PVRs Threaten 30-Second Ads, Says Yankee Group

Ever since it was introduced as a concept, advertisers have lived in fear of PVR technology, which allows users to avoid commercial breaks (see INSIGHTanalysis: PVR Users Regularly Avoid Ads). This apprehension is currently misplaced given that, according to the study, Death of the 30-Second Commercial, less than 2% of US homes own an ad skipping device.

Even so, the growth rate is accelerating and broadcasters and advertisers will have to sit up and take notice when in mid-to-late 2005, the number of PVR subscriptions is expected to reach 10 million.

“With satellite and cable operators and consumer electronics manufacturers integrating PVR technology into set-top boxes and other devices, we forecast 19.1 million homes will have PVRs by year-end 2006,” said Yankee Group analyst, Adi Kishore.

The upshot of this is that marketers will have to consider “guerilla” branding initiatives as different creative products become a requirement fo different TV advertising formats.

Changes will not occur overnight and the 30-second spot is set to remain the most widely used format for the next five years. However, by 2007, it is reckoned that one-fifth of all US homes will be able to fast-forward TV commercials and the implications are seen as far-reaching.

“This subversion of the ad-sponsored TV model eventually will disrupt the entire value chain for television,” said Kishore.