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Week In Review: DVRs Are Going The Way Of The Dinosaur; YouTube To Start Taking Paid Recommendations From Music Labels

1. DVRs Are Going The Way Of The Dinosaur

This is something we’ve been calling for a while now and the latest Nielsen reports bear us out: DVRs are dying out, especially among the younger generation. It’s a behavior we’ve seen in our own homes and it’s not all that hard to figure out why—DVRing, the practice of actually having to remember when a show is airing according to the linear schedule, so that you can then record it, is fixture of an older generation of TV viewing.

In the newer, time-shifted, TV world, all you will need to know is the name of the show and the latest episodes will be available for you instantly, via voice command. That’s already happening at some level, as many networks, notably HBO and Showtime, make episodes available on their streaming apps at the exact same time they air. So that if it’s 9:08 and you realized you forgot to tune in to Westworld, all you need to do is fire up HBO Go and there it is, ready to watch from the start.

Why It Matters

DVRs enabled a behavior that struck fear into the hearts of networks executives worldwide: ad-skipping. Many DVRs even let you skip in 30 second increments to be, you know, extra sure that you’re zipping past the ads.

VOD, on the other hand, generally comes with non-skippable ads these days. Which is why the networks have eased up on giving the MVPDs rights to the current season stack.

(Quick history lesson: VOD was originally conceived of as a marketing ploy. Viewers would see all the great shows available, maybe watch an episode or two, and then begin watching the show live. No one expected viewers to make it a primary means of watching what was still very much a live medium and so little attention was paid to the interface. VOD was also completely ad free back then and so in order to ensure that viewers didn’t use VOD to watch shows without ads, the networks were limited to the five most recent episodes of the current season as opposed to the entire stack. It’s only been in the last year or two that some networks began to realize that, given non-skippable ads on VOD and current viewer expectations of instant gratification, letting the MVPDs have the full season stack is a smart move.)

What You Need To Do About It

If you’re a network, realize that the VOD train has left the station and is already steaming down the tracks. Let the MVPDs have your full current season stack. Holding it back from them is not going to make more people watch live. It’s going to make fewer people watch period.

If you’re an MVPD, please, for the love of all that is holy, do something about the interface on your VOD offering. Most of them are beyond painful and you’d increase stickiness tenfold if you just showed those interfaces some love.

If you’re an advertiser, understand that much of your audience is going to be watching via VOD and set your media plans accordingly.

And finally, if you’re an ad agency, be very happy that people will no longer have the technology to easily skip past your TV commercials. Though we’d urge you to consider why they wanted to do so in the first place.

 

2. YouTube To Start Taking Paid Recommendations From Music Labels

Two situations near and dear to our hearts play out in this next story, about YouTube’s decision to begin allowing record labels to pay for better pole position in their music recommendations.

The first is who is responsible: Lyor Cohen, a well-known former record company executive who is now YouTube’s Global Head of Music. For some time now, we’ve been banging on that one reason MCNs, telcos whose names begin with V and internet companies have such a hard time in the entertainment space is that they hire the wrong people. Rather than bring in people with actual Hollywood experience, they hire some random engineer or direct marketing success story who proceeds to make a mess of things, e.g., Scare PewDiePie. But Cohen has strong entertainment industry chops and understands how the music business actually works.

The second is paid recommendations. This is going to become a nice secondary revenue stream for the MVPDs as they move their program guides from a grid based system to a recommendation based one. If recommendations are done right, they’re fairly seamless. We’re guessing many/most Spotify users have no idea that they are sometimes seeing paid recommendations. They also give the networks a way to promote their programming to a very targeted audience, one who is looking to watch a TV show at that very moment. That’s a all around.

Why It Matters

The media ecosystem is changing. Too many view recommendations through the prism of Taboola and Outbrain, two systems that feel an appropriate recommendation at the end of a thought piece about the French elections is “Ten Hollywood Stars Over 40 Who Have Gone Topless On Camera.”

But in reality, recommendations can be seamless and can enhance a platform’s bottom line without detracting from the user experience, resorting to clickbait or shunting independent work off to Neverland.

What You Need To Do About It

If you’re an MVPD, start thinking about how you’d build paid recommendations into your revamped program guide.

If you’re a network, think about how much better your promotions might be with better targeting and how much less reliant on Facebook you’d be.