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TiVo Study Finds Untapped Ad Revenue

San Jose, Calif. – TiVo said a recent study of subscriber viewing patterns has found up to $88 million in lost network ad revenue on 10 broadcast network shows, alone.

The study tracked time-shifted primetime TV viewing watched between four to seven days after a program’s live airing (Live+4 to Live+7), Tivo said.

Moving from a C3 to C7 rating could increase commercial ratings by more than 10 percent, the company said.

Tivo said the results “reveal large increases in commercial viewership that are not captured in the current C3 metric and for which TV networks are therefore currently not compensated.”

The analysis covered a wide range of networks and programs to reveal exact second-by-second program and commercial rating increases from five to 17 percent by extending the measurement window from four to seven days after broadcast.

In broadcast primetime, networks have the most to lose when utilizing the C3 ratings currency.

Looking specifically at the commercial rating for ABC’s “Modern Family,” TiVo Research saw an increase of 10.9 percent by adding viewership from four to seven days after the telecast aired.

Based on network television ad prices, as supplied to TiVo by SQAD for the project, 10.9 percent equates to a per-spot increase of $26,665.

Extrapolating to a single season, based on an average of 17 spots per episode and full season of 24 first-run programs, the popular family sitcom is missing out on an estimated $10.9 million in revenue per year.

“Our unique commercial audience data demonstrates the real opportunity costs created by the gaping holes in the current C3 ratings currency and how filling in the blanks can help inform negotiations in this year’s Upfront,” said Jonatha Steuer, Tivo’s chief research officer. “Commercial ratings based on second-by-second viewing data not measured by the ratings currency are the only way to capture user behavior in a DVR environment accurately, and therefore the only way to assess the potential value that could be unlocked by going deeper than the ratings currency.”

He continued: “There’s a notion among some in the industry that by simply gaming the blunt instrument of average-commercial-minute measurement the ratings currency provides, networks can gain back some of the advantage advertisers get from unmeasured viewership beyond the three-day window. The reality is that only an extended measurement approach that combines both precise measurement of media viewership and a comprehensive understanding of audience composition can enable networks and advertisers to evaluate what commercial ratings truly are over the course of a seven day viewing period.”

TiVo Research analyzed commercial viewership for the 2012 to 2013 broadcast season, between September 2012 and August 2013, limiting the analysis to first-run, primetime programs with the exclusion of all network promos and PSAs. The results were based on aggregated, anonymous, second-by-second audience measurement data from a sample of 350,000 anonymous households with the Emmy-award winning TiVo service.

Since this study was conducted based only on TiVo households, it provides only an upper-end benchmark of the maximum possible impact of DVR viewing.

Current DVR U.S. household penetration is approximately 50 percent.

The company said TiVo households tend to be active time-shifters and commercial skippers, “so actual impact is likely to be at least half of that shown and perhaps more.”