TiVo: Watch the Ads – Please!

By Geoff Duncan July 18, 2005

TiVo today updated its television recording and time-shifting service to enable customers to respond to specifically-designed advertising. Using the new options, customers who are interested in an advertisement or want to know more can have their contact information released to the advertiser so they may receive more information from the advertiser about the promoted product or service.

In addition, ads with special tags embedded within them will appear on screen as small pictures with branded logos even while users are fast-forwarding through tagged commercials.

The system debuts with specially-designed ad campaigns from General Motors and Time-Warner’s WB TV network, and is available only to TiVo Series 2 customers. Users who obtained a TiVo unit through DirecTV satellite service are not subject to the changed service.

TiVo says the new system still leaves the customer in direct control of their viewing experience, while providing advertisers a greater “entry point” to target TiVo users. For years TiVo has been offering long-form commercials downloaded to customers in the background so as not to interfere with their normal television-watching; TiVo says between 5 and 15 percent of its users choose to view those commercials, and between 5 to 30 percent of those viewers choose to release their contact information to the advertiser.

However, in these privacy-aware times, consumers are increasingly wary of releasing their contact information to third parties, a trend which is likely to rise as consumer irritation with direct marketing and awareness of both identity theft and fraud have become more widespread. It’s unclear whether TiVo or its advertisers can sustain enough trust with their audience to sustain TiVo’s new “opt-in” advertising format, or whether the format will make TiVo’s famous commercial-skipping capabilities any less of an anathema to advertisers.

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