Thursday, June 21, 2001

Real Internet Marketing TiVo embraced real Internet marketing by supporting the hacker community that likes to tinker with its product. Unfortunately, hackers have figured out how to take the digitally recorded programs out of the box and put them on disc drives, servers, and anywhere else digital bits can reside.

Why is this a problem for TiVo? Because it upsets the networks. If people have access to the programming any point, then what value is the network adding? Interestingly enough, the only value networks were really ever providing was to broadcast advertisers, who appreciated them aggregating audiences (which is why ad-supported TV content has been a successful business model). TiVo's ability to fast-forward through ads AND the fact that it destroyed the notion of "prime time" by allowing customers to see whatever they wanted, whenever they wanted, meant that that model was dead.

Fast forward to the future: advertisers will stop interrupting programs with ads and focus on product placement instead. They cease to care how people see their program and infact benefit from people copying it and passing it around. Networks will then have to focus on marketing. Why this future is a long way off: networks will fight it tooth and nail (being clueless, and being backed by an equally clueless legal system). And there is no bandwidth to send programs digitally coming any time soon.


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