tivo_logo_man-744939Writing in the New Yorker, Tim Wu argues that ad-avoidance will always be present but won’t necessarily be a disaster for media industries.

The individual benefits are obvious. But is avoiding ads responsible or sustainable? It makes the advertising industry nervous, and many in the content industry, joined by some academics, see ad-avoiders as content-killers. The argument is pretty simple: if you destroy the advertising revenue that content depends on, we’ll end up in a cultural wasteland, or, worse, a culture plagued by advertising that masquerades as content. But things are more complex than they may at first appear.

I was interested in who those academics were and I clicked on the link. Well, those “some academics” turn out to be Simon Anderson and myself.

This was interesting because our research actually did not argue that ad-avoidance would be content killers. Instead, we pointed out that broadcasters would react in various ways including increasing the volume of annoying ads, causing content to move more mass market and that, unlike the arguments put by Wu, there are real challenges in using subscriptions to substitute for advertising revenue (at least initially).

What appears to have happened is that Wu has just read the abstract without looking at our work. In particular, our main technical achievement was to show that ad-avoidance technologies may cause some losses for broadcasters but that any potential ‘death spiral’ would be arrested.

Wu was, of course, happy to cite when he thought we might be some sort of apologists for the content industry but when it came to thinking about the effects of ad-avoidance on advertising prices, he did not cite any academics. In particular, the scarcity point has been established here, here and here.

But hey why let quality get in the way of a good argument, right? The New Yorker has free content (like Wu’s post) that relies on advertising revenue and some academics believe that ad-avoidance will lead to a reduction in quality for such content.

One Response to Will ad-avoidance kill content?

  1. tim wu says:

    This is Tim Wu; yes I did read your paper, not the equations though. In retrospect, I think it is true that your argument is more complex than the simple content-killer argument, and perhaps it was a mistake to put it in that sentence. But I took your paper to suggest that there will be less high quality content, and to suggest that paid-models would be unlikely to succeed, both of which I tended to disagree with.

    “First, while AAT penetration diminishes incentives to invest in vertical quality, the type of programming may be altered as well. AAT penetration favors providing average quality program for a broader (or mass) market segment over developing high quality programming for a niche segment.”

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