I agree with all your points, especially 3 and 5. I think privacy can be maintained to a general degree while still giving fairly good pinpoint demographics to the ad agencies. A major problem is that most companies don't know what to do with themselves with this kind of granular view of their targets, so they go with the mass produced spray-and-pray model used for other broadcast mediums. Google, I believe, has the right idea with targeted adwords that are relevant to what the user is looking at or what they search for.
One problem I have with the ad supported model is many services don't give the user the ability to pay and do away with advertising. There are many services that DO charge the user, and you notice that they don't rely on ad revenue to support themselves. However there is very little in between the two models. Reddit has a bit of this with it's ads for free users and no ads for "Reddit Gold", or their paying accounts. I can't think of another service, off the top of my head, that does this. I believe this could be a huge boon to many publishing and news services.
One problem I have with the ad supported model is many services don't give the user the ability to pay and do away with advertising. There are many services that DO charge the user, and you notice that they don't rely on ad revenue to support themselves. However there is very little in between the two models. Reddit has a bit of this with it's ads for free users and no ads for "Reddit Gold", or their paying accounts. I can't think of another service, off the top of my head, that does this. I believe this could be a huge boon to many publishing and news services.