CBS CEO Leslie Moonves said he believes Dish’s new Auto Hop feature, which allows viewers to skip spots when they watch DVR’ed shows, is illegal.
“They can’t put our content on without commercials,” he said in a brief interview with The Wrap at the CW’s upfront presentation to advertisers. “They just can’t do it. It’s illegal.”
Asked if the situation could lead to a lawsuit, he responded, “I don’t know. I hope it doesn’t come to that, but you never know.”
He said CBS continues to discuss what to do next.
Dish contends that Auto Hop merely advances past technology allowing viewers to record shows and fast forward through ads.
Asked if Dish could perhaps offset networks’ lost ad revenue from Auto Hop by charging Dish more to run their programs, Moonves answered, “I don’t know how you’d ever upset the apple cart like that…I think Ted Harbert said it very accurately. That’s the ecosystem that we live in, you can’t suddenly change that. How am I going to produce ‘CSI’ for $4 million without ads? I can’t do that. I can’t give the audience that kind of quality.”
Auto Hop bypasses ads from recorded shows on NBC, Fox, ABC and CBS, but not cable nets. During the NBC’s upfront presentation 5/14 at Radio City Music Hall, NBC Broadcasting Chairman Ted Harbert told the audience that Dish’s new DVR commercial zapping device is an insult to all the money NBC and its parent, Comcast spend on sports and entertainment programming: “Just because technology gives you the ability to do something, does that mean you should? Not always…I think this is an attack on our ecosystem.”
“It seems a strange thing to do,” said Peter Rice, chairman of entertainment for the Fox Networks Group. Rice, while announcing Fox’s fall schedule 5/14, noted that broadcast networks such as Fox are the largest content providers to pay-TV distributors such as Dish, and wondered why they’d risk alienating that relationship. As for whether the network will consider legal action to try to derail Auto Hop, Rice said Fox is “still evaluating it.”
RBR-TVBR observation: At this point, attorneys from the networks are looking to see if they have a case. If so, Dish may end up with a class action suit from the networks. It’s unfair to block ads on broadcast networks and not cable. It lowers the value of the broadcast network ads vs. the cable network ads. Second, when the networks signed agreements with Dish to carry their feed, Auto Hop was not in the picture. Breach of contract? That’s what may be determined. A lot of viewers don’t bother with trying to fast-forward DVR ads because they inevitably go too far and skip part of the programming. Auto Hop will allow everyone to sit back and let it do the work for them—flawlessly. This will take the percentage of people putting up with spots in DVR programming to near zero.
