This Cringely article got me thinking.
A friend forwarded me an article on using P2P to distribute a failed TV pilot - http://www.wired.com/news/digiwood/0,1412,67986,00.html
It's brought up an interesting idea to me:
The FCC has rules apply to television, but not to digital broadcasts or videos shared via P2P. Everyone likes widescreen (well everyone except my aunt who thinks that the top and bottom are now missing). That's a lot of deadspace (like 20+% of the screen). If you dropped static ads into the deadspace above and below a widescreen broadcast, you could run them throughout the whole broadcast. No ad breaks, but ad banners, like the bugs that UPN and others run all the time. That would raise the hackles of the FCC but its a non-issue on the Wild West Web.
If you host a video download, you have to pay through the nose for bandwidth. Even if you post a crappy quality 200MB 1hr. show, every five downloads is a gig of bandwidth. At $1/GB, that's 20 cents per viewer. If PBS had to pay 20 cent per viewer per hour to broadcast (forget about production), they couldn't do it.
If you released a show via P2P with ad banners in the deadspace, you could get money from the advertisers but not the users (like commercial TV). You would have to pay something for bandwidth to seed it, but only a fraction of full fledged video serving.
Late in the season of the show, you start running new banners: "Season 1 on DVD July 5th-- no banners, no downloads!" Firefly and Family Guy are two examples of how a show can find new life via DVD.
There are downsides that could doom this concept: people might not like the banners. Will they like them more or less than the ad interuptions? Hard to say. We're used to the interuptions. How do you measure the success of the banners? There is no way to get metrics on those banners and right now there is only a limited capability to hook content on a video into a hyperlink, so that's impractical.
Another friend has an idea to start an adult video company (best of luck). If he were to follow this model, he could take a popular but fringe genre and sell ads from people who aren't used to the light of day (like other businesses in the adult industries). The reaction would be like that of Joey and Chandler in that Friends episode: Free porn!