Advertising in Desktop Software?

In his post about Microsoft adCenter, Robert Scoble mentions the growth potential of “advertising-backed software.” I’m assuming he’s referring to web-based software, but I do wonder how long it will be before Microsoft enables embedding ads in desktop software as well. Switching software to an ad-supported model is something that Microsoft has considered for their own products, so it wouldn’t surprise me to see them experiment with this idea (especially since it’s an area where they could differentiate adCenter from Google AdWords).

This idea is nothing new, of course. I remember attending a Shareware Industry Conference before the first Internet bubble burst, and the place was abuzz with the possibility of giving software away and earning money from embedded advertisements. Adware companies like Radiate and Web3000 spent big bucks on the conference that year, and some of them relentlessly pestered developers to sign on with them.

It was pretty easy to tell who the adware people were, too: almost all of them were inexperienced guys with nice new suits, all juiced up on the idea of making a killing by piggybacking on our work. For the record, I tried to be cordial when they approached me, but after they kept hounding me I told them that I hated the idea and would be glad to see it die an ugly death (which it did).

Fast forward to today, and I’m seeing signs that the idea is trying to rise from its grave. I guess it shouldn’t be a surprise, since software developers are trying to make a living from an audience that increasingly expects to get everything for free – free music, free videos, free software, all supported by advertising (it’s all one big media platform, right?).

I still don’t like the idea, but it may actually work this time if those involved understand why it failed the first time. One reason it failed was simply because too much screen real estate was given to advertisements, and much of it distracted from the task at hand. But I think the biggest reason it failed was because too many developers deluded themselves into believing that giving their software away meant that they could compromise their customers’ privacy (the end result is that adware became indistinguishable from spyware).

And that’s a tricky problem. As I’ve written about before, people are more willing to give up privacy on the web than they are on their own desktop. Advertisers understandably expect accurate metrics, and most people don’t seem to care when this information is collected on the web – but they do care if that information is sent from their computer to some web site. So if desktop software is going to carry advertising, someone is going to have to figure out how to give advertisers the data they need without pissing off the people using the software.

In the meantime, I’ll stick with the idea of actually selling the software to customers. I guess I prefer being HBO instead of network TV :)

12 thoughts on “Advertising in Desktop Software?

  1. There’s an advert on the right hand side of Windows Live Mail Beta (the evolution of Outlook Express for non-Vista PCs)

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  2. Microsoft has had advertisements in its desktop products for at least a few years. Microsoft Money immediately comes to mind, with one or more ad units on the screen at all times.
    I didn’t like ads in software I had just paid for so I switched to Quicken, but it wouldn’t surprise me if ads were integrated into other products with a targeted audience.

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  3. I would not use software it is had adverts in it. I would rather pay the $30 to use the software adfree or, most likely, find another program to use. Adverts on websites are not a problem if they are not distracting however I block all animated adverts, etc. using adblock in Firefox because they piss me off.
    The biggest problems with adware is that people will get patches for them that either remove the adverts from the dialog (look at all the ICQ patches back in the day and the AIM and MSN patches today). Or they will just use third party advert blocking programs that run system wide (or just block the servers the adverts come from using the hosts file).
    If FeedDemon were to go adware, as an example, you can bet a patch would be available within 12 hours of you releasing a new version. For Microsoft products (such as Office) it would be out in 12 minutes.

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  4. I guess the biggest problem is that as a desktop application, the software can send ANY and ALL information from the computer on which it is installed. How as a consumer I would know whether desktop application is sending advertisement tracking information OR my credit card numbers/passwords? Am I supposed to baby sit all my adware applications? Sorry, that ain’t gonna happen.
    We know that browser is a sandbox for the web application and the application can not access any information from your PC other than what you have specified.

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  5. I have URL blocking set at my router that blocks requests from various ad sites, this causes some issues some times, but it prevents a lot of junk I never care to see :) However, my feeds keep coming in – which I enjoy quite a lot. Thanks again for a fine piece of software worth purchasing!

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  6. Another issue that might arise is how the ads get generated. Are you going to read my document? My email? My spreadsheet? And then target me?
    That’s creepy. Right now Google his making a killing because they’re paying close attention to our search criteria. I don’t want that kind of attention on my desktop.

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  7. JD, Rich – I think you’ve both nailed the problem, and it boils down to trust. You have to trust that the software won’t violate your privacy by collecting more information than it claims to (yet the mere fact that the software is trying to sell you something would make it less trustworthy to most people).

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  8. Someone mentioned the Windows Live Mail Beta, which I have installed, and I don’t actually think my main problem has to do with the adverts themselves, but just the space they take up. That screen real estate could be used to make the application far more attractive than it is now – and any ad blocking software isn’t going to help this, as this would just leave me with lots of empty white space. Just as useless, if maybe marginally less distracting.

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  9. Eudora Mail has three different options:
    1) Free – features disabled
    2) Sponsored – ad window most features enabled
    3) Paid – Everything + spam filtering etc.
    Eudora must have been doing this for a couple of years now. They get ads for Amazon and other email add-ons etc.

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  10. I think there’s already some examples of this – some bening, and some worrying. Opera, for example, had a free, ad-supported version until recently. Their experience suggests that the ad-support approach is counter-productive. I believe downloads increased when they made it ad-free. I wasn’t concerned about what opera was doing to generate the ads, but it didn’t feel ‘right’, and didn’t feel like a professional application, even though it was (and still is) a great browser.
    The other example I have seen is in medical systems in doctor’s office. There’s a bottom panel advertising different medical products. I don’t know if they are ‘context-sensitive’ but it is a concern that doctors may get some subliminal indoctrination this way.
    Imagine a medical suite designed by Microsoft – clippy pops up – “looks like you have cold. Do you need some cough medicine? Something to help you sleep?”…

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  11. With XP SP2 or an appropriate firewall, desktop cannot phone home that easy now. They used to do that, silently, without being seen. But personal firewalls make it harder, if not impossible. Thus I am not too worried about ads and other trackers being added to desktop software.
    That said, the ads should stop immediately from being served if the product gets bought.
    As for the privacy on desktops, well it seems that, with the help of Windows Genuine advantage, anybody is giving away their privacy now. I am not sure what to think about that, yet.

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  12. Just to point out another, MSN Messenger has had ads for a few year, the client now include MSN Search and a small footer link on each IM window that, normally for credit cards

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