Lots of companies are drooling over the prospect of earning gobs of money from mobile video, using a variety of business models — many of them built on incrementally charging people for the content, whether by clip or by channel. This doesn’t seem likely to work, since it’s at odds with the typical TV model, which offers free content, or people are charged for access to a wide array of channels and content. MocoNews points to an article in Mobile Insider that argues this same point, and says that making mobile video free and supporting it with ads is the best way forward.
The original piece quotes an exec from Rhythm New Media, which serves ads for 3′s video content in the UK, and he claims that they’re getting CPMs that average five times TV and 2.5 times the internet, which sounds great. But the justification for those high CPMs is a little sketchy:
Frequency capping is another strength of mobile, he argues, because TV buys tend to carpet-bomb viewers for effectiveness, and as mobile presents a total share of voice in an uncluttered environment where people are actively looking for video. And of course, there is no DVR-effect on mobile. You can’t fast-forward past an ad, and unlike the Web, there is no room to do what I usually do during pre-rolls, click away to another open window or do an email check until the pitch is over.
TV networks have tried to figure out ways to circumvent the DVR effect and force people to watch ads, but that seems a bit foolish. Obviously people don’t enjoy the ads and don’t want to see them. Perhaps the better way forward would be to change the ads, and make them more compelling and enjoyable (by realizing they’re content in their own right), instead of not changing them and trying to force people to sit through them.
So it sounds like mobile is great from a video advertiser’s perspective, because users have no sort of escape from the advertising, it’s completely interruptive, and they’ve got no way to avoid it. Basically, this scenario lets them further procrastinate at changing what they do and making it better and more effective (since, gosh, that would take a lot of effort), and instead extend a dying ad mechanism just a little bit further.
That sort of attitude is hardly encouraging, is it?
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