What precludes cable providers from controlling the ads via the DVR/box?

March 7, 2013 8:31 AM

What precludes cable providers from controlling the ads via the DVR/box?

(just a random question I've had bouncing around in the back of my mind for a while. I am not from the industry so I very well may be operating under misconceptions)

So, today tv ads are (mostly) run by the networks and are a part of the content those networks provide to the cable provider.

What is stopping cable companies from flipping on the networks and insert their own ads via the DVR/box? If I am TimeWarner, or AT&T Uverse or whoever, why don't I simply pause the content they provide and inject my own ads into the stream?

I could see a lot of use cases for this. For example, Uverse could decided to let me choose how much I want to pay per month for cable, and they could show me an amount of advertising that corresponds to my choice (high monthly fee, no ads; low monthly fee, lots of extra ads)

Obviously the networks would probably be pretty pissed about this, but without the telecom providers they lose out on a large part of their distribution model.

I could even see this applying to High Speed Internet access, where the option of low cost monthly billing would result in interstitial ads.

I'm not saying this scenario would be good or bad, and I'm not a big fan of the telecom providers at any rate, but I'm curious why something like this hasn't happened. I am sure it is something they have thought of but I don't see the potential for upsetting each other as a high enough barrier to trying something like this. Or maybe someone is doing this and I just haven't heard of it.

I'm sure you clever MeFis have some ideas!

posted by halseyaa to technology (7 answers total)

What precludes cable providers from controlling the ads via the DVR/box?

The contracts between the networks and the cable providers undoubtedly preclude this. The cable providers need the networks just as much as the networks need the cable providers, at least for the time being.
posted by alms at 8:35 AM on March 7 [3 favorites]

There are a few different kinds of ads. Network Ads, which MUST run and the Network will lock the cable provider into running them as part of their agreement.

There are also slots that the cable providers get to sell. They can be within the Network Ad time, you'll see this mostly on everything but the big 4 networks.

So if you're watching a Law and Order re-run on TBS, some of the ads will be through TBS network, and some of the ads will be through your local cable provider. So along with a Cascade commercial, you'll also see a commercial for "Y'all Come N Get It, Ribs and Bait shop in Decatur, GA."

Also, ads mean money, and no one is messing with that.
posted by Ruthless Bunny at 8:39 AM on March 7 [2 favorites]

FWIW, I'm on Comcast and they regularly preempt ads for their own. Quite often, you will catch just a millisecond of the real ad start and then quickly get overridden by the Comcast/Xfinity ad. Sometimes the cascade of Comcast ads are so heavy, some shows almost seem to be exclusively sponsored by them.
posted by Thorzdad at 8:40 AM on March 7

I'm pretty sure, though, the preemption isn't at the set-top box. It's at the main facility.
posted by Thorzdad at 8:41 AM on March 7

Broadcasts have spots designated for insertion of local commercials. For network programs, these are sold by your local network affiliate. For basic cable programs, these are sold by the cable provider. It's a form of revenue sharing.

If your cable system has improperly configured its audio routing, you might even hear the touch tones that signal the insertion point.
posted by kindall at 8:41 AM on March 7

The above answers are correct, but also, the networks and cable companies are absolutely working on technology to insert individualized ads in those slots, though it would be at the broadcast center and not the DVR.
posted by chrchr at 9:03 AM on March 7

The cable companies have been working on dynamic ad insertion into VOD and (to a lesser extent) DVR playback for a decade or more. In fact, the industry has a five-year-old joint venture called CANOE devoted to just that.

However, progress has been very slow, and CANOE a year ago had a major restructuring and dropped a bunch of its more ambitious programs.

The biggest reason for the slow pace is that only "natural" inventory for dynamic insertion is "spot cable" positions -- adds that the cable companies, not the networks, sell -- and it is a tiny market. The networks and broadcasters have an agenda which is 180 degrees opposite: persuading advertisers that Live and Live + 3 on hit televisions hows remains something they are supposed to pay for and that enough people are watching linear / traditional advertising. The last thing in the world that Disney wants to do is to persuade advertisers that they aren't supposed to care about the show or its broadcast slot, but simply try to be on whatever show that an 18-49 year old male happens to be watching on Thursday at 9 p.m.

This is sufficiently built into the thinking that dynamic insertion will (in my view) have to come from partnerships of non-traditional content channels on over-the-top platforms rather than those of the controlled by the cable company -- i.e., it's going to be something that AppleTV, Roku, or Xbox will create and offer as an option to content partners who are already ad-supported (e.g. Hulu, Crackle) or who want to create an ad-supported option to go along with their a la carte or streaming models (Netflix, Vudu, Amazon).
posted by MattD at 10:37 AM on March 7 [3 favorites]