Television’s Advertising Addiction

Last week, my weekly column was “TV’s Detour” and I focused on the first of what I described as two shifts that appeared to be happening in the world of television. The shift I discussed last week was the trend away from the television set and towards other devices, though I concluded that that might have been more of a detour than a lasting move, hence my title. This week, I wanted to pick up on the second of the shifts which is the move away from traditional Pay TV providers, with a view to evaluating to what extent this too might be a temporary detour rather than a permanent change.

Disruption embraced

One of the fascinating things about pay TV providers has been that they have been slow to respond to disruption, but they have eventually responded to almost all the forms they’ve faced over time and ultimately embraced them, bringing the disruption in-house and somewhat neutralizing it in the process. The table below shows some examples:

TV embracing disruption

The left column shows some of the key characteristics of traditional pay TV, almost all of which have been vulnerable to disruption because they don’t fit with the viewer’s ideal vision of TV. As I see it, nirvana for the viewer is to be able to watch the content they want, when they want, on the device they want, pay for only what they use, while seeing as few ads as possible. Pay TV providers have, over time, seen almost all these needs met first by others – whether by TiVo and other DVRs, which allowed users to time-shift content, or by Netflix and Hulu, which provide access on a variety of devices, or by a variety of on-demand services, allowing users to watch the content they want when they want. However, pay TV providers now offer both DVRs and on-demand services of their own, they offer “TV everywhere” solutions for watching content on devices other than the TV, and some are even partnering with players like Netflix to make their services available through the set-top box. Not all of these embraced disruptions are as good as the ones they’re responding to, but many of them are good enough to have allowed the pay TV providers to have brought the disruption in-house and neutralized the threat, at least to some extent.

However, there’s one cell in that right column that remains stubbornly empty and it’s the one that relates to advertising. Despite all that cable companies and others have done to respond to and embrace the other forms of disruption they’ve faced, this is the one that remains stubbornly unchanged (at least for the better) and the continued embrace by both pay TV companies and many of their content providers on advertising as an important revenue source shares some of the characteristics of addiction.

Defining addiction

As with any word, you can find a million definitions online if you spend enough time looking, but I found a handful that are useful in outlining the characteristics of addiction I believe the television industry is beginning to display with regard to advertising. Here are four (I’ve highlighted in bold text the parts that I think are particularly relevant):

From Psychology Today:

“Addiction is a condition that results when a person ingests a substance (e.g., alcohol, cocaine, nicotine) or engages in an activity (e.g., gambling, sex, shopping) that can be pleasurable but the continued use/act of which becomes compulsive and interferes with ordinary life responsibilities, such as work, relationships, or health. Users may not be aware that their behavior is out of control and causing problems for themselves and others.”


“the state of being enslaved to a habit or practice or to something that is psychologically or physically habit-forming, as narcotics, to such an extent that its cessation causes severe trauma.”

From Wikipedia:

“Addiction is a state characterized by compulsive engagement in rewarding stimuli, despite adverse consequences… The two properties that characterize all addictive stimuli are that they are reinforcing (i.e., they increase the likelihood that a person will seek repeated exposure to them) and intrinsically rewarding (i.e., something perceived as being positive or desirable).”


From ASAM (American Society of Addiction Medicine):

“Addiction is characterized by inability to consistently abstain, impairment in behavioral control, craving, diminished recognition of significant problems with one’s behaviors and interpersonal relationships, and a dysfunctional emotional response. Like other chronic diseases, addiction often involves cycles of relapse and remission. Without treatment or engagement in recovery activities, addiction is progressive and can result in disability or premature death.”

A progressive problem

The US television advertising addiction is certainly a progressive problem, as that ASAM definition suggests. The Wikipedia article on television advertising states that:

In the 1960s a typical hour-long American show would run for 51 minutes excluding advertisements. Today, a similar program would only be 42 minutes long; a typical 30-minute block of time now includes 22 minutes of programming and eight minutes of advertisements…

As a foreigner moving to the US about 11 years ago, I was struck, even then, by the sheer volume of television advertising. Even now, when I (very rarely watch) linear TV on the rare occasions when I flip through the channels in a hotel room, I find it’s almost impossible to figure out which program is playing on any given channel because so many of them seem to be playing ads. The ad load on US networks has been rising steadily and, as a result, live television content is becoming less and less watchable. Small wonder then so many of us seek to avoid it and have found various solutions for doing so. By sticking with the model though, TV content and service providers are “causing problems for themselves and others” (as per the Psychology Today definition) – including both their viewers and their advertisers.

