Archive for the 'advertising' Category

Why the Ad-Revenue Model is Doomed

August 31, 2006

My head is spinning. So yesterday, Per wrote about Universal Music’s decision to allow free downloads to folks who agree to watch ads. It’s kind of a radical move for a giant music conglomerate, but plenty of other industries are already on the bandwagon. You can read an ad-free version of if you pony up for the annual fee. You can pay extra for TiVO to watch ad-free TV. Ryanair, the nutso European airline, announced recently that someday, flights will be free—if you agree to watch lots of ads on the seatback screens.

It’s becoming obvious that soon, we will be divided into a society of those who watch ads and those who can afford not to. The poor and lower middle class will live rent-free in their ad-plastered homes, get free clothing plastered with insignias, and eat free burgers and cheese sticks tattooed with brand logos. The rich will live an ad-free lifestyle; an absence of ads in one’s surroundings will become a mark of prestige.

But HAHA! How will companies sell anything with their ads if the ads all target folks who never have to buy anything because they get it all free by watching the ads? Maybe it’s too early in the morning for me to be blogging, but really. I think corporate America needs to do a little re-thinking on this one.