Jay Parkhill March 24th, 2008
Ads are the backbone of the Internet. Without them the “content is free” ethos would be entirely a lost cause. The ins and outs of who sells ads on the internet and who benefits from them is as important, therefore, as just about anything else out there.
VentureBeat discusses ESPN’s decision to stop using third-party ad networks, hire its own salespeople and bring in the advertising directly. As the world’s largest sports website, VB believes ESPN has the clout to pull it off.
I’m sure ESPN has its own salespeople for the cable portion of its business, so this is probably not breaking completely new ground.
However, here’s a thought about how it might get different. What if ESPN builds out its web-ad sales network really well? What if it then says to itself “hey, the content is free to consume but expensive to produce. Can we generate some extra revenue by placing ads on other sports networks as well? Maybe we’ll compete with ourselves a little for the pageviews, but if we get the right commission structure in place we’ll be just as well off.”
And then what if the New York Times has the same thought? They still have the cash to fund that kind of shift and they desperately need a new revenue model to replace paper subscription sales.
Is it too big a stretch to see the major news content producers turning into major ad networks? Maybe, but then again the 10% of my Sunday (paper) newspaper devoted to advertisements tells me maybe not. TV and print media have always been about wrapping ads around content in the best possible way. The Internet just makes it easier to sell ads around other people’s content as well.
Fun thought either way.Tags: advertising, business models, ESPN, New York Times