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John Quiggin

Pay attention: There's a cost

John Quiggin Australian Financial Review

12 October 2006

Whose attention is it anyway? That’s the question at the centre of the dispute between Holden and Ford, over the 54m blimp Holden is flying over sporting grounds at events sponsored by Ford. On a larger scale, the same question is the central focus of analysis of what’s been called the ‘attention economy’.

We’re used to the idea that we live in an information economy, but the amount of information and, for that matter, misinformation, now in existence is far greater than the capacity of anyone to absorb in a lifetime. This is most obvious in relation to the Internet, where the attention economy was first discussed, but it has been true ever since the development of mass communication technologies around the beginning of the 20th century.

On the one hand, there is far more information of interest, including TV and radio shows and movies, newspapers books and magazines, sporting events and cultural performances than we can ever possibly absorb. Thus, we need to allocate our own attention and try to economise on attention by finding reliable guides to interesting materials.

On the other hand, many of us have information we would like others to pay attention to. This is obviously true for those of us with products, services or ideas to promote, but all kinds of people have something they would like others to listen to or look at. To attract attention, it is necessary to present your information in an appealing or intriguing fashion, or bundle it up with some valuable good or service. The most obvious example is advertising, usually packaged with newspapers, magazines or electronic media.

As the value of attention has increased, attempts to grab it without paying have become more vigorous, and have attracted correspondingly vigorous resistance. It’s not that long ago that an unexpected phone call or email promoting some good or service might have been a mildly interesting diversion from the daily routine. But by the late 20th century, spammers and unsolicited telemarketers were recognised pests. Now spammers are criminals, and telemarketers are tightly restricted.

Technology has created problems on the other side of the market. The implicit contract associated with commercial television has always been that, if you watch the program you watch the ads that pay for it as well. Attempts to push this too far, such as the US executive who claimed that viewers who went to the toilet during the ad break were in breach of contract, have been rightly met with derision. And, if the ads go on too long, viewers may change channels, or even to for a walk. Still the basic idea of bundling ads with shows viewers want to watch is clear.

The bundling model was robust enough to stand up to the VCR, despite the potential it offered for zapping ads. It remains to be seen whether it will accommodate more sophisticated recording technologies such as TiVo, the programmable digital video recorder.

Once we understand the information economy, it’s easy to see that the attention of sports fans doesn’t belong either to Holden or Ford, but to the fans themselves. In buying a ticket to an event sponsored by Ford, the audience is trading some of its attention, paid to the ads around the ground, or worn by the players, in return for a lower price of admission.

By capturing the fans attention without paying, Holden is reducing the value of attention to its owners, and thereby making them worse off. They are in the same fundamental position as spammers and telemarketers.

The case of so-called ‘guerilla’ or ‘viral’ marketers is even worse. As the name implies, guerilla marketing efforts are based on disguise, with seemingly ordinary social contacts being used to market goods or services, ideally in such a way that the target audience is left unaware they have been marketed to. This kind of activity is criminal when it is used to tout stocks, but it’s no better, in ethical terms, when it’s used to sell goods or services.

As the value of attention is recognised, marketing methods that have long been accepted will be reconsidered. An obvious example is billboards aimed at motorists. Around the world, both private road owners and public authorities are asserting their right to control advertising directed at their customers, both on safety and economic grounds.

The central rule of the attention economy is simple: if those promoting products or ideas want us to pay attention to them, they should be prepared to pay in return, either in cash or in useful information.

John Quiggin is an Australian Research Council Federation Fellow in Economics and Political Science at the University of Queensland.

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