Fox made headlines announcing several of its new series would be part of “Remote-Free TV”.  The experiment began with Fringe, featuring only 10 minutes of commercials, often minute long breaks, for an hour long show, rather than the average 20 minutes.  Silicon Alley Insider crunched the numbers and found the experiment seems to be a financial success. Nicholas Carlson writes:

Fox has only been able to charge a 40 percent to 50 percent premium on “Fringe” spots — about $343,000 according to an AdAge study.

Figure then that Fox makes $6.86 million off 10 minutes of 30-second ads — 20 ads — during each “Fringe” episode.

If, like it normally would, Fox showed 32 ads at a 45% markdown from that premium, Fringe would pull about $7.6 million per episode.

Jon Nesvig, president of sales for Fox Broadcasting, thinks with more time, Remote-Free TV ads can be sold for an even higher premium.  What’s uncertain is how Remote-Free TV affect ratings.  Fox premiered Dollhouse last Friday with Remote-Free TV with modest ratings (though Friday nights have notoriously low viewership).

What it does show is more money can be made showing fewer ads, maybe even to fewer people.  Fox realizes viewers hate commercials and are buying DVRs and time-shifting technology with the purpose of skipping their main source of revenue.  Instead of fighting viewers, Fox is providing customers what they want – more TV, less commercials.  This encourages viewers to watch the show without waiting and even sit through a few short commercial breaks (sometimes even with higher quality commercials).

Instead of guilting viewers to watch, using DRM, or just packing shows with more commercials to offset lower revenue from time-shifting, Fox is trying to attract customers with more value.