Content doesn’t appear magically for free – anywhere!
The issue is how it is paid for, and can that be done in a way that doesn’t distract from the experience so users turn off. A secondary issue, in light of technology evolution, is the model sustainable as technology makes it easier for users to control their content experience.
iTunes currently sets the cost at $0.99/song for forever, satellite at $10+/month, TV and radio is free at some level of intrusion of ads on the content experience. Each model has trade-offs for both the provider and user, and both can game the system by bending the rules to their advantage (skipping ads with TiVo, change channels or embed ads through product placement or on screen images during content)
For audio content MP3 seems to have an advantage because some portion of users act as if the cost for MP3 content is $0.0/song – but that won’t last forever. Leaving aside the issue of personalization and variety – at some point the decision users will answer is $0.99/song or $10+month or ’free with ads”
The question for ad supported media is how to make ‘free with ads’ the preferred solution – or better yet how to make ads feel like content so it appears ‘free’.
The opportunities to do this explode when on-air and on-line are mixed. From contesting to profiled delivery if I’m interested for some other reason an ad doesn’t look like an ad and therefore doesn’t clutter my experience – but enhances it.