When select MasterChef Junior episodes air on the Fox website this season viewers will have the option to skip nearly 10 minutes of commercials by watching one long-form ad prior to the show. Between August 19 and September 13 viewers can choose to watch one 60-second ad from the California Milk Advisory Board, followed by the full episode without ads.
The experiment is part of a mission by Fox’s new chief executive James Murdoch (son of FOX founder Rupert Murdoch) to balance ad income and changing viewing habits. As reported in the Wall Street Journal James Murdoch’s background is in digital media and advertising, and last year he brokered the purchase of digital ad company TrueX, the company overseeing the rollout of the milk campaign. TrueX focuses on “engagement advertising”, which requires the viewer to make choice of which ad to view, or to interact for the ad to complete. The model has been used on Hulu, which is partially owned by Fox, for several years. According to one WSJ reporter, “Mr. Murdoch frequently takes meetings with young ad tech firms as he ‘furiously learns about the ad tech business,’ said a person close to him.”
Research by TrueX shows that thirty-two percent of online viewers use ad blockers to avoid ads. Reported in AdWeek, when given the choice to choose one interactive ad or watch a series of pre-selected ads, sixty percent of viewers chose what to watch. Of that group more than eighty percent chose the shorter, interactive option.
At this year’s TV upfronts – the week when networks present their upcoming shows to advertisers for upfront purchases of advertising time – Variety tracked an overall decline in ad revenue for nearly every major network, a trend over the past three years. If the decline continues, next year ad dollars could drop below $8 billion for the first time since 2009, during the national recession. Upfronts are simply one way that advertisers purchase television time however, so the figures don’t mean companies are avoiding TV ads altogether but rather looking for new strategies to get their content in front of more viewers.
Though TV ads have never been particularly popular, Internet viewers seem even less tolerant of them, partially because they are inescapable. They cannot be skipped over or forwarded through in the manner that DVRs allow with shows recorded off broadcast TV and cable. Though shows streamed over the Internet often have about half the total ad time as broadcast episodes, Internet forums for online viewers show that most people perceive there to be just as much advertising. Frustration increases when viewers are paying for a service, like Hulu Plus, yet are still forced to watch ads. Hulu addresses the issue on their Help Center page by stating “We have found that by including a modest commercial load, we can keep the price for Hulu subscribers under eight bucks, while still providing users with access to stellar shows on the devices of their choice.”