Can you imagine reading a really gripping novel with full-page ads in the middle of its pages?  Or imagine watching a movie that keeps getting interrupted by ads?  If we, as consumers, detest ads so much, why do we tolerate them while watching television? Is it, because the content is almost free (save the cable bill and the TV we bought) and hence it’s an unspoken barter?

Why waste your time watching ads?
Why waste your time watching ads?

Till very recently, there was also no option to skip ads, but today with television programming recording devices, we can easily ‘time shift’ our viewing and hence watch pure content without the ads (skipping the ads by fast forward) by recording the program in advance.  Shouldn’t this have meant that everyone should have bought the boxes and TV advertising died a guillotine death?

The box devices’ guys don’t seem to have rocketing sales and they are still educating us and cajoling us to buy their magic boxes.

I put on a slightly different cap and thought of measuring this time spent on ads as an economic model. Trying to understand what people earn per minute and how and when will they presumably switch to creating a better return on their time by pre-recording content and skipping ads.

The results:

Yearly Salary in Indian Rupee TVprograms watched per day* Ads in between programs in minutes** Value of time wasted in Indian Rupees Value of time wasted per year in Indian Rupees Tata Sky + box fixed cost Indian Rupees Personal Profit or Loss for the consumer
200000 60 minutes 15 6 2083 5999 3916
400000 60 minutes 15 11 4167 5999 1832
600000 60 minutes 15 17 6250 5999 -251
800000 60 minutes 15 23 8333 5999 -2334
1000000 60 minutes 15 29 10417 5999 -4418
1200000 60 minutes 15 34 12500 5999 -6501

* Based on actual viewing of 12 channels across all categories and measuring the ad breaks between content.

In my estimate, those who earn more than 50k a month (6 lacs per annum) actually create a negative return on their time by watching ads and not recording content in advance.

Having said this, has everyone who earns 6 lacs+ in India converted to a TV storage device? Definitely not!

So, I decided to flip the argument by working the tables in reverse- Deriving annual incomes of consumers on the basis of what they were actually spending on pure entertainment in India:

Entertainment option Minutes of pure entertainment content delivered Typical Cost in India Per minute cost in Indian Rs What this means as Annual Salary in Indian Rs
Buying a Moser Baer VCD 120 30 0.25 1.3 lacs
Buying a book 600 250 0.42 2.19 lacs
Renting a DVD 120 75 0.63 3.28 lacs

The interesting observation therefore is that lots and lots of consumers who are below the 6 lacs per annum salary benchmark still invest heavily in pure content consumption – but still shy away from blocking ads on TV by buying recording boxes!

Is it possible that:

  • The concept of recording and watching TV content is still not understood and hence not adapted?
  • Ads are also entertainment!!
  • It's just the way we have been brought up consuming content – TV has ads but a book does not!

Consumers natively understand the value of their time and move fast and in herds when they get options to spend their time better. There is a huge disruptive revolution waiting to happen in the business of television advertising and where better to witness it than a country with a billion consumers!

*************

Originally posted on Feb. 25, 2010 on rodinhood.com

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I guess ads are intresting!!

Many times i catch myself watching ads... :p

But thinking about it I feel pure content would increase the cost of content (and mind you the content on tv is premium content). Somebody's got to pay for it right?

Bahut Khoob Sir.... Dho Daala!

A few Days back I Switched to TATA SKY HD and while watching a Movie was amazed to find almost No ads.

While the same movie was coming on the NON HD Channel started at the same time... but was running behind Schedule as it had regular ads. And that movie ended after 1 hour than the HD one. Just because it had 1 hour of ads running.

Instantly I realised that I was wasting an extra hour while watching movies at other TV Channels. And hence now the Movies are only on HD, due to the Quality and No Ads issue.

Ads are not just interesting, they are quite informative as well. For a person like me who tends to grab ideas from anywhere, ads serve as a huge library of potential business ideas. Of course, I'm not talking about those ads that really suck!!

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