Call it liberal, call it progressive, go ahead and call me this. Advertising! CAP is running four different types of these ads, including 2 that spoof the Mac/PC ads, in 3 markets.

I’m not fond of the Mac/PC spoofs because they cheapen the message. Love the one above and this second one below.

We won’t use someone like Ann Coulter to get our message out, so these ads will have to do.

In a comment at Josh’s place, slugfest asked what would happen to network TV if everyone bought TV shows online rather than watching them via ad supported TV. That’s the question I set out to answer tonight. Beyond the general point, it’s another angle into the NBC/Apple dispute.

I’m not that familiar with the TV advertising biz, and if anyone that knows better wants to chime in, I’d appreciate any insight. I’ll see if I can track down someone at ABC or ESPN to give me a better explanation.

For now, here’s my methodology to do a rough estimate. The key piece of data is the price of a 30-second spot. We also need to know the number of commercial slots per hour episode. We then need to estimate the number of households that would have to purchase iTunes to match the episode’s actual viewership.

Working backwards, here’s how I decided to tackle this. I’m going to assume an iTunes purchase is necessary per household. So, I should be able to take the number of households implied by the episode’s rating or share and just use that number directly. Looking through the 2007 Studio Briefings, a top 10 show averages around a 10-12 rating (non-rerun), which comes out to about 11.1-13.3 million households.

Looking at episodes of Lost, House, and CSI on iTunes, I’m seeing an hour episode running around 43:30, which means that there is 16:30 allotted for commercials. In order to simplify the math, I’m assuming this is sold in even 30-second chunks and is all national advertising. So, no regional slots, no splitting revenue with affiliates, cable broadcasters, etc. That makes 33 slots per hour.

The hardest thing to find was the per slot price for a 30 second spot. After a fair bit of Googling, I found several sources reprinting an AdAge article that breaks down the rates for the top 10 shows in 2006-2007. For the sake of simplicity, again, I’m going to pick an average for the top 10 at about $400,000 per 30-second slot. Obviously, this could be higher or lower depending on which show you’d like to do the math for.

So, based on these numbers a typical hour episode of a top 10 TV show brings in around 33 * $400,000 =~ $13.2 mil. This estimate is going to be on the high side because I doubt the national network gets all of the slots, as I mentioned before.

Based on the household numbers of 11.1-13.3 million households, we can estimate a gross take for Apple at $1.99 * 11.1 mil =~ $22 mil. At 13.3 mil households, it’s around $26 mil. Assuming it’s a 50/50 revenue split (unlikely — Apple probably takes a very small percentage), the network rakes in between $11 mil and $13 mil. More if they command a larger percentage of the retail price.

Based on this quick, “back of the envelope” math, it sure looks like TV will live if we all started paying for what we watched, at least as far as the top shows are concerned.

Where NBC may have a point, though, is if they wanted to reduce the price of some shows on iTMS based on ratings. I shouldn’t have to pay the same for, say, Mythbusters or Ice Road Truckers as I do for Lost or Heroes, which are way more popular. That’s not what NBC is arguing with their desire for “flexibility in wholesale pricing”, since they seem to be complaining that the prices are too low. TV Squad interpreted that statement to mean that NBC wanted to offer special promotions so that you could get an episode of The Office when you buy Evan Almighty (TVSquad’s example). That sounds as bad as the current cable scheme where I pay one “low” price and get more channels than I can watch.

As I mentioned above, I’m interested in feedback, corrections, or additional information from everyone, especially those more knowledgeable about ad sales and the TV business in general. I think this is a worthy conversation to have.

Update: One other thought: the total ad dollars above, based on a rating of 11 (12 mil households), would create a per episode price of $1.10. And, these are for the top 10 shows over the year. How much is something like Battlestar Gallactica or Psych or What Not To Wear worth in this scenario? Something else to think about.

I got another rich ad from Google Adsense on FatMixx. These are clearly widgets, not just plain old rich ads.

