On the heels of its new online distribution plans, NBC intends to offer its prime-time content on Cox’s video-on-demand service as well, starting this week.
The VOD service will temporarily disable consumers’ ability to skip ads under the new deal.
In addition, Cox said it has begun installing the technology in its Orange County, Calif., system that will let the operator insert fresh ads on the fly into VOD programming. When that launches in January, it will be among the first times a major operator can do this on an ongoing basis.
When the NBC deal kicks off this week, Cox’s 200,000 digital customers in Orange County will be able to watch “30 Rock,” “Friday Night Lights,” “Las Vegas,” “Life” and “Bionic Woman” on VOD.
The shows will be available one day after their broadcast premiere in the “MyPrimetime” category. That’s the same area where Cox offers ABC’s prime-time shows on VOD. ABC and Cox struck a similar deal in May, also with fast-forward disabled during ads.
NBC said it wants to learn how consumers respond to having fast-forward disabled, said Bradley Fleisher, senior VP for NBC Universal TV networks distribution. In a recent study by VOD research firm Marquest Media & Entertainment Research, 36 percent of consumers said they would watch a show even if fast-forward was disabled, while 37 percent said they would not.
NBC’s trial with Cox follows its announcement last week that it would start a broadband-based download service in October to let consumers watch NBC shows for up to a week after they air. NBC is aiming for some of the Apple iTunes business it lost when the two media companies failed to come to terms over pricing, leading to Apple pulling NBC’s shows from iTunes earlier this month. NBC subsequently struck a deal with Amazon Unbox.
As for Cox, the cable operator will let consumers fast-forward ads once the dynamic ad insertion technology from SeaChange is ready to go in January.
“It’s my personal belief that over time viewers just won’t tolerate 15 minutes of ads over the whole show,” said David Porter, VP of marketing and new media at Cox Media.
Under the ABC deal, Cox will begin dynamically inserting ads as soon as the technology is installed, ABC said. Mr. Porter said Cox is still talking to NBC about ad insertion.
While a few cable operators have tested dynamic ad insertion, Cox likely will be the first to roll it out in a big way. Mr. Porter said Cox will launch the capability in an additional three to four systems next year.
The ability to insert ads into broadcast content is likely to open VOD to a new class of advertisers, such as retail stores and restaurants, which need to change ad copy quickly to reflect special events and prices.
“The ‘baked-in’ nature of VOD ad inserts has been cited often as a key barrier to developing VOD as an advertising medium at both the national and local system level,” said Paul Rule, president of Marquest.