This past week, Microsoft announced that it will help bring free wireless to Portland, Oregon as a start to a new initiative it aims to roll out to other municipalities. In exchange, the software giant everyone loves to hate will get traffic to its MSN properties, and advertising revenue.

This isn't the first time we've heard about ad-supported wi-fi. Earlier this year, Google entered the arena with a similar proposal for San Francisco.

This after Google began monetizing its web properties--and other people's (including Betterhumans')--with search and contextual advertising, in the process going from a search engine everyone used, to a massive revenue-generating machine that everyone wanted a piece of--shares closed yesterday at $498.79.

All of this is part of an interesting trend. As we move further towards an information-based society, advertising has proliferated, with advertising support being the one revenue model that seems able to support free services such as search engines and web publications. With the notable exception of dating sites and porn sites, there are few online services for which people are willing to pay a subscription fee.

I believe this reflects the intangibility of such offerings, and some underlying sociological and psychological law. As the degree to which an item's tangibility and essentiality decreases, the amount people will pay for it goes down, and the amount of advertising needed to support it goes up. So it should come as no surprise that as the number of unessential, intangible information products go up--think YouTube, which sold recently for more than a billion dollars--so too will the amount of advertising. 

All of this suggests that Ray Kurzweil's Law of Accelerating Returns forecasts not only an exponential increase in the power and pervasiveness of information technology, but also in the amount and pervasiveness of advertising. In fact, the technological singularity may be funded by advertising. Accelerating change, brought to you by Kleenex.

One caveat here is that I work in the advertising industry, so my perspective may be skewed. But I don't think in any way that invalidates the observation.

Some might point out, however, that people are willing to pay for high-value, intangible informational items such as prestigious journals. But the reality is, the bulk of revenue for such journals comes from institutions, and less frequently by individual professionals. And in both cases, they are business write-offs, meaning the amount people pay for them does not represent their true dollar value. 

So what does it all mean? Well, for one thing, it's starting to feel as if there's more advertising in the world than actual products, although this obviously can't be true. But I think it would be interesting to explore how the ratio between advertising spending and revenue from the purchase of goods and services has changed over time. 

One thing's for sure: advertising isn't going away. Perhaps the best we can hope for is a high-degree of advertising quality, honesty and usefulness. The last thing anyone wants, if advertising growth paces accelerating technological change, is more bad beer commercials.