Married to Business model not their consumer: most of the content producer (music, video, tv, books, news etc) were trying to hold out with their old business model (think: buying album only or newspaper subscriptions). As new platforms emerged consumption patterns changed yet the model did not changed. In a leaked email by Jobs to Murdoch regarding e-books publishing, Jobs clearly warned that if books were not made available at price points, delivery methods and platforms to today's consumer behavior, we shouldn't be surprised to see a Napster moment in publishing industry. Those who have held stedfast in their old ways have suffered. Only now we can see some revival of music thru subscription via Apple Music and Spotify--but it took years and a lot of failed startups to get here.
Ads: Head in the sand moment: Having worked in this industry i see a few common occurrences: 1_ ad agencies have made it a point not to learn about emerging tech, actively invest in them or be the agent of innovation. Just like content industry they are happy to pick u 15% of cut from the buyer and the seller of ads, just b/c they can 2_ over last 20 years there is a steady increase in marketing budgets as a % of revenue by everyone in some cases up to 20%. Obviously CEOs will expect the CMOs to be accountable and present a ROI model vs the traditional 'sunk marketing costs'. Thats where data came into play. However, in actuality data is really being applied with very little thought.
Combination of laziness and apathy are some of the reasons for shitty ads.
What i find it intriguing if the quality of ad content is good and delivered in a meaningful ways then people wouldn't mind it (eg: Super Bowl ads).
But then again it takes a lot effort and thinking. I'm however, hopeful.
for other media, such as music, video and animation, one of the problems is that there is a barrier to creating casual content with decent production values. likewise, something like a play or a movie requires a longer-term and more coordinated effort than just someone sitting in their bedroom writing a story. but i believe that if the means of production were more accesssible, people would put in the effort for the sheer joy of creation. (doctorow's "pirate cinema" is a good read in that regard; the protagonist's art form was creating movies stitched together from clips of other movies. a true creative commons would make that a perfectly viable art form.)
note that history has plenty of examples of really good writers and painters dying in poverty. they were moved to keep creating nonetheless; it's a very powerful human drive.
the one bleak aspect to all of this is that the ability to produce art for free is biased towards people who already have another means of support, and one that leaves them both comfortably-well-off and with free time and energy. yet another way in which a basic income would enrich the world.
edit: i also feel that money-as-a-reward has a deeper problem than the fact that it's currently shackled to ads. once you bring in money (and the implicit idea that the better and more popular your work is, the more money you'll make from it), your incentive is to impose access controls on it, because if there's a way to access something either by paying for it or for free, most people will go the free route. that adds an antagonistic note to the relationship between the producer and the consumer, as well as triggering a spiral of overreach with respect to "intellectual property rights".
That is not always true. Highly specialized content, which has tiny audience, can be equally profitable. In the end, money reflects the need for the content.
it's also possible that the desire to have everything be free will trigger a worse-is-better downslide where no one creates really good content because no one will pay for it because everyone is satisfied with good-enough free content, but i doubt that will happen; i just want there to be enough good-enough free content that people who can't or won't pay still have their needs met.
while we're dreaming, there are two things i'd really like to see emerge:
1. a true shared culture with a continuous gradient from pure consumer to prolific producer. something like tumblr is a good proto-example - there are people who just browse feeds, and people who reshare, and remix, and add their own writing, and write entirely new posts, and every now and then a truly beautiful post emerges and makes its way out onto the wider web
2. a thriving distributed patronage model, where people fund the creation of a work via kickstarter etc., but then the work is released freely, having made its money already
both these things are already starting to be experimented with, but they are badly in need of mindshare.
sadly, the implicit contract was broken on both sides. people didn't want to pay for content, but they also wanted to consume (pirated) premium stuff, rather than commons material, so there was never a concerted push to have better discovery mechanisms atop the freely-provided web. likewise, producers wanted to impose user-hostile measures like drm and geographic segmentation on a medium that was not conducive to them, making piracy the more attractive option even if you didn't care about free-as-in-beer.
professional producers had to go free because it was not a case of paid professional content competing with free amateur content; it was a case of paid professional content competing with free pirated professional content. that also sucked a lot of the oxygen out of the amateur ecosystem; who wants to dig through the virtual slushpile when you can get pre-curated professional material for free?
i'm sad about the whole thing because i was really looking forward to seeing if the creative commons would compete on its own merits as a mass entertainment option. once the reward of putting something up is not people reading and appreciating it, but money from ad clicks, though, the producer's incentives are suddenly misaligned with the consumer's, and we end up with the web of today :(