When Amazon launched the Special Offers program in may 2011 their goal was to reduce the price of the Kindle hardware by selling ads to 3rd parties, and collecting fees when the ads were viewed or click.
Something tells me that this ad network isn't having nearly as much luck as Amazon might have wanted.
As you probably know, I have a Kindle Fire HD. I used to tune out the ads that Amazon shows on the lock screen, but that has been harder to do over the past few months as I began to notice that more and more of the ads showed ebooks, deals, and other content related to Amazon.
I think what I am seeing is filler - in other words ads that promote an Amazon product or service which are shown because Amazon wasn't able to sell enough ads to 3rd parties.
Take today, for example. In the past couple hours I have seen one ad for Geico mixed in among many ads for:
- the Kindle Daily Deal
- a $3.99 ebook published by Amazon
- Kindle FreeTime unlimited
- the Amazon Appstore free app of the day
- 10 Kindle ebooks for $1 each
- a $1.99 Kindle Single
- a $4.99 ebook published by Amazon
Now, I'm sure that some might suggest Amazon has sold enough Kindle Fires that Amazon can't sell enough ads. That could be true, but now that the filler accounts for over 90% of the ads I don't think the problem is excess capacity.
Yes, over 90% of the ads shown on my KFHD's lock screen were a net zero in terms of ad revenue. They're not being sold to anyone, not unless Amazon bills itself. But even if they are Amazon is still losing money when they promote a Kindle Single, the free daily app, or the Kindle daily deal.
I think what we are seeing here is that no one wants to buy ads any more, and that is going to be a problem for Amazon.
I have been saying (ever since the KFHD shipped) that this tablet exists just to show users ads. Amazon even went so far as to lock down the KFHD so you can't install your own home screen or replace the lock screen. this would let you escape the ads, and Amazon does not approve.
But now we are seeing that hardly anyone wants to buy the ad space on the KFHD. Amazon's latest marketing brainstorm is, based on what I can see from the outside, a bust.
What do you think?