Why is it a widget? Because you can embed it. Check the “Share” tab out:

In fact, I’ll embed it here:

Hopefully that works. That’s a great advertising model.

Update: Hmmm, the embed tag doesn’t work… wtf? I’ve checked the code again and I don’t think I embedded it incorrectly… anyone have any ideas?

Update 2: I see what might be wrong. Should be fixed in a sec.

Update 3: OK, so Wordpress bit me in the butt again… this time, the dynamic_replaces in the wptexturize function replaces the x in 300×250 (see the different x?). That value was in the URL, so that broke the URL and kept the embed from working. I hate these fancy replaces WordPress has, and may finally just give up and turn it off. I do like the extra typographical flourishes, though… Just wish it would detect whether it was in an HTML element or attribute or script block. I fixed this by replacing the x in the URL with %78, the urlencoded value for a lowercase x in utf-8.

Yesterday a buddy at work noticed something very odd on Ain’t it Cool News: McDonalds ads, one rich media (flash) and the other the large rectangle text ad you see in our comments section. Think about that for a second. McDonalds is a company that isn’t really selling anything online and that usually does brand advertising (e.g. advertising on ESPN.com because their target demo visit the site heavily). Yet, they’re distributing advertising targeted to Ain’t it Cool via Google’s system.

I’ve been seeing more an more mainstream ads in general, marking an important shift in their advertiser base. Everything from semi-fringe companies/brands/people like William Shatner:

to large companies like McDonalds and Microsoft:

Sorry, I didn’t get a screen shot of the McDonalds ads… they’ve disappeared today.

It looks like Google may truly be making the best advertising marketplace out there. This will be pretty significant, especially if they’re not matched by Yahoo or the other ad networks out there.

OK, enough with the goddamn employee discounts already. After GM rolled out their employee discount program, a bunch of other car manufacturers did the same thing. Now, it’s gone too far. This morning, I got an email from the Stylus Studio folks about their brand new promotion. Know what it is? That’s right, they’re offering an Employee Discount for Everyone! From the Press Release:

Stylus Studio (http://www.stylusstudio.com), the leading provider of XML tools for advanced data integration, today announced that for the first time in history, its employee discount on the Stylus Studio® 6 XML Enterprise Edition is being extended to XML developers everywhere through July 31, 2005 at the Stylus Studio Online Shop. You pay the same great price we pay.

Yeah? Really? Guess what the employee discount is for this promotion? A measly 10%. I used to work with these guys (in fact I had a role in Progress’s acquisition of the product and their former parent company) and I can tell you unequivocally that the “employee discount” was 100% . As in free. I had copies I used for learning how the product works and to use it for real-world projects that I was given for free. I bet Ivan and Minollo don’t even think twice about using the product at home if they need it.

It’s all fair and good to offer sale prices on your stuff, but it’s really quite pathetic when you’re copying another promotion to somehow get in on the “employee discount” buzz. Especially when the discount is, well, lame. Software companies aren’t usually stingy with the employee discounts. So, come on guys. Get serious and do some serious marketing… not this dumb stuff.

Of course, I can’t even use this program (it’s Windows only). Instead, I recommend Oxygen for XML development. It’s cheaper, lightweight, and does most of what you need at a lot less. And, they’re don’t have lame promotions… they’re offering 34% off their professional edition. It doesn’t have anywhere near the same features of Stylus or XMLSpy, but for the price it can’t be beat.

Don’t get me wrong: the guys that work on Stylus are among the brightest programmers I know. They’re not, however, great marketing or business people. It seems that being a part of Progress really hasn’t rubbed off on them much. That’s too bad.

Update: OK, so I got the story from a former coworker… apparently, they’re making fun of the whole thing, which I guess I see. So, my grumpy message above should be ignored. My post wasn’t really supposed to be about Stylus anyway, but the whole copycat nature of the “employee discount” promotions… which is what they’re making fun of, so just go ahead and call me an idiot.