Sevakis, what are the difficulties in selling ads on websites where content is given for free?
Mr. Sevakis highlighted the first problem is the economy. Internet ads sales are down for the first time in history. Digital distribution was already new and risky, and a lot of people who buy ad space, such as media buyers, don’t get it yet. For example, one of the ways to monetize digital distribution is called the lower third. The advertising is placed on the lower third of the screen. The problem with the lower third is that the advertising is right where the subtitles would go. Mr. Lewis mentioned that other platforms are addressing it. For example, Hulu has inserted ads, and many people don’t mind these ads since they are in it for the content. Mr. Gao suggested that acceptance is dictated by the format of the ad. At Crunchyroll, they have advertising in the upper third. He admitted that there is still a need to educate advertisers. Anime is still niche, but that means companies need to educate advertisers about how passionate the fans are and what the payback looks like. Mr. Sev
