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by Mintz 6195 days ago
Am I the only going, "duh?" It was only a matter of time. I can things of a few reasons why web ads are more expensive:

1. People actually watch the web ads. They're only 15-30 seconds, so you don't have time to get up, use the bathroom, grab a drink, etc. It's a trivial amount of time that provides little opportunity to do anything else.

2. How many people watch the ads is more statistically trackable on the web. Who knows how many people are watching the Simpsons when it comes on? Someone could have just left the cable box on, someone might watch it through an antenna, a bunch of people could be watching it from the couch or one guy could be on the couch. How many people watched this show on Hulu? Well, we had 34,746 streams within the past week, and an overwhelming majority of them are probably one person at a computer.

3. You can decide if you like or dislike the ad. Ad companies can now be sure that they're not wasting money advertising Viagra to a teenager.

4. Hulu is insanely popular. It's one of the top-trafficked streaming websites last time I checked TechCrunch. People actually WANT to watch the show they're looking for, which, when joined with point #3, means the ads are even MORE tailored to the consumer. Convincing you to buy something you're already kinda interested in is way easier than selling ketchup popsicles to a woman in white gloves.

Summary: Web TV is finally getting the attention it has always deserved (since broadband became feasible for the majority of America, anyway).

2 comments

It's definitely obvious - I agree. It's only a matter of time before this model becomes prevalent. The next milestone is for Hulu to reach critical mass. The networks still make much more money with cheap, high-volume ads from the millions of TV watchers in the U.S. that haven't switched yet.
An important step would be moving outside of the American market.

Currently, major content producers sign deals with local TV stations in non-USA areas of the world. There is no reason Hulu can't stream to other areas, so at some point it may become easier or cheaper for Hulu to operate in a region instead of the local TV station?

They can also target the ads more precisely. Like it or not, there's a lot of data on a lot of people out there that exists solely for doing things like that. All broadcast TV has is context.