Soon, a DVR in every home. Advertisers groan.

Marketers have been growing nervous about digital video recorders, those boxes now in 1 out of 4 U.S. homes that allow consumers to easily skip over TV commercials. So they may have a heart attack after the Supreme Court cleared the way yesterday for Cablevision to offer virtual DVRs to its customers.

Sure, this looks like just another cable add-on — but as Josh Bernoff notes at Forrester, now Cablevision can launch DVR-type recording options on a system-wide basis vs. installing them gradually in individual homes. DVRs are great for consumers because you can pause regular TV programming during a bathroom break, record shows you don’t want to miss, watch things later, and yes, skip commercials. Bernoff predicts virtual DVRs with clever functionality will expand rapidly as Comcast, Cox, AT&T and others try to differentiate themselves from satellite providers DirecTV and Dish Networks with less-nimble on-demand services. We imagine, for instance, a cable company with unlimited storage could let you build a personal library of your favorite TV shows — a great switching cost to keep you from ditching Cablevision for satellite TV next year. Such services could even slash customer churn among the 7% of the U.S. population who moves each year to a new home, because you could now take your entire library with you remotely — as long as you stick with the same cable provider.

It’s not the end of the advertising world, certainly. Cable companies derive revenue from advertisers and won’t rush to kill their golden geese. Tim Hanlon, EVP of Viva Ki Venture, told the LA Times that advertisers could even use expansion of on-demand video to improve ad targeting.

Still, consumers gain a new remote. There is a huge market for content right now, when you want it, and remote DVRs when ubiquitous will give consumers great control over which messages they see or skip. Advertisers will have to rapidly build more relevant or integrated content if they want to avoid the fast forward button.

Image: Still from video Speed by Atzu.

2 thoughts on “Soon, a DVR in every home. Advertisers groan.

  1. Ben,

    Nicely said. My family has 3 DirecTV DVR’s. We can build about a 300 hour library of shows (even without a nimble on-demand service). 300 hours watched in 4 hour blocks equates to 75 days of inventory. As we knock out 4 hours (American Idol…) we probably pick up another 4 hours… So most of what we watch isn’t real time and my wife relentlessly skips the commercials.

    My daughter often prefers to watch the commercials (on her shows) – she’s 10 – maybe those advertisers are hitting their target market better – or maybe there is something in the 10yo mind that makes her more likely to watch.

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