July 2008 - Channel Crossing: DRTV

Don’t Count Out Paid Programming

By Rob Medved

It is an undeniable fact that the past decade has seen very dramatic changes to the paid programming landscape. For many, the knee-jerk reaction to these changes has been to declare that DRTV has passed its prime; that our industry is one on the verge of decline.

Closer inspection, however, reveals a different storyline.

On the distribution front, a few-dozen cable channels have become hundreds (a recent Nielsen study released in June 2008 found that the average U.S. home now receives 118 channels). Analog distribution will soon be completely replaced by digital, while 90 percent of TV households now get their programming from cable or satellite. The number of cable systems has consolidated and dropped almost in half, with the top three controlling more than 80 percent of the households.

The average U.S. household now has more TVs in it than it does people. But are the couch potatoes still watching? According to Nielsen, they are. Even in the face of numerous other entertainment options-from gaming to the Internet-the number of hours a TV is on per day is more than eight, up by more than an hour from a decade ago.

The growth and force of this mass-market medium will continue to foster a healthy paid-programming landscape. As television continues to be the primary device by which we receive content in our home, those hours spent in front of the TV will grow. Although consumers will have more channels, cool new functions (interactive TV, advanced DVRs), more options for content (VOD, Pay Per View) and the ability to access all Internet content on TV, they will also be spending more time in front of the screen. Furthermore, the size, clarity, weight and cost of flat screen technology will put more TVs in more and more places. This is all good news for the marketer, because DRTV feeds directly off of the number of eyeballs watching TV.

Consumers will continue to have more choices to spend their technology-driven leisure time. However, at the end of the day, when they need some time to unwind from it all, they will plop down in front of the set and start flipping channels. And those bored channel surfers will stop on some creative paid program with a unique, new product that grabs their attention and elicits a response. They may be ordering with the click of a remote, or piping from a long-form commercial to the official product website or clicking a button to have more informantion sent to their e-mail box-but they will be there.

These predictions rely primarily on human nature and don’t even factor in the ever-increasing need for major brand marketers to demonstrate solid ROI for their ad campaigns, which plays right into DRTV’s wheelhouse. But that’s a column for another day.
Bottom line: despite all the naysayers out there who say that DRTV’s influence is fading, the fact is that the couch potato is alive and well, and as reachable as ever via the television screen.

Rob Medved is president, CEO and media director of Cannella Response Television, an industry leader in direct response media planning and buying. He can be reached at (262) 763-4810, or via e-mail at [email protected].


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