TiVo: The New Television Ratings Service?

Back on June 2, TiVo announced a new service that can measure ad-skippage. Since television advertising began, the primary metric for determining where to advertise and how much to charge has been viewership: Based on surveys, how many people watch the show. Or at least claim they do.

Now TiVo can measure What really matters to advertisers. Advertisers really don't care who watches the show but who watches their ad. Unfortunately, to date, advertisers have had to extrapolate from data showing who watches they show and assume that their ad is also being watched as well.

Some of the latest findings out a big whole in that line of thinking and it's going to be a big scare for those in the ad business.

For one, a program's rating -- the number of people saying they watched a TV show at a given time -- appears to have an inverse relationship with the proportion of ads viewed. On April 11, 2002, ABC's popular TV drama The Practice drew a TiVo rating of 8.9, meaning 8.9% of TiVo owners watched the show live or recorded it and watched it later. But those viewers watched just 30% of the ads shown. Meanwhile, quiz show The Weakest Link, drew a rating of 0.9, but viewers watched 78% of the commercials. TV news magazine 60 Minutes got only a 2.2 rating, but its viewers sat through 73% of the ads.

So why pay a premium price for a television show where it can be proven that only 30% will watch your ad?
--------