I have always been an Apple fan, until the recent release of the iTunes Radio. It is a music discovery service that lets you listen to music of your flavor. For free—well sort of.
The only problem is that, there are way too many ads during the playback. On an average there is one fifteen-second ad per two songs. That is way more than Spotify, Pandora, TuneIn Radio, Stitcher, etc.
And that is way too much. Why?
The difference between text ads and video/audio ads
Ads have a long history, long before newspapers were invented. Ever since the old days, people have been trained to be really efficient to skip useless advertising information during their reading. Even in the Internet age where text ads are everywhere, people are comfortably living with them.
The key factor, as I argue, is the human minds’ capability of processing information in a parallel fashion. When you visually see a page in the newspaper or online, this piece of visual information is almost automatically pre-processed so that the useful and useless information are separated—not based on the content, but on the format.
It is very different for the case of video/audio ads. The human minds are not being fed with the information in parallel, not to mention processing them together.
Due to this, the value of a piece of video/audio ad should be different from that of text ads, and the value should be re-evaluated with careful market research.
Without seeing such research result, I’d prefer to estimate the value based on a similar reasoning as for opportunity cost. The value of a useless ad is roughly equal to the value of your salary for the time that you spend in processing the ad.
With this estimation, the values of text ads and video/audio ads should be very clear. A normal text ad on a webpage should take no more than a fraction of a second to process, whereas an ad viewer would spend exactly the same amount of time for the whole length of the video/audio ads (with the exception on YouTube that you can manually click a skip button).
Assuming you have an hourly salary of $60, then a 15-, 30-, or 60-second video/audio ad would value ¢25, ¢50, or a whole dollar, respectively. Of course this estimate assumes that you are viewing/listening to the ad without actually working for the salaries, which is technically not true. Anyway, comparing this with the text ads, which are usually sold in huge bulks due to their limited individual values, the profit for the advertisers would be significantly more should the same percentage of video/audio ads be placed.
In other words, from the users’ perspective, the quality of service for video/audio ads should be significantly better than that of text ads, since you are essentially paying much more hidden service fees (by converting your time to money).
What can you do?
Currently I do not think the situation will change for the better. However, if you are an ad-hater as I am, here is a list of things to reduce the amount of irrelevant ads from your life.
- TV ads. Depending on what programs you watch, you may not need TV at all. Unless you’d like to watch a ton of ads with short clips of your favorite sitcom interspersed in between, and you want to watch this at the time the show is aired, you can always choose to subscribe to Netflix, or watch them online the day after the air. It is also much cheaper than the cable.
- Webpage ads. The adblock plugin (note: not the adblock plus) is highly recommended. It is available for both Safari and Chrome. A majority of ads can be filtered out. The world of internet is just as clean as centuries ago.
- YouTube ads. The blocking of YouTube ads by the adblock plugin for Safari does not always work. But it works for Chrome. Also, ads from some other video sites, e.g., CBS, can be blocked too.
- iTunes Radio ads. An option is to purchase the iTunes Match program for $25 a year. There does not seem to be other options since Eddy Cue really thinks this is the next revenue source for Apple.
- Ads in other music streaming/radio services. Spotify, Pandora, TuneIn Radio and Stitcher come with similar subscription services to become ad-free.