The Economics of Free TV Shows

You caught up and got carried with the story right away. You followed the hero to a dark place,Guest Posting an abandoned room where someone was brutally murdered by an unknown assailant.

Suddenly, there was an unmistakable sound of hurried footsteps from somewhere. Both you and the hero looked at where they came from. And you winced, and you groaned.

On the TV screen, two Chihuahuas are seen dancing a lively cha-cha while singing the tasty goodness of delicious nachos and fajitas of Tito Pancho’s, a local Mexican deli.

You did not expect a commercial at that moment of extreme anxiety. You shrugged, and knowing that there will be others coming after that, you thought you’d want to take a bite at your snacks.

You then discover that what you have are nachos, and looking at the wrapper, you suddenly remember you ordered them all from Tito Pancho’s.


Since the first TV commercial (a Bulova watch) debuted in July 1, 1941 during a game between the Brooklyn mary martin steve martin Dodgers and the Philadelphia Phillies, television advertising has come a long way to becoming a 50-billion-dollar-plus industry that it is today in the U.S. alone.

The flowering of the television industry began in the 50s when affordable TV sets made it to American homes. At that time, free TV shows are usually paid for by one sponsor, just like how they did it on radio before. Philip Morris solely sponsored I Love Lucy. Most of the sponsors incorporated their company’s name into the shows (Colgate Comedy Hour, The Firestone Hour).

Later, the costs of producing these free shows grew. In turn, the advertising costs became more expensive. Single sponsors couldn’t shoulder these costs alone and these free shows took in multiple sponsors. Commercials also became shorter and shorter.

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