Friday, October 1, 2010

Indifference Principle - TV Commercial Edition

The US Senate is considering banning TV commercials being broadcast noticeably louder than programming. How would the broadcasters react? Well, why are commercials so loud anyway? I am pretty sure it is because most viewers are like me and often leave the room during commercials for small errands. Higher volume allows advertisers to better reach their audiences in the kitchen (or maybe even the bathroom). If the volume restriction means that they will reach a smaller fraction of their audience, then TV advertising is not as valuable to them and they will not be willing to pay as much for a given commercial. Broadcasters who rely on this advertising to underwrite the program production costs will likely respond with 1) less investment in program quality or 2) more advertising per program.

I do not know what the correct policy is. I know that I find the higher volume annoying and I reach for the mute button more often now than before. But I am not sure that I would prefer more but quieter ads or lower production values.

No comments:

Post a Comment