Ads can be made less annoying by targeting them well. But the major problem is that annoying advertisement and spam works. Even though a bulk of them fall on deaf ears, the benefit, that a small percentage of them initiates a sale, more than compensates for the costs. That, followed by the other property that ads can persuade people to buy things that they dont really need, makes it unlikely that annoying ads are not going to go away soon. Companies will continue to have an incentive to show ads to people who don't really need that stuff or have interest in that stuff.

Effectively, the target becomes not that population who will not be annoyed, but the population that can be persuaded to buy with a profitably high probability. The operating point will largely be dictated by the cost of delivery and probability of conversion. Competition sort of guarantees that the former is driven lower and lower.

So far, the loophole has been that the advertisers are not charged an annoyance fee that is over and above the delivery cost. But as treelovinhippie suggests once they start getting charged, things will change.