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DVR Use to Hit 50% in Two Years, Ad Skipping to Rise to 18%: DVR Inst.

The total number of ads being skipped via DVRs is currently only about 6%, but that number will rise to between 16% and 18% in two years, according to DVR Research Institute, a consulting firm based in California.

The number of households with DVRs stands at about a third of total TV households; that number will rise to 50% in 2011, the researcher says (via Media Life). The Leichtman Research Group believes, on the other hand, that DVR penetration won’t reach 50% until early 2012.

A refusal by the Supreme Court to hear a case about DVR technology earlier this week potentially paves the way for wider DVR adoption.

Most marketers - 83% - believe the increased adoption of DVRs will reduce the impact of TV advertising in coming years, while 77% of agency executives believe DVR use will be the greatest challenge the current ad model faces, according to a new report from the DVR Research Institute. By 2012, as many as one-third of ads will be skipped in prime-time drama series, which will be hit the hardest in terms of ad skipping, according to the report, Mediaweek writes.

Horizon Media indicates, in its 2009-10 upfront report, that ABC’s Lost and Grey’s Anatomy were two of the most time-shifted programs, following Fox’s American Idol. The ABC shows drew 3.3 million DVR viewers per week. Fox’s House also pulled 3.3 million time-shifted viewers, and 24 pulled nearly as many.

The increase in DVR usage and the ad skipping that goes along with it will have a negative effect on television CPMs, the DVR Institute predicts. This year’s upfront could be the last year that broadcast nets see price increases, says Tom Schultz, managing director at the firm. “You will see that CPMs will start to come down. They are on an upward slope now, but that will change,” he is quoted as saying.