Adverse consequences

One of the defining characteristics of addiction, per the Wikipedia definition, is the act or substance to which the user is addicted to has adverse consequences. That is the case with the TV industry’s ad addiction. The irony is the adverse consequences are moving in two opposite directions at the same time. First, the TV industry has, over time, become increasingly obsessed with certain relatively narrow demographics — because these attract the highest ad spend at the cost of neglecting other audiences (something I alluded to in an earlier piece). However, that very demographic advertisers are so keen to target (typically 18-49 male and but often the younger end of that) is the very group most likely to be using the various disruptive solutions which solve the ad problem. As such, TV providers are focusing on stuffing even more advertising into their programming rather than reducing it, which risks simply accelerating the move away from traditional platforms and services and onto those where tracking viewership is much tougher.

Withdrawal symptoms

The big problem for the TV industry is advertising is an incredibly important source of revenue and, as such, it’s become habit forming, “to such an extent that its cessation causes severe trauma” to quote Simply moving away from advertising entirely over a short period of time seems implausible, given the high reliance on it for much of the industry. Affiliate and retransmission fees could have offered a potential way out for broadcast networks in particular as a potential replacement revenue source but instead, most companies seeing a rise in these fees have simply used them to pad their margins rather than start a transition away from ads, a move that makes perfect sense as part of a short term world view but much less sense over the long term. Meanwhile, HBO, Netflix, and others continue to demonstrate it’s perfectly possible to run a subscription video service with zero ad load very profitably, as long as the quality and quantity of the content available is sufficient. Hulu demonstrates that smaller ad loads are still more acceptable than those you’ll find in most live broadcasts and people will even pay, in some cases, to view this content instead.

A problem not unique to TV

Of course, TV is not the only industry heavily reliant on an ad-based business model – much of the Internet, relies heavily on it a well — but advertising entails compromises in any business. The content owners serve two masters and, as such, are at least as motivated to please advertisers as users, which can lead to privacy violations, feelings of creepiness as advertising becomes increasingly targeted (as it shortly will on TV and already is online), and increased ad load and ad-related technology foisted on consumers in the name of increasing revenue. The recent debate in Apple blogger circles about website advertising is symptomatic of this broader reliance on advertising as a business model.

However, TV has always made heavier use of advertising than almost any other media and advertising on TV has always been more invasive than in other media because it takes over the whole experience. If the second shift in television is to become a detour rather than a permanent change, all those involved in the traditional TV industry need to take a long look at the role of advertising, the (negative) role it plays, both in the customer experience and in the ecosystem itself, and determine how long they’re willing to put up with advertising in its current form. The risk, if they stick with it, is the one part of their model they’re unwilling to disrupt themselves becomes their undoing, as the eyeballs they so covet move to other platforms and services that don’t abuse them.

Published by

Jan Dawson

Jan Dawson is Founder and Chief Analyst at Jackdaw Research, a technology research and consulting firm focused on consumer technology. During his sixteen years as a technology analyst, Jan has covered everything from DSL to LTE, and from policy and regulation to smartphones and tablets. As such, he brings a unique perspective to the consumer technology space, pulling together insights on communications and content services, device hardware and software, and online services to provide big-picture market analysis and strategic advice to his clients. Jan has worked with many of the world’s largest operators, device and infrastructure vendors, online service providers and others to shape their strategies and help them understand the market. Prior to founding Jackdaw, Jan worked at Ovum for a number of years, most recently as Chief Telecoms Analyst, responsible for Ovum’s telecoms research agenda globally.

49 thoughts on “Television’s Advertising Addiction”

  1. There are WAY too many ads on shows! It leads to a feeling that somebody is being greedy and it’s maddening. I escape from them by going to Amazon where it’s more than worth the small charge to be free of ads.

