It all "adds" up: TV commercials of the future: "with pressure from [digital video recorders], advertisers and ad agencies searching for something to replace the 30-second commercial are utilizing placement with a vengeance, especially in game, reality, ad lifestyle programs." - Mass Media

USA Today (Society for the Advancement of Education), Nov, 2003 by Raymond L. Fischer

Are TV networks and advertisers concerned? Indeed, they are. Although some speculate that the small number of homes having PVRs indicates commercials will remain unchanged for years to come, most advertisers are more realistic. Media moguls have discussed the threat of PVRs to the traditional 30-second advertisement at most conferences since 1999, when TiVo hit the market. At the Consumer Electronics Show in Las Vegas, Nev., in January, several presenters emphasized that the more than 2,000,000 DVRs in use indicate fast-growing popularity among the country's TV viewers: research shows that 70-80% of DVR users regularly bypass commercials. The ad industry is just beginning to realize that there soon may be a need for alternatives to the 30-second spot. Turner Broadcasting CEO Jamie Kellner has been warning consumers that TV households may have to start paying for broadcast programming. Viacom President Mel Karmasin forewarns that "we give you all this great content for free, and all we ask is that you watch our commercials. If the time comes when you do not watch our commercials, then we will have to make our money some other way." That "some other way" means the public will be expected to pay for watching "free" TV. However, that is highly unlikely--the FCC would interfere and the general public would rebel.

DVRs will not cause commercials to disappear from the airwaves--commercials of tomorrow will be integrated better and will become more relevant. TiVo's research department found that people do not reject advertisements per se, but rather the excessive number of commercials and subject matter that is dull, indiscreet, or just plain awful. Viewers watch tasteful, clever, humorous, and above all, meaningful ads. For example, commercials used on "Hallmark Hall of Fame" are so subtle and thoroughly integrated that viewers very well may believe the ads are part of the program. The 2003 Super Bowl, the second-most-watched game in football history (137,600,000 tuned in at various times, with an average of 88,600,000 viewers throughout the game), presented upbeat spots such as the Pepsi Twist ad with pop stars Ozzy Osbourne and the Osmonds, FedEx with its "Castaway" spoof, and Visa with National Football League twin brothers Tiki and Ronde Barber at a flower shop. TiVo monitoring indicates that more viewers watched the best commercials than watched the game itself. Although the Reebok pitch fell low on the list of favorite ads, many people actually remembered it more than the highlights of the game. ABC's Academy Awards telecast, which drew 2003's second largest female audience, included effective spots that followed Academy restrictions and maintained a sense of class and elegance. The tradition is for advertisers to show new ads, and for producers of commercials to try to outdo each other.

DVR companies and advertisers are working together to design expressly for the internet and TiVo's systems. For example, BMW has produced several short films attracting the attention of viewers and other businesses. One such series involved the talents of director Ridley Scott and actor Gary Oldman. Another short BMW film directed by John Woo and starring British film idol Clive Owen included one of the most exciting car chases in memory. BMW promoted the short films on its own "advertainment" site, BMWFilms.com, from which TiVo downloaded for its systems. The films also have appeared on several popular TV programs.