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Disney gets tough on ad skipping

Walt Disney Co. (NYSE: DIS) is getting tired of explaining to advertisers why it has fewer viewers. One reason ad performance is dropping has nothing to do with the networks losing audience. It is a technology issue. Viewers with digital video recorders can skip the ads.

Disney has a way to claw some of the audience back. It can refuse programming licenses to cable systems for on-demand applications unless the ads run as they were placed in the shows. This philosophy is at the heart of a new deal with Cox Cable. Disney will license [subscription required] its ESPN and ABC networks to Cox, but the cable system must ensure that the cable customers see all of the markets' messages.

Rentrak, a research firm, estimates that cable on-demand orders have gone from under 200 million per quarter in 2004 to over 700 million in Q107. So, Disney has real leverage by threatening to hold back valuable content. According to The Wall Street Journal, "Media research firm Convergence Consulting predicts VOD revenue will total $1.6 billion this year, with the business growing to $3.9 billion by 2010."

The digital video recorder business had traditional broadcasters on the ropes. They could no longer guarantee their huge advertisers that their commercials would be seen. With the Cox deal, the networks are beginning to push the pendulum the other way.

Douglas A. McIntyre a partner at 24/7 Wall St.

High-tech competition needed now more than ever

After reading this rant over at InfoWorld, I could not help but write a post on the what this customer went through in the consumer broadband Internet arena recently. Why did I choose this to post on? Because the same thing happened to me, and with the same company. What company? Cox Communications. The problem? Almost exactly as this article author describes, except my issues happened in 2001, or over five years ago.

At that time, Cox bought a smaller provider of cable television/Internet services in the town I was living in at the time. I had measured my broadband choices carefully and had chosen another providers based on value for the money. When Cox bought the company, not only did prices go up after about 90 days, but the customer service and especially communications from the new Cox provider were, well, absolutely horrid.

Giving newly acquired customers less than a few weeks to change email addresses and re-configure a bunch of technical settings in their PCs with pretty lame assistance was just the start.

So, the lesson this author learned -- same lesson I did -- was that competition in all industries is the key component. If you don't like the way a company treats you, you have the choice to move to a different provider. Take many things into consideration here -- prices, service levels, responsiveness, professionalism and customer service. Make a fair and balanced decision on who to give your money to.

In 2006, I am lucky in that there are three broadband service providers in my area to choose from. My current main provider is a company I have been with for over five years now -- because the service is excellent, the price is right and the customer service is great. Need I say more? By the way, it's not Cox, and probably never will be.

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Last updated: May 26, 2012: 01:47 PM

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