I’ve never been all that silent on the subject of in-stream Twitter advertising, and since it’s the topic du jour today, I thought I’d weigh in on the blog post over the weekend that seemed to be the furthest out of line from the rest of them: Robert Scoble’s post entitled “More thoughts on in-Tweet advertising.”

The post wasn’t all bad, and covered a lot of ground, but when it meandered into the specifics of how in-stream advertising should be, it really seemed to be off-base from what I view as correct and feasible. Mostly, though, I think it bears rebuttal simply because Scoble has a pretty large soapbox from which to put forth his views, and these views could use some critical analysis.

Part of the problem is that his views are rooted in personal preference and opinion, rather than the hard numbers.  Witness (from his four reasons he really doesn’t like in-tweet advertising):

1. I like a strict firewall between editorial (er, words you write) and advertising (words someone else writes that they pay to put in front of your audience).

Like we’ve enumerated many times, Twitter isn’t the only place that content is mixed with paid placement.  It happens in blogs, on podcasts and not just at rinky-dink joints, either.  Techcrunch, Mashable, ReadWriteWeb and even Leo Laporte’s TWiT network all participate in the seamless integration of sponsored posts / spots with editorial content.

Other Coverage Today on Twitter and Advertising

Twitter Will Introduce an Advertising Model and It May Look Like This

The Case for In-Stream Advertising

How To Become Fabulously Wealthy From Ads in your Twitter-stream

If you want to get real technical about it, Robert Scoble does this, too.  The main difference here is that his sponsorship is sold at a premium, and he has one primary sponsor: Rackspace (disclosure – Rackspace sponsors SiliconANGLE as well). We love Rackspace, and undoubtedly Robert does as well. We agreed to the sponsorship arrangement because we believe in their product, as does Robert.  We feel comfortable dropping them into conversations, posts and tweets and not getting accused of shilling, as a result.

That doesn’t mean that the metaphysic firewall is somewhat lowered between editorial and advertising, though (even if the “physical” firewall is less apparent). There’s clearly money that’s changed hands in both Robert’s case and SiliconANGLE’s case… but people still trust both of us.

Bottom line: there’s nothing fundamentally wrong with that firewall not being in place.

In-stream Ads Aren’t Priced Properly – or Are They?

Robert continues down the list:

2. I don’t think the ad models out there price things properly. 10 people are not the same. Here, let’s say I have 10 people who are poor. Is that list worth the same as, say, 10 people who will buy a house in the next month? No way. Yet on Twitter and other streams we just don’t know enough about audiences to price ads properly.

I think this is a somewhat weak argument.  No forms of online advertising have the lock on income levels. AdSense doesn’t allow you to pick only advertisers who have high incomes.  Facebook doesn’t allow you to pick by income level (reliably). Even sources like Quantcast that allow you to make decisions about audience and which site you’ll advertise on doesn’t allow you to pick reliably by income level – they’re all best guesses based on survey data. It’s a fact of life.

The Facebook Project Beacon Argument

3. If Twitter or Facebook becomes infested with instream ads it will piss everyone off and we’ll all leave, so any investment in building audiences in those systems will be destroyed by the greed of other people (I don’t run ads, but if I’m the only one who doesn’t then it doesn’t matter because no one will stay there. Already on Twitter I’ve seen even good friends, like Chris Pirillo, run tons of ads — I unfollowed him because I got tired of it).

This simply isn’t true.  Robert may have unfollowed Pirillo to make a point, but in general, this behavior isn’t pervasive.  I’ve had a grand total of about five people unfollow me personally because of ads I’ve run in my tweets, and I’ve been running them since the days when Sarah Lacy, Mike Arrington and Marshall Kirkpatrick had a hate-on for advertising on Twitter.

The truth is that most people understand that there will be advertising in Twitter, as there is everywhere. Even Mark Suster, who posted earlier today on this topic here at SiliconANGLE, says that while he doesn’t enjoy ads, he understands the need for them:

I feel the same feeling about advertising as most consumers.  I feel it’s a necessary evil.  Yes, I often skip commercials when I watch on my PVR.  But I also accept and appreciate the ads in Hulu because I know that I’m watching shows for free.  I know that advertising is important to inform consumers of offers – the same reason many tech companies use SEM.

He’s an investor in Ad.ly, a major (if not newer) player in the Twitter ad game. If we’re going to have ads on Twitter (and trust me, we will have ads on Twitter no matter what), shouldn’t we have an ad program that rewards the users as well as the owners of the servers?

Advertisers are Getting Ripped Off?

Robert goes into his final point:

4. I believe advertisers are getting ripped off, because some ad systems aren’t sharing the REAL value of a person’s audience and is using just lame metrics like number of followers to price out ads. When advertisers get ripped off, they figure it out pretty quickly and tell everyone that the system is screwed and to avoid at all costs. That sort of happened with Second Life (I worked at Microsoft and we put lots of money into an island’s design and didn’t get the return we should have).

This isn’t the case I’m seeing, and that’s coming from someone that is an advocate for in-stream Twitter advertising but has no real skin in the game.  As I talked about a month ago, I pay one of my utility bills via Twitter advertising, and as I’ve talked about in the past, I’ve run Twitter ad campaigns on Magpie before.  There are certain kinds of advertising that do well there, and certain kinds that just completely tank.

Fortunately, it’s the ads that are of higher quality and lead to interaction rather than affiliate sales that seem to do the best – which is a good ecosystem to have. It rewards the right kind of behavior, and exactly the kind of ads we all hate to see are the ones that will be punished for trying this sort of activity.

Are there problems with in-stream ads? Sure. I’ve never been shy about saying it’s a slightly higher-priced way to advertise than on other methods, but when done correctly, the advertiser can amortize his efforts over time to make them ultimately more rewarding than search ads or typical display ads.

There’s more to this debate, and there are other problems with Scoble’s criticisms, like the fact that he unnecessarily picks on Chris Pirillo throughout the whole post. I briefly chatted with Chris this afternoon, and though Robert alleges in his post that Chris doesn’t always disclose, I confirmed with Chris that he does, in-fact, disclose tweets that are sponsored and those that aren’t.

Incidentally, as Mark Suster pointed out earlier today, we all do in-stream advertising to some extent or another, though most of us usually are guilty of advertising ourselves (do you post links to your blog posts or your YouTube videos? Are those tweets strictly conversation, or is there a promotional element to them?).

The fact is, and this is true of almost all forms of online advertising, most independent content producers don’t have the momentum to pull down ads and sponsors like Scoble does. That’s why ad networks are necessary and how Google continues to exist (they make a LOT of money by being an ad network).

Certainly it undersells my capabilities as an influencer to sell my tweets for between $3-$50 a pop (which is what I get for mine). That said, until someone signs up to be my sole sponsor at a premium rate, that’s what they ala carte out to for me and a large majority of professional and independent content producers, and it continues to be the lowest-impact highest-return area of my content production efforts.

That means it’s only going to grow as an industry, because I’m not alone.