The networks have gotten support from cable companies over Dish Network’s ad-killing device called the “Hopper”. Dish is promoting the device to its consumers as the best way to get rid of ads while watching primetime network programming.
But Discovery Communications CEO David Zaslav says that Dish could end up disrupting the well-balanced industry in a negative manner. Zaslav says that if Dish, whom he called a content distributor, does not let advertising through its system, the end result could be higher subscriber fees for the consumer. He pointed out that Discovery had spent over $100 million more on creating new content for this year than it did last year, and without ad support the company will not be able to support such ventures.
The Hopper DVR only works on the networks right now, but both networks and cable companies are feeling threatened. Glenn Britt, CEO of Time Warner Cable, has even said that the technology could destroy the business that his firm and other companies have spent over 40 years building. Britt defended the present system, saying that it benefited both industry and consumers and echoced Zaslav’s warning about consumers ending up with a higher bill if advertisers are not allowed to get through. Britt said that since the average American household watches 400 hours of TV every month and pays around $75 a month as his cable bill, this was a great bargain for the American consumer.
The only note of support came from AOL CEO Time Armstrong who said that the industry would have to come up with more creative ways to reach to the consumers whom he called “super-engaged”.
Dish Network is the second largest satellite TV provider in the country with 14 million subscribers.
Dish Network’s Ad-Killer Device Could Harm Consumers Say Networks and Cable Companies by Harrison Barnes