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PVR Technology Will Force Advertisers To Adapt, Says Forrester

PVR Technology Will Force Advertisers To Adapt, Says Forrester

At present, personal video recorders (PVRs) are considered a niche product and fears that they could spell the beginning of the end for television advertising (see Insight Analysis: Should Advertisers Fear Digital Video Recorders?) have so far proved unfounded. However, take-up is on the increase (see PVRs To Emerge As A Force, Says Informa Media) and a new study from Forrester Research highlights the level of anxiety about the new technology.

The report, Will Ad-Skipping Kill Television? was compiled in association with the Association of National Advertisers. It claims that half of TV viewers will have PVRs or Video-On-Demand (VOD) by 2007 and traditional ad-viewing will have dropped by 19%. As a result, revenues are set to fall by $7 billion in the next five years.

However, all is not doom and gloom and Forrester suggests that the deficit can be made up in other areas. “Ad-skipping won’t destroy the TV business,” said the report’s author, Josh Bernoff. “New ad revenues for commercials in video-on-demand will nearly make up the shortfall, and we also expect consumers to pay $6 billion for new services like subscription video-on-demand in 2007.”

Bernoff also says that advertisers need to link their ads more closely to programmes and reserve 5% of their media budget for non-standard formats such as interactive programme-guide panels, interactive commercials and ads on PVR menus which cannot be be avoided by ad-skippers.

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