The end of advertising

[Commentary] Disney, which owns ABC, made a deal with Dish Network, the satellite provider that, for the first time, will formally allow the use of technology to let viewers skip ads on ABC shows.

The fig leaf compromise here is that Dish, which will now stream ABC shows over the Web, will have to wait three days after first broadcast before letting its ad-skipper, AutoHop, go to work. But it's a big breach in an up-to-now implacable network wall. Finally, a major network has bent to the obvious -- people expect to be able to skip ads. American media, marketers and culture move inextricably closer to a world in which video is wholly unhooked from advertising. Television advertising as it continues to exist -- lucratively so -- has often seemed like some odd form of protectionism, forcing the consumer to endure something that the simplest technology makes obsolete, and as a kind of emperor's new clothes conceit: Who beyond the comatose actually watches ads, anyway?

But what happens when there is no television advertising of any kind? What happens when even the most unassertive can easily skip even network television ads? Clearly, live-event programming, from the Oscars to sports, wherein real-time pauses can be naturally filled with ads, becomes ever-more sought after.

The media have been slowly converting themselves into a subscription and licensing business -- learning to live with lower margins. Even networks now get fees from cable companies. ABC's Dish deal undermines ad dollars, but replaces them with licensing dollars, however fewer. Brands, on the other hand, while they been moving consumer ad dollars into other forms of marketing, ultimately face a bigger crisis than television producers.

Digital media, a hoped-for alternative, have woefully failed to become a method of brand identification. Sponsored content offers much less of a return than being a television sponsor. Nothing, so far, has replaced, or even suggests it might someday be able to replace, the powerful nexus of video, a passive audience and advertising in the creation of consumer desire and, indeed, in the character of modern man.

[March 10]