How VOD will change the TV industry (p. 258, #1)

The text points out (p. 252) that “numbers in the rating books are the basis for spending vast amounts of money, it is important that they be as accurate and reliable as possible.”
Much of it is determined on the amount of spending by advertisers, thus, the need for ratings. Since TV's introduction to the mass market in the early 1950s, the technology has evolved. Watching TV has historically been a "lean-back," shared experience. That is, we sit six to 10 feet away from the set, and often watch it with others. TV has evolved from color TV and remotes in the 1960s; the expansion of cable and VCRs and videogames in the '80s. Then a major shift to digital satellite TV in the mid '90s; DVD players and digital cable in the late '90s; HDTV, DVRs, and VOD in the early '00s. Television is a place where individuals go to clear their minds and be passive; though they may flip channels to avoid commercials, studies have shown that people would rather put the remote down. However, the increase of channels and the options of watching DVDs and other media have raised the bar; now, there is really no reason to sit and watch programming you would otherwise not. VOD isn’t widely used as the text points out, but that could change as the industry makes the use less cumbersome and less expensive.

VOD will change the TV industry in many ways. Viewers can program and view at their convenience. There won’t be a need to be home at a certain time to watch their favorite programming. There is the luxury of family members programming their favorite show, and watching it together or separate. (There is a downside to this in that the potential of fewer families sitting down together to watch TV.) With the ability to skip through advertising, marketers are having to come up with new ideas on how to reach targeted audiences, and determine where (and on which market) to spend their revenue. They will have to learn how to integrate their marketing in a new way. Without the aspect of “forced” ad viewing, marketers will have to adapt to the change. They will also have to accept the fact the audiences are more fragmented than ever before, as viewers are more in control. This could be in the form of sponsoring shows ad-free. I think that if VOD can deliver rich content with excellent service levels and absolute reliability whenever the customer wants it, the consumer will become increasingly reliant on VOD. It does depend on the offerings of the provider. This will require (on the provider’s part) the ability to ensure video quality and access to vast libraries of programming.

As the text points out, the downfall to VOD is the lack of tracking mechanisms in place to monitor consumer viewing. Nielsen ratings do not include VOD consumers to date. At this point, Nielsen is working on technology to capture what is viewed on the screen even if it is time-shifted and place-shifted viewing. As VOD becomes more widely accepted, and corporations, marketers, and advertisers become increasingly aware of changing TV trends and viewing, I believe will begin to see TV in a whole new box. Pun intended! I like the idea of being able to view TV as I wish. With or without ads, being able to pause and coming back to it later. Very innovative.