I’ve been reading the intensive debate this last week in the Yahoo ADM group, and now it’s my turn to chime in.

Some 25 years ago, I was part of the birth of another new media industry — cable TV. I helped start two cable TV companies and then consulted to many of the giants here in Denver. I have applied alot of the lessons-learned to starting my own podcast business; it’s almost identical.

When cable started, consumers subscribed to cable not because of new
content but because of improved reception to local and network TV. Cable was the iPod of that generation — creating convenience for accessing their favorite progamming. The first cable-only networks to
launch were super-stations like WTBS and WGN and then later CNN and
ESPN that were “ad-supported.” To pay the freight of carriage, the
industry struggled to define standards so traditional TV advertisers
would be able to understand and buy niche cable channels more easily.
The NCTA and CTAM were born to help set technical (for insertions)
advertising standards and make it easier for agencies and marketers to
buy cable. Sound familiar?

Shortly thereafter, the concept of ad-free “premium” channels was born
with HBO. It was hated. Remember the consumer boycots against “pay
TV”?

It’s important to remember that:

(1) Ad-supported channels actually CREATED the market for premium and for-pay content. Basic cable “taught” consumers to appreciate cable
TV. And then consumers ultimately saw value in paying to get rid
of the commercials. And as we know, consumers warmed to the idea of
HBO, Cinemax, Showtime and now PPV. So ironically the more we develop ad-supported podcasts, the more value and market there will be in pay-to-play podcasts.

(2) Unlike cable, we can explore new models for advertising and
sponsorship that are less obtrusive to consumers, while creating value
to marketers.

(3) Learning from cable, it pays to think long-term. Content is
ultimately king, and if we do our jobs right as an industry, we should
be able to give consumers the choice of getting good content for free
that is ad-supported, or good content for pay that is without ads.

(4) I have to believe that iTunes, Zune and other podcast portals are
going to want our industry to develop a premium and for-pay model.
How many stores do you know keep allowing customers to come inside and get stuff for free?

Patience. Learn from the past. There is room and need for both
monetization models, and maybe even some models that we haven’t
thought of yet. Some podcasters are making money through PayPal
donations. Has anyone ever donated money to a cable TV or broadcast
channel? Think about it. We can learn from the past, create familiar
standards and at the same time, explore and test new ways.

Let the consumers, not the ADM, decide. And that’s exactly what the
ADM is trying to do.