It seems to me that a centralized blogging platform[1], that did its own analytics on the people browsing each blog, but also had enough information about each blogger's identity (perhaps through API access to their Facebooks, Twitters, G+s &c) to determine their likely audience, would be able to do very good with ad sales and placement, perhaps much better than Facebook itself (because if you're looking at Bob's wall, you aren't in a buying mood, but if you're looking at Bob's review of something on his blog, you are.)
The only problem with this is putting ads on what people think of as "their" blog. People want to be able to run their own ads on "their" blogs; even if they're hosted with some other service, they want to be the ones making money off people seeing their own content on their own pages.
I think Tumblr might be closest to a solution here (though even they haven't grasped it yet): once you can get people to read the blogs you host through a centralized interface (their "dashboard", effectively an RSS reader), you can display ads beside/between/around those posts that you think are relevant to those posts--and because the viewer never ends up going to the blogger's site itself, the blogger doesn't feel slighted by the ads + lack of revenue. They're not showing up on their site, after all.
[1] You can debate the other pros and cons of centralized/decentralized blogging--there are many--but "makes enough money for the people doing the centralizing to offer blog-hosting as a free service, and blog consumption with a streamlined and enjoyable UX" is definitely one of the pros of centralization.
>The only problem with this is putting ads on what people think of as "their" blog. People want to be able to run their own ads on "their" blogs; even if they're hosted with some other service, they want to be the ones making money off people seeing their own content on their own pages.
I don't see why that would be a problem. So you share the revenue with them, which the bloggers are happy to do because you're providing all the analytics and economies of scale they don't have right now.
A lot of the people who would be providing content for your blog-hosting service (that is, blogging), aren't necessarily in a legal position to receive money. 8-year-olds, for instance, or people living in countries where it is terribly expensive to set up a bank account that can accept internatonal payments, or even people staying in the US on Student visas who are obligated to not earn any income while they're here.
And yet, if you say "well, we'll only give you your cut if-and-when you jump through all the legal hoops yourself so we can just send it without worrying or doing too much work", these people will get mad that you're withholding "their" money, move their blogs elsewhere, tell all their readers that you're stonewalling lazy moneygrubbers ("you're just like Paypal!" they'll say), etc.
>And yet, if you say "well, we'll only give you your cut if-and-when you jump through all the legal hoops yourself so we can just send it without worrying or doing too much work", these people will get mad that you're withholding "their" money, move their blogs elsewhere, tell all their readers that you're stonewalling lazy moneygrubbers ("you're just like Paypal!" they'll say), etc.
I don't understand how "give us a routing number and we'll deposit the money into your checking account" is particularly arduous. If you live in a country that makes payments difficult, what do you expect a blogging platform to do about it? You'll encounter the same issue from any ad network who might pay you to put ads on your own unaffiliated blog. If you want that fixed you have to lobby your government to fix it, or move to another country.
In addition to that, Paypal has to deal with an army of international scammers and Paypal are cheap/lazy bastards who would rather screw over their users than devise elegant solutions to those problems. But almost all of those problems are a result of Paypal withdrawing money from one account and depositing it into another. A blogging platform doesn't do that: They get money from advertisers, who are happy when their ads are shown to users who buy stuff regardless of the are-you-a-dog status of individual bloggers, and deposit the money into the accounts that said bloggers have asked it to be deposited into. There is nowhere near the same opportunity to steal anyone else's money in the traditional method of signing up for a scam account and taking payments for goods or services you never intend to deliver, so the level of dickishness required to run the operation is substantially reduced.
The only problem with this is putting ads on what people think of as "their" blog. People want to be able to run their own ads on "their" blogs; even if they're hosted with some other service, they want to be the ones making money off people seeing their own content on their own pages.
I think Tumblr might be closest to a solution here (though even they haven't grasped it yet): once you can get people to read the blogs you host through a centralized interface (their "dashboard", effectively an RSS reader), you can display ads beside/between/around those posts that you think are relevant to those posts--and because the viewer never ends up going to the blogger's site itself, the blogger doesn't feel slighted by the ads + lack of revenue. They're not showing up on their site, after all.
[1] You can debate the other pros and cons of centralized/decentralized blogging--there are many--but "makes enough money for the people doing the centralizing to offer blog-hosting as a free service, and blog consumption with a streamlined and enjoyable UX" is definitely one of the pros of centralization.