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New ad zapper has TV networks worried about sales

Associated Press Modified: May 22, 2012 at 4:00 pm •  Published: May 22, 2012
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NEW YORK (AP) — The maker of a new DVR that lets consumers zap away broadcast TV commercials at the touch of a button suggested Tuesday that the networks are being short-sighted in opposing the technology.

The Dish Network, which has offered its new Auto Hop feature on new digital video recorders since March, said it believes that people who buy the machine are watching more network television than they had before. The Auto Hop automatically records every minute of prime-time programming on ABC, CBS, NBC and Fox and stores it for eight days.

"It's a win-win for both consumers and the networks," said Vivek Khemka, Dish Network vice president of product management.

That opinion is anecdotal, however. Dish officials say they don't yet have hard data to back up the contention that more of their customers are watching network shows because they are automatically stored on their DVR.

Network executives are angry about how Auto Hop allows viewers to eliminate commercials on the recorded shows through one button, no fast-forwarding required. It didn't help their moods that Dish, the satellite service with about 14 million customers in the U.S., was advertising the new feature on the week that networks were touting their new fall programming. The feature isn't available for cable network programming.

Dish said Fox and NBC have refused to allow its ads for the new DVR on their networks.

"Ads are key to our business, so we're not supportive of anything that doesn't support our advertisers," said Paul Lee, president of the ABC Television Group.

During a presentation to advertisers at Radio City Music Hall, Ted Harbert, chairman of NBC Broadcasting, called the Dish Network feature "an insult to our joint investment in programming."

In one respect, the issue is a rerun for TV networks. In 2001, they sued the maker of Replay TV, another DVR, to stop a similar feature. The feature wasn't included in the next model of DVR that Replay TV put out, and the company that made them filed for bankruptcy before the lawsuit could be resolved.

Kevin Reilly, Fox entertainment president, said it was surprising that Dish would make such a move against its largest content provider.

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