I'm pleased to be joined once again by Colin Dixon, senior partner at The Diffusion Group, for the 133rd edition of the VideoNuze Report podcast, for May 18, 2012. This week's topic: Dish Network's new "Auto Hop" feature, which automatically skips ads in DVR-recorded broadcast TV.

Colin kicks off the discussion by relating his personal experience, as a Dish subscriber, with Auto Hop. He calls it "freaking awesome," a sentiment expressed by many others this week. Auto Hop strikes a chord with viewers not just because it extends the DVR's core ad-skipping capability, but also because viewers see it as a tool to strike back at TV networks for years of all-to-often irrelevant and inane ads forced upon them.

Of course, expensive-to-produce TV programming must be paid for somehow, so if Auto Hop gains traction - and possibly spreads to other pay-TV operators - the net result is that the TV networks, who are plenty upset by Auto Hop, will seek to offset the revenue loss either through higher fees from operators or from viewers themselves. This is the touchy position Dish has placed itself in by being a pioneer. When it tries to renew its distribution deals it will surely face higher fees.

Auto Hop feature further raises the ante about the future of advertising generally. Pay-TV operators have eagerly promoted DVR capabilities, driving adoption to 50% of American homes, in turn engendering a massive wave of ad-skipping and time-shifting already. This has contributed to both to live TV audiences declining for 14 straight quarters, and to many viewers thinking an ad-free experience is now a given. As Colin points out, and I wrote earlier this week, online video - with it's non-skippable ads - may indeed be the networks' best shot at restoring their ad model. That means Hulu could take a more central role in the TV networks' future.

One thing is for sure, the world is changing very fast: viewers are more in control than ever, forcing TV networks to innovate their business models. Auto Hop ensures there are lots of twists and turns yet to come.


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