Perhaps there would be a massive public health benefit! I could legitimately see that. We just need to properly weigh all of the negative outcomes alongside the positive ones when discussing a change, otherwise it's an exercise in mental masturbation.
And on your first point, I don't think most ad driven services refuse to offer paid plans because they are afraid to show their products without ads. Most would diversify their revenue stream if given a reasonable opportunity.
Hah, perhaps I was not clear enough in my original comment because I agree with everything you wrote after the first paragraph.
I strongly agree with this sentence: "in short, these platforms work to maximise profit. ads serve to form another income stream, and as long as they don't push sufficient numbers of customers away, it's always in the short term interest of the provider to expand advertising income until the marginal gain equals the marginal loss in marginal revenue from the consumer base."
That is 100% accurate. However, that doesn't mean that ads do not affect the price of goods and services.
Businesses are always looking to find the sweet spot to maximize profits by pulling on different levers. These levers could represent price increases, advertising, lowering production costs, etc. Businesses will always be looking for the most efficient lever to pull. And I guarantee you that if you somehow figure out how to take the advertising lever away, they will pull a different lever. This could result in a higher price, a lower quality product, or something else, but ultimately something has to give.
This explains why advertising is likely to encroach on all platforms, because as users become more accustomed to it there is a higher likelihood that it is the most efficient lever to pull.
And of course I agree that it is generally not the case that you could pay 5% more to be rid of ads. The Hulu example was just a good illustration of how to think about the relative value of advertising to Hulu / the consumer.
This article misses by far the number one benefit of advertising: it makes products and services cheaper.
That notion obviously applies to the plethora of "free" (free in quotes because I am not trying to dodge the fact that you are always paying something) websites which everyone frequents, but goes beyond that as well.
There's a comment on here complaining about how Hulu shows ads despite the fact that they are paying for the service. Well, you can pay more and not see those ads, but you have made a conscious decision to pay less for the service, so you get to pay some of your attention instead.
Back to the article -- it claims that "a hypothetical doubling of advertising expenditure would result in a 3% drop in life satisfaction." What I would like to see is some analysis of how much life satisfaction is earned back if all relevant products become proportionately cheaper. Then we would be in position to figure out what the sweet spot for society is using a price:advertising ratio as a slider.
That would be very interesting and result in a more productive conversation.
And on your first point, I don't think most ad driven services refuse to offer paid plans because they are afraid to show their products without ads. Most would diversify their revenue stream if given a reasonable opportunity.