Monday, December 11, 2006

Microsoft DVR based targeted advertising

The digital video recorder, popularized by ReplayTV and TiVo, gave consumers control over television advertising. Now Microsoft is mulling how to put advertisers back in the picture.

In a patent application filed on Thursday that seems as sensible as a perforated umbrella, Microsoft describes a system for DVR-based targeted advertising.

The filing accurately describes some of the problems with TV advertising today, noting that DVR use may delay time-sensitive ads and that ads targeted on the basis of television content or geographic region often reach "viewers that are not interested in the goods and/or services being advertised."

Thus, patent application concludes, "content providers and advertisers both have an incentive to implement better technique(s) to target and deliver advertising messages to specific viewers."

The system Microsoft describes involves a DVR, an advertising data store, and software to manage ad presentation. The ad management software tracks the start and end points of ad placeholders during content playback and serves ads based on targeting criteria. It serves "a targeted advertisement when the recorded data stream or an associated content navigable stream is played back at any speed in a forward or reverse direction, such as fast-forward, rewind, skip-ahead, and skip-back."

The system may serve different ads at different times, if appropriate.

Notably absent from Microsoft's assessment of the appeal of ad-targeting technology is any mention of the fact that an increasing number of consumers use DVRs expressly to avoid commercials. That's a message advertisers might not want to hear, but as a recent report from Forrester Research pointed out, 15% of consumers say they use their DVR to skip ads, more than three times as many as in 2004.

Given the firm's prediction that more than half of all U.S. households will have DVRs by 2010, Microsoft might be better advised to patent ad blocking technology.

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