The Vlogbrothers have had a lot to say on YouTube in the past few days about the relationship between advertising and content on the internet — the tricky ethical terrain, the financial needs of creators, and the fact that we all want this whole internet thing to stay free. I haven’t known what I wanted to say about this, until I watched Hank’s song today, and more specifically, the rant afterwards:
The American eyeball — more generally, the affluent eyeball, and yes, you are affluent if you have an internet connection fast enough to watch YouTube videos — is one of the most valuable commodities in existence on Earth right now.So valuable, in fact, that many amazing services can be offered, for free, in exchange for nothing more than those eyeballs. I don’t like advertisement. […] But the internet is built on the idea that this stuff should be free, so that’s problematic, because advertising is then the only model. And if you want YouTube to be free, and yet continue employing thousands of people, you’re gonna have to look at ads. But if you don’t want YouTube videos to be supported by ads, and you don’t want them to be free, then we should talk about that. If there’s a way to make an online company that doesn’t rely on users providing their psyche and their behavioral habits to be put into a collective commons that is then auctioned off literally to the highest bidder, then let’s have that conversation. (Emphasis mine)
For the most part, I’m okay with advertising. I feel conflicted about the fact that advertisers get to practice psychological manipulation on us, but I don’t mind getting to watch YouTube for free in exchange for occasionally being annoyed by having to click another button before I watch my video after waiting a whole five seconds. For a lot of people right now, it seems like the solution is just to feel conflicted. Some people (like, recently, Tom Milsom) decide to forsake advertising revenue altogether, but a lot of people choose to go with the ads, hope they do relatively minimal cultural damage, and try to create art that’s good enough that it’s worth passing ads to see it. I think we can do better than that, and I think we should — and there are three levels on which I would like to see change.
Individual creators’ control
Artists should have the right to decide what kind of ads they want on their content. I imagine an interface in which creators would be able to select particular ads to put on their content, specify categories to let through, specify particular categories to exclude, or just automatically take the highest-paying ads that they have access to. Advertisers, too, would have the option to make their ads available to everyone, or blacklist or whitelist particular users.
Institution-level ad curation
At an organization-level, websites that rely on artists to create the content that makes their site valuable should do some amount of broad filtration. The parameters by which they filter should be explicitly stated in an easy-to-understand format so content creators know what they can expect in terms of advertising.
The poster-child example for these first two levels is Project Wonderful, an ad company designed for artists by Ryan North of Dinosaur Comics. From their website’s about page: 
They use a mechanism called ‘infinite auction,’ where advertisers bid on how much they’re willing to pay for ad display time, and the highest bidder is automatically charged the lowest amount of money that will beat all the other bids. Advertisers are only ever charged for the time their ads spend up on the site, and creators get the most anyone’s willing to pay for their ad space at the moment. I don’t think that the Project Wonderful system could be directly transposed onto YouTube, but if they were to renovate their advertising system, this would be a good place to get inspiration.
Government-level advertising standards
This category is pretty self-explanatory: we need better legislation protecting us from misleading and exploitative ads. I wrote on Wednesday about the DSHEA, a bill passed in 1994 that makes it easier for companies to lie about the medicinal value of their products, and harder for the FDA to catch them doing it. Food and medicine aren’t the only areas where we’re not very well protected against false or misleading claims. This isn’t something that individual artists or companies can do anything about directly, but if we adopt more proactive control over what we advertise, we might be able to start breaking down this cultural assumption that ads are entirely good or entirely bad, opening the way for popular political support of legislation that helps to manage false advertising effectively.
Economic drawbacks
Of course, if all my suggestions are implemented, it will necessarily decrease ad revenue for creators and networks. The more selection creators have, the more the market gets divided and the more intelligently individual advertisers can direct their money. When networks and governments impose quality control, the effectiveness of manipulative and dishonest ads are severely crippled, so the ads that make their owners the most money, and therefore are worth spending the most money airing, aren’t legal anymore. As John Green explains in his video on ads, You ARE The Product,
Corporations actually have a really good idea of how advertisements affect your behavior. In fact, there are many thousands of people who are working full time to make sure that the ads you see are worth more than they cost. To put it succinctly, almost by definition, advertisers buy you for less than you’re worth.
I would argue, though, that the dip in revenue would be worth the gains, because in the long term, the more we, as a nation and as a world community, make our information standards, the more thoughtful and responsible we will become. People are at least in part a reflection of their media landscape, and a more intelligent media landscape means a more intelligent citizenry, a better-run country, and ultimately, a positive-sum world community that will increase value for everyone.
A lot of good thoughts in here. The way that YouTube sells advertising is a little weird, and very traditional. Google is best at providing ads without any people being involved at all. I put code on my site, advertisers pick keywords, and then Google takes a cut of what advertisers will pay.
YouTube, on the other hand, while serving some ads The Google Way mostly wants to sell ads the old fashioned way because there’s much more money to be made. An adsense- served ad generally nets like 20 times less revenue than an ad sold by sales people.
I have a lot of problems with advertising, but one of them that isn’t mentioned in the above article is that, on average, watching advertisements costs you more money than if you just paid for the content.
If it didn’t result in a level of spending significantly larger than the amount of money the advertisers paid, they wouldn’t pay it. So, in effect, you are paying more for the content / service than you should, and there are about 20 middle men taking a cut before the money gets to the people creating the value.
So, in reality, everyone would be better off if we just paid for these ad-supported services. HOWEVER! It’s generally such a tiny amount of money per use / view that it would be impossible to charge people at that level because 100% of it would be eaten up by the credit card transaction fees.
So…yeah…it’s a dramatic economic inefficiency, and I don’t like dramatic inefficiencies.
