NONE: Re: ONLINE-ADS>> Peter Bull's fanciful "ad piracy" hypothetical
Re: ONLINE-ADS>> Peter Bull's fanciful "ad piracy" hypothetical
Bob Schmidt (schmidt_at_magicnet.net)
Tue, 02 Dec 1997 01:58:10 -0500
Peter Bull writes,
>On the other hand, an ISP who has detailed knowledge of all the subscribers
>in a local area and who can guarantee access to those subscribers every
>time they log on, and can prove that the advertisements they have been paid
>to display have actually been displayed, to those users and to no others,
>and for measured and reported amounts of time, has a very convincing story
>to tell.
Apart from the numerous copyright issues, it should be noted that this is,
in fact, not a new idea. It has already been proposed by IDEA, a West
Virgina organization which sought to become a trade group for ISPs and last
year propsed exactly such an advertising idea.
Quite frankly, the idea that ads should be married with content by the
local delivery agent who sends it to the consumer is only applicable to
some ad media (broadcast), and even then is not wholly the case (network
ads being the obvious exception). So the idea that it is somehow natural
that the local delivery agent be the packager of ad media, or the idea that
this take place to the exclusion of the origination side, is not compelling
in the least.
There are a few flaws in the mechanics of the concept, the main one being
that evidently, if IDEA's experience is representative, ISPs have zero
interest in it. This will come as no surprise whatsoever to anyone familiar
with ISPs. With a few notable exceptions, they are, generally speaking,
techheads, not business people and they are as far from being marketers, or
exploiters of capital and resources, as one could possibly imagine. The
idea that ISPs really know their market from their own business perspective
is also questionable, never mind the idea that they know their market from
the perspective of other businesses. In fact, the idea that the typical ISP
is a suitable entity to operate any type of ad medium is, unfortunately,
almost incomprehensible, so devoid are they of any understanding of
advertising.
Not to mention that any behavior on the part of ISPs that is not synonymous
with common carrier standards sets the stage for rights in conflict, namely
the right of Internet users to do with their bandwidth as they choose, not
as the ISP chooses. The typcial ISP thinks he owns the bandwidth which he
purchases from an upstream provider. Why that should be so, when the ISP is
nothing but a reseller, has never been explained, but it is a perilous
assumption that will sooner or later come crashing down on the ISP's head.
As I have stated elsewhere on the subject of ISPs blocking wholesale the
domains of certain emailers, the formation of info-cartels and info-cabals
when ISPs gang up to arbitrarily create favored and unfavored classes of
emailers, the ISP is the Hero of the Internet, but he is not King. The
Customer/User is King. And the user's right to the use of bandwidth is
greater than the ISP's.
Assuming one can get beyond those issues, the next question becomes will
enough users view the price/value of ad supported free access to be
willingly exposed to it? Just because it's free doesn't mean users will
flock to it. One has only to check the circulation of any free weekly
against the paid circulation of the daily newspaper to see that this is
true. The elasticity of demand may be far greater on the ad side than the
subscription side, especially for the reasonable cost of ISP service.
An unstated assumption appears to be that a user will have only one ISP,
and will thus be a captive market, a dangerous assumption if one looks to
ad supported email as an example where a proliferation of email addresses
is the result. While, no doubt, an argument could be made that email is
different, nevertheless, it can also be argued that if something is free
there is no reason not to sign up for it, even though there may be no
compelling reason to actually use it once one is signed up. The churn
rate, already too high at most ISPs, would quickly become the overriding
criterion for success.
The other business reality will be who will sell the ads? If it's up to the
ISP to do it, forget it, it'll never happen. <g>
However, these probelms aside, as a practial matter, should the rough edges
of Peter's concept be worked out and the idea adopted by enough ISPs (and
users) to achieve, say at least 10-20% penetration of a given market, the
online ad community would certainly try it out to see if it works. Thus, it
would seem that a far more crucial venue for discussion and seeking support
right now would be within the ISP community than here. But I hope Peter
will keep us posted on his progress and let us have the first crack at
booking space when the time comes. <g>
Bob Schmidt
www.provider.com
Author of The Geek's Guide to Internet Business Success
The Definitive Business Blueprint for Internet Designers, Developers,
Programmers, Marketers, Consultants and Service Providers
http://provider.com/geeksguide/
ISBN 0-442-02557-2
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