Hacker News Reader

Comment by isostatic | Hacker News Reader

Good. Adverts are a drain on society, they increase prices of goods which are advertised, and mean you as the product/consumer end up paying more than the service/website gets, as the adverts take a cut.

Look at television in the US, or even in the UK on non-BBC channels. You watch something for an hour, you get 40 minutes of actual use out of it, you get massive breaks in the narative which reduces your enjoyment, and you waste 20 minutes of your life.

Does this mean you get free tv? No, you're still paying. The only reason that $CORP spends $1 advertising to you in your program is because it will make you spend more than $1 with them at some point in the future.

When you watch advert TV, you're selling 20 minutes of your life not for $1, but to shift your $1 expense now to a $2 expense hidden elsewhere in the future.

Far better to save 20 minutes, and that $2 in the future, by spending $1 upfront, and being the customer, not the product.

View on HN

> they increase prices of goods which are advertised

I think that's completely false. The price of things goes down with volume, and if no one knows about something its going to be far more expensive than something everyone uses.

Advertisings entire purpose is to increase the volume sold, which lowers the price.

http://www.altfeldinc.com/pdfs/BASICECONOMICS.pdf is actually decent reasonably short and enlightening read if you find yourself with some time.

> I think that's completely false. The price of things goes down with volume, and if no one knows about something its going to be far more expensive than something everyone uses.

That applies between companies (where you have real competition), but does it apply over a marketplace? And even if over an industry you were able to persuade more people to buy more product, is that necessarily delivering value for the customer? Wouldn't it just be better if they found things by going out and looking for them if or when they need them, and soliciting expert advice?

The obvious example is pharmaceuticals, if patients seeing adverts leads to more prescriptions for a particular drug, is that a good thing? If the pharmaceutical industry manages to get people to take more drugs, is that a good thing? The unit price might go down, but that doesn't mean utility for the consumer goes up.

Completely false. As volumes sold ramp up the company makes more profit per unit, it's almost unheard of to cut prices. Competition on the other hand can lower prices.

If anything these days they tend to increase price as market share increases.

But increased ads grow the category around the same product so competitors benefit from it too and overall in more competitive markets prices go down on average.

> Advertisings entire purpose is to increase the volume sold, which lowers the price.

Problem is, if everybody does advertising to compete for market share, the prices go up globally, because the entire ads industry consumes resources.

But for now we haven't figured out any better model. We might in the future, or we might not.

Netflix seem to be doing very well without adverts

How much does a website typically earn from my visit (with adblock etc)? I haven't had a site with adverts since 2000 so no idea

Sky in the UK gets something like 80% of revenue from subscription, but still have adverts on top of that, trying to extract every last penny. Thats why I won't subscribe -- plenty of other choices for entertainment. If your time is worth say £15 an hour, having 2 of you watching a 40 minute program and 20 minutes of adverts costs you £10. Given the income ratio is 8:1 revenue, your £24 subscription brings in £3 of advertising money to sky per month, if you watch 1 hour a day, that's 10 hours a month, or your time being worth 30p an hour.

No thanks.

Netflix can also restrict access to paying users. Can every site out there do the same (while maintaining a viable business)?

How much does a site earn from an average visit?

But Netflix advertises itself a lot. They still factor the "ads industry" costs in (which practically everybody does in competitive markets).

Don't know about very well, but I do know about the ads and if you're in any UK major city, you should've seen a ton of Netflix ads, recently on the 'Lost in space' a series of wooden block attractiveness that I've personally attempted to watch only because I've seen it on the ads.

It's somewhere in the middle, depending on how elastic demand for the thing being peddled is.

If you're talking about something like Coca-Cola, where each ad exposure might prompt someone who already has a fridge full of Coke to go grab a can right now, then yeah, that is very much true.

If you're talking about something like prescription pharmaceuticals, where demand is tightly constrained by how many people actually have the condition your drug treats and what doctors are prescribing, then I would bet the GP is correct. Then I'd expect advertising for competing drugs to behave more like a prisoner's dilemma.

prescription drugs are only advertised in the US so in the grand scheme of things its a minor market for ads.