  2. “TV providers are stuffing even more advertising into their programming, which risks simply accelerating the move away from traditional platforms.”

    I remember when Craigslist came along, the Washington Post raised the cost of a short classified ad from $100 to $200. Good move guys! That’s like if a bear is chasing you, your response is to slow down.

  3. Jan, a very interesting article. Two thoughts come to mind that if you care to comment would be welcomed.

    First, addiction as I have witnessed in my family requires the addict to hit “rock bottom” before they are capable of rebuilding their lives. What will this look like for TV? As many of the TV organizations have moved upstream to own internet and other distribution channels, they do not get the “signal” that are hitting rock bottom.

    Secondly, addicts are very clever at gaming others in the service of their addiction. For TV, this gaming has interesting implications in my mind in that they are all operating in regulated settings. There is some evidence that refu,actors over time become co-opted to servicing the regulated firms interests over the consumers’. In Canada, we have observed at how painfully slow and convoluted the regulatory process has become. In families this is about how friends and family members enable the addiction through inappropriate protection/sympathy afforded to the addict. The kindest thing we can do is to allow the addict to hit rock bottom.

    I look forward to seeing other comments as they are posted.

    1. I’d hate to see what rock bottom looks like.

      Live TV in the US is already unwatchable. A DVR is a must.

    2. I agree. I like the analogy to addiction and what we are seeing has elements of that. However, I also see an element of “tragedy of the commons”.

      Previously, TV stations (and newspapers) all had geographically limited reach and a limited number of competitors. Oligopolistic competitors imposes a certain displine on each other by punishing those who “spoil” the market. So it is easy to see that there may have been a well-understood self-interest in not flooding the market with ad slots, drive down the price and ruin the customer experience.

      The satellites, cable and Internet have dramatically increased the number of competitors that each encounters in the market. That means that the nature of competition has changed because nobody has significant market power and nobody looks after the common interest. That is, this is no so much an addiction but a commodity market in which the profit on the marginal unit is being driven to zero.

      If I’m right then there is no natural rock bottom or pulling back from the brink for TV. Increased distribution and the demise of the bundle would make matters only worse.

      1. Actually, I’d argue it’s the opposite. In a world where you can begin to choose individual channels (the a la carte model), if you believe that’s realistic, you’d pay far more attention to the content you’re getting for your money, and the balance between ads and content. Channels might also be in a position to ask customers to pay for for fewer ads, because the sale would be more transparent than at present.

    3. Great questions.

      1. I think “rock bottom” may be quite some way off still. But whereas an addict can almost always turn things around eventually unless there are severe health issues from past use, companies can’t always successfully turn things around when they realize they’ve been doing the wrong thing – just look at the number of top mobile phone makers from 10 years ago who are now down to almost nothing. I suspect current trends in ad spend and viewing will have to deteriorate very significantly before there’s a real change.

      2. Not sure about this one – there is relatively little regulation of TV advertising in the US (though there is some, mostly about content and volume rather than quantity etc), and there’s an argument to be made that there is an element of regulatory capture in evidence too. But I suspect it’s the standard US model of allowing the market to determine appropriate remedies, which goes back to the article and to the first point above: I suspect eventually the market will force the change that’s needed here – but the TV industry would be much better off it it made that change long before then, or at least began to prepare for it.

  4. The fact of the matter is that someone has to pay for the cost of TV Shows. And obviously, paying simply for the cable bill is not enough. And I doubt anyone wants to pay an even higher cable bill. So what TV has done traditionally is to make additional money via Ads. Free TV has always done it. Public TV has struggled and begged for money because it doesn’t do ads.

    TV shows are very expensive to produce. With less money for TV shows, there has been an explosion of reality TV which are the cheapest show to make. What you get at Netflix are the dregs of TV. Generally they are shows that have run out of value to syndicate independently so the producers try to squeeze out the last drops of income via Netflix.

    1. Let’s not forget, however, the model was built in the days when there was no way to get people to pay for TV, aka OTA. And since it was over public airwaves they weren’t allowed to charge.

      There is no reason for that to continue to stay the business model except no one wants to give it up.

