concerns that we don't think the company has done well enough to explain to its consumers," Bounacos said.

Tivo, has long been searching for additional revenue streams to supplement the sale of its recording units and subscription services. Dun and Bradstreet's Hoovers.com service estimates the company's 2005 revenues at $172 million while losing nealry $80 million.

The web's blogs and bulletin boards are naturally chooked with posts criticizing the change, but most seem centered on the viewer being subjected to advertising of any kind. Few, if any, speak to the consumer privacy issues that potentially loom large for the company and DVR market as a whole.

General Motors and The WB Network are the first advertisers who will use the new technology according to Tivo.

posted by Consumer Help Web Editorial Team at 9:01 AM |