They are. And the US also has famously high prescription drug prices.

I'm not certain that the two are related, but it certainly seems plausible.

It makes a lot more sense that that would directly tie to the US healthcare system approach and how it prices products & services rather than more to the ad market impact.

Everything in the US healthcare market is similarly far more expensive. From radiologist salaries, to a bag of saline, to hospital stays.

You could cut pharma prices in the US in half through increased negotiating power, imported drugs and government price restrictions for Medicare/Medicaid and still have a very large industry full of advertising.

This is nonsense. Ads are payed with sales. Money is not created or destroyed in the process, therefore...

Ads are paid with VC money, mostly.

Ads are primarily paid for by Procter & Gamble, Berkshire Hathaway, GM, Comcast, AT&T, Pfizer, etc.

Procter & Gamble all by itself spends $7 billion per year on advertising.

The top 100 advertising companies in the US by spend - not one of which is a VC firm, a tech start-up, or powered by VC money - spend more annually on advertising than the entire combined value of all venture capital in the US.

You can easily see this in action: when venture capital plunges dramatically every five or seven years, the total US ad spend doesn't similarly plunge with it.

Directly paid for, yes, but the whole adtech industry is mostly financed by VC money. What P&G et al pay doesn't nearly support the "industry".

Why spending $2 is necessarily bad? I could be buying advertised product that actually improves my life that I wouldn't have known about otherwise. While it's not the case all the time, there's no explicit loss to you in spending more.

Also in regard to TV, ads are needed even for simple toilet breaks. Excessive ad amount such as 20 minutes per hour is definetely way to much, but some time off the show makes sense in broadcasting where the user can't pause the show whenever they want.

There are no toilet breaks at my cinema either, what's the difference to TV?

There are intermissions in films > 2 hours in European cinemas.

In some cinemas, for some especially long films.

I have only encountered breaks twice: for Titanic and Pearl Harbor.

Infinity War had no break where I went to watch it.

Infinity war had an hour long intermission before anything started for me :(

We were sat outside the cinema drinking a coffee and talking, the ushers were very concerned we were missing the 8pm showing. Walked in at 8.30 as normal, still had 10 minutes of trailers.

Cinema adverts acknowledge that nobody likes them, and cinemas wonder why people do t turn up. Perhaps they should stop treating paying customers as a product.

Infinity War, the latest Star Trek, and the Hateful Eight had intermissions when I went to see them.

I've never had an intermission in any film (unless you count 12 months waiting for the sequel), although I can't think of anything longer than 3 hours. That would be horrendous, and would certainly mean I don't visit the cinema.

It is how our system works. I am always curious when I see a post like this and how do you think it should work?

In other words how would business work without ads?

> Does this mean you get free tv? No, you're still paying. The only reason that $CORP spends $1 advertising to you in your program is because it will make you spend more than $1 with them at some point in the future.

Not necessarily. It could be that the advertisement gets you to spend that dollar that you were going to spend anyway on them rather than their competitor.

So Tesco spend £1m taking 100k customers from Sainsburys, and Sainsburys spend £1m taking 100k customers from Tesco. No overall change, other than Tesco and Sainsburys customers end up paying £10 extra on their shopping, what a waste of everyone's time and money.

If the advertisement is "Buy our static analysis tool. Catch bugs in your C programs", your argument considers the purchase equally as bad whether it catches 0 bugs or 100 critical CVEs.

Most people don't use static analysis tools, so without persuasion the purchase would never occur.

Which highlights the need for a neutral product-discovery tool.

Advertising makes most popular the products with a higher marketing budget, not necessarily the better ones. For example, search for "youtube downloader": at least the first ten results link to shady websites and apps which offer a crappy wrapper around youtube-dl, which is the ultimate youtube downloader but unknown by non-programmers. Even among wrappers, the clean versions are not as popular as the advertised and SEO'd crap.

Reply on news.ycombinator.com