Dish Chairman Hopes Auto Hop Will Lead to ‘More Meaningful’ Ads

Charlie Ergen tells the Wall Street Journal networks need to evolve

Dish Network chairman Charlie Ergen said he hopes his company's commercial skipping "Auto Hop" feature will spur networks to air "more meaningful" ads that viewers will actually want to watch.

In a rare interview, the Dish co-founder and former professional gambler told the Wall Street Journal that "broadcasters and advertisers have to change the way they do business or they run the risk of linear TV becoming obsolete." The changes might include more specific targeting of ads.

Also read: Dish Customers Lose 14 Channels in 6 States, Company Says

ABC, CBS, Fox and NBC sued Dish over Auto Hop last month, on the same day that Dish sued the networks. Network executives have complained that the feature, which enables viewers to watch previously aired shows with no ads, is a threat to ad-supported television. Dish has contended that it only takes fast forwarding further.

Dish, the country's third largest pay-TV distributor with about 14 million subscribers, has feuded with networks for years over the amount it pays in retransmission fees to air their content. Ergen seemed to suggest in the interview that Auto Hop gives Dish more leverage in those disagreements, the Journal noted.

"If the ad is skipped, the consumer likes it, but it's not necessarily good for me and it's not necessarily good for the broadcaster because I'm in the same ecosystem as him," Ergen said. "So we have to figure out how the broadcaster benefits, we benefit and the consumer continues to feel like he gets a fair deal. So maybe [the consumer] pays a little bit less for 'retrans,' his bill doesn't go up by double digits every year…. That's an interesting conversation to have."

On Wednesday, Dish said Dallas-based Hoak Media pulled 14 stations in six states from its service in a dispute over fees and Auto Hop.

Dish has also said it will stop airing AMC networks this month because they are too expensive and don't generate enough ratings. AMC disputes that, saying Dish is retaliating because AMC won an early ruling in an unrelated lawsuit between them.