      With the advent of cable we do have precedence of pay-TV without ads, all those premium channels like HBO and such. I guarantee premium content from premium channels can survive and thrive without ads. Right now they have to untangle themselves from cable TV agreements that are decades old.

      Provide something worth paying for, people will.


    2. And yet, Netflix has over 40 million US streaming subscribers, with no ads and the content they’re able to buy and commission for a cost of around $5 per month. Part of the problem with cable TV today is that there is so much filler around the content people really value. Strip it back to the stuff people actually watch, move away from the linear approach, and suddenly new business models and pricing models open up. The big risk is that traditional pay TV takes precisely the attitude you’re describing and stubbornly refuses to evolve, as Netflix and others move to new models consumers like better, and supplant them.

  5. Couple of remarks.
    1- Nobody’s forcing spectators to watch, nor TV stations to… add ads. So if that’s what’s happening, we can only assume it’s the best trade-off for all parties involved. I’m sure there’s a for-pay TV segment, and an Ad-supported one, both equally valid ?
    2- In my country, TV ads are regulated: 2 breaks max per film, 6 min/hr on average over the day (12min max in any given hour), and volume no louder than the rest of the programming. That makes ads scarcer = more expensive, I’m not sure the TV stations lose much in the end. And TV certainly is a lot more watchable. I can’t imagine the US regulating that though.

    1. I’m talking specifically about the US, where almost all channels have ads – the exceptions are HBO (which has always charged a lot to subscribers via pay TV providers and eschewed ads) and PBS (which is the closest thing to the publicly-funded channels common in Europe). My piece is about the fact that the tradeoff channels are making is not ideal, but that they have yet to come to terms with this. And yes, having grown up in the UK, I find the ad load there (on the channels that carry ads) to be more acceptable.

      1. The interesting thing is that the number of TV channels is unlimited nowadays. That leaves all the room needed for any ad load and experimentation: there’s room for ad-free for-pay channels, light-ads channels, heavy-ads channels… Aren’t we obliged to assume that whatever configuration we’re ending up with is the ideal ratio arrived at by some invisible hand to maximize economic returns, ie turning off people vs extracting their mind-share = money ?
        Isn’t the real question not how addicted to ads TV channels are, but how addicted to “free” content consumers are ? Is there a stable ratio of free vs cheap vs premium in media (press, radio, TV, and Mobile since I somehow think this discussion is heading there ^^) ?
        A side issue is the incredible amount of money some key content (sports, hugely successful shows…) is able to extract. Will that translate to IT content, and how ?

        1. That’s a highly theoretical view of how markets work – we all know that, though they generally produce fairly optimized results over the long run, it’s rarely perfect in the here and now.

          One of the other big challenges – and something I originally planned to include here – is the fact that advertising teaches consumers that content is free, whether it’s online news, TV, or whatever. That makes it extremely difficult to start charging for content in those same contexts, even if consumers are perfectly happy to pay in others (going to see a movie at the cinema, for example). In the US, though, consumers are accustomed to paying quite a lot for TV despite all the ads – $80-100 per month.

          1. I’d argue the TV market *has* had a fairly long run ^^

            We do have a counter-example to “free spoils it for paid”: free dailies popped up in Europe about a decade ago, and very quickly both grabbed a large share and expanded overall readership. I find that interesting:
            – free vs paid is not a zero-sum game
            – the rush to free is not 100% taught, it’s at least partly ingrained.
            – probably cost/benefits sometimes don’t work unless cost = 0 (say because benefit is nothing but a bit of noise in the background, or something to do instead of staring at the other travelers)
            So maybe the reverse is true too: for-pay locks out users.

          2. We’ve had a fairly long run, yes. But TV is very different today from what it was in the past, and as such it’s not like there’s been tons of stability for the trends to work themselves out – it’s been continually shifting, which makes it hard for market forces to really hit home.

            I’d also argue that the free dailies in Europe have dented rather than helped sales of paid papers, especially the evening ones – e.g. the Evening Standard in the UK, which had to switch to a free model to in order to stay in business ( I’d see this as further evidence that it’s very hard to go back once you go to free.

