RealTime IT News

Where Commercials Go to Die

Next in tech Internetnews.com editors provide an early roadmap for tech's direction in 2007.

People hate TV commercials.

Sure, there are exceptions. A good Super Bowl ad may get a laugh upon first viewing. But even Bob Dole ogling Britney Spears can turn into a piercing amalgam of light, noise and heavy-handed product pushing the second or third time around.

For some time now, technologies have been evolving to help people avoid them. There was cable with its subscription-supported programming, such as HBO. Then there was TiVo and its DVR (digital video recorder) competitors that allow viewers to record their favorite shows and fast-forward through the commercials when they watch later. And there is on-demand television.

Now, there is Internet video and YouTube, commercial-free but for the banners on its margins, leading the way.

Only, here's the problem: commercials pay for TV.

Looking forward to 2007, there are some questions to consider. If technology continues to help people avoid commercials, who will pay for television TV -- let's call it video content -- production? If the answer is advertisers, as it has been for the last 60 years, how exactly are they going to get anybody to watch their ads?

The continued existence of several companies depends on their ability to answer such questions. Gotuit Media is one such company, which has investments in video for mobile devices, on-demand cable and video search.

Gotuit President Mark Pascarella told internetnews.com his company's "billion dollar opportunity" is video search.

It could be an interesting idea because search can be applied to all three video content platforms of the future: mobile, PC and DVR. But is video search the answer? Can it monetize video content in 2007 and beyond?

Gotuit's plan is to display keyword-based, pay-per-click video advertisements next to their video search results. It's like Google, Pascarella said.

But analysts will tell you Google searchers click on advertisements because they are relevant to their searches. There is an incentive for users to click on the advertisements because they are links to vendors selling the products the users are already searching for. They're useful.

Some of the most popular searches on Gotuit.com are for the terms "Lindsay Lohan" and "Tara Conner." Think anybody's looking at those videos in a research or buying mode?

If not then why would a searcher choose to watch a TV commercial just because its attached to their search term? Where's the incentive, and how is that useful?

Pascarella admitted that most searchers probably won't want to watch the ads. But he argued that those searchers who do want to watch the ads are far more valuable to those advertisers anyway.

His theory is that advertisers wouldn't show their advertisements to those who don't want to see them. If you're not one to want to see a Chevy truck ad, you're not likely to be one who would buy a Chevy truck. So Chevy might as well not spend ad money on you.

In the end, Pascarella said, not as many people will watch a Chevy ad published on Gotuit as they would if the ad were shown during a live NFL game. But Chevy would know that those who watched after searching on Gotuit were genuinely interested in their product.

But companies sometimes advertise to generate interest in their product where none was before. Brand advertisers want to take audiences and tell them who they are and what they want?

This is part of the reason About.com CEO Scott Meyer, whose site runs its share of ad-supported videos, said that the broadcast television model for video content production isn't broken yet.

He said TV is still a great place for brand advertisers to spend a lot of money on reaching massive audiences that don't know yet how badly they want a product.

And perhaps some in Meyer's massive audience will later conceive of themselves as those who would want the advertised products they had never heard of before.

But advertising-avoiding technologies grew more popular in 2006. And advertising that feels like a service turned Google into a $500 per-share company.

From now on, there will be those who decide to press the record button on their DVRs or flip open their laptops, thereby avoiding TV commercials.

People hate TV commercials, but they don't mind getting help finding what they want and paying for it.