Google even suggesting ads on Nest is pretty disgusting to me. When I pay for a device from a company that is where they should be getting their profit - don't bait and switch and then serve ads to me.
The biggest problem with the ad model is that it effectively kills off most chances of a paid ad-free product to exist. If you had the option to pay to not have ads, many of the better off would pay for that privilege, most of which are the very people more advertisers are trying to reach. A market that includes everyone is going to be far more valuable per set of eyeballs than one that only includes people with not much money to spend.
How exactly would I pitch this to a client?<p>Would they be text? If they're text, how would they click through? Text ads have negligible impact on recall without some sort of image. Whatever happened to context sensitivity?