matt4077 might be right actually; those who choose to pay to avoid ads are probably not broke and thus more valuable ad targets, so (some?) content creators will get greedy and double-dip by producing content steeped in product placements or equivalent. That, in turn, would undermine the idea and adoption by the willing-to-buy-out-ads segment would be low.

In-content ads are regulated in many places. You can't do it unless you explicitly mention that it is an ad.