Quote:
Originally Posted by jeffk
This type of issue is puzzling to me. Broadcast TV makes money by selling ads. The amount they can charge for those ads is determined by the size of their audience. The audience is determined by the size of their viewing market and by the share of the market they reach through the popularity of their programming.
In theory, the more possible people they can reach the more they can charge for ads. Let's say (total speculation) that they can reach 10,000 broadcast viewers, 30,000 cable or satellite viewers, and another 5,000 internet viewers. ALL viewers get to see the ads, right? Shouldn't that allow them to increase their revenue stream by charging more for ads (to businesses) that reach more people? Why should they care how the ad is delivered to the viewer?
Is this just a problem because broadcast TV is greedily trying to pry extra bucks out of cable & internet providers?
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The problem with your "in theory" statement is that people don't watch the ads when the media can be delivered digitally. My wife and I never watch programs when they are broadcast anymore. Whether by DVR, NetFlix, etc, we hit fast forward as soon as the ads start. Many, many people are doing this now and the advertisers know it. So the theoretical ad revenue is not there, despite appearances.