          3. I’m not arguing that free helps paid. I’m arguing that free newspapers increased overall newspaper readership, and overall (subs+ads) newspaper revenues. If I were the God of Newspaperity I’d deem that Good, overall ?
            To me, Free (and ads) aren’t evil per se. Greed is, and it does manifest in too many ads for ad-supported business models, but also in too-high prices for paid business models ^^ Then again “greed” and “too many” are judgment calls.

            As for pay-TV, I vividly remember France’s first for-pay channel in the 80s. They had some good, innovative, irreverent programming for all during “un-encrypted” hours that early teen me liked, and… other stuff later at night that teen me liked too :-p That was 30 yrs ago, and apparently cable in the US started even before that (Ted Turner’s stuff in 1976). Sure, online infinite timeshifting is more recent, but it’s probably less important than for-pay and unlimited channels. HBO dates back to 1972. I’d argue all of that has been fairly well integrated into the business by now.

          4. That first part gets to the heart of it – the goal isn’t more newspapers read, but more money made, which can happen in one (or both) of two ways: people paying for the paper, or advertisers paying to place ads. If no-one ever looks at the ads (even if they read the paper) then the additional circulation does no-one any good. And that’s the same fundamental problem the TV industry faces – people skip through or turn off the ads.

            And I’m not saying the cable model is new, but that it’s constantly changing, both itself and the context in which it operates. Netflix, Hulu, YouTube, Sling TV, Apple’s reported service etc. are all disruptions that change this context.

          5. I actually disagree with “the goal isn’t more newspapers read, but more money made”. That probably explains my Android advocacy too.

        2. “The interesting thing is that the number of TV channels is unlimited nowadays.”

          Personally, I think this is part of the problem. When most _channels_ serve arguably about 20% of interesting content, it isn’t hard to see that they are trying to do more than they can actually support. With the internet there is really little reason to feel obligated to provide 24/7 worth of content. We don’t really need more channels anymore. We just need content worth watching.


    2. It really is obnoxious. A 30 minute TV show has 8-10 minutes of commercials and a one hour show has16-22 minutes of commercials, depending on how popular it is. Unfortunately the more popular the show the more they can milk it for commercials.

      I remember getting hooked on the UK show MI5 (I think it was called Spooks in the UK). It was 55+/- minutes of actual show! It was almost like watching a movie. I found I could actually stomach a short season (it usually ran a 13-15 show season, where as here in the US a season is typically 20-22 shows. It used to be 30!)

      I dropped cable precisely because it chapped my hide that I was paying for TV twice—once for the cable service and again through the ads. Since most shows I wanted to watch were OTA network channels anyway, it was not a difficult drop. And for shows that mattered I would pay for them from iTunes to watch sans ads. I still paid less per year than for cable.

      The major problem is, just like with the internet the customer is rarely are really given a choice between ads or ads-free. You take the ads or you get nothing. TV is so addicted to ads, even when Hulu supposedly offered an ad free option, they have already started adding ads back in. Instead of really trying to figure out a solution, they went back to the drugs.

      OT: Speaking of the internet ad issue, the editors at iMore wrote an article recently articulating their disappointment with what ads do to the UX but still “need” ads. The only real solution is to come up with content people are willing to pay for. For some reason the conventional wisdom is that you need ads, the internet won’t survive without ads. I say horse hockey. People just don’t want to do the work to come up with a solution. They want to easy way. If iMore is going to serve ads, they have no one to blame but themselves for the UX. They should be unapologetic about it. Or stop whining and come up with a new model. No one is putting a gun to anybody’s head and saying “Serve ads or die!”.


  6. Good comments by the author. The ads have become so intrusive that traditional TV is almost unwatchable. From about x:48 to x:53 of each hour there are 5 to 10 consecutive commercials. Many of the ads are louder (or have a higher “noise power” content) than the programming. It’s just not worth it. I’ll get my news on the internet and watch entertainment programming on Netflix and Amazon Prime after “cutting the cord” in the near future. It has not gone unnoticed that the cable companies have instituted anticipatory rate increases for broadband internet service. They know what’s coming and will make up some of the revenue lost from cord cutters by higher rates for broadband internet service.

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