None of these web monetization efforts address the fact that the pool of [all consumers' discretionary income they'd be willing to spend] is likely a small fraction of the size of [all commercial companies' marketing budgets]. No matter how much you reduce the friction for having people make small tips to websites, there's just significantly less money to go around, so it can never replace advertising revenue. The only way that would change is if online advertising went away overnight, and instead of companies redirecting that to other forms of advertising, the prices of all consumer goods went down so it stayed in our collective pockets.
This kind of seems like a troubling insight at first glance, but it doesn't pass basic sanity checks imo. You could make the same exact argument about any other type of industry. Watch:
>The [pool of discretionary income people have to spend on books] is a small fraction of [all commercial companies' marketing budgets], therefore it will always be more profitable to run free bookstores that try to make money by putting ads inside the dustjackets and all along the shelves.
But this obviously isn't true - Barnes and Noble is a thing. Or you could even consider Kindles and the ebook market examples of how this isn't true. It can be far _superior_ in terms of revenue to offer a product that people pay for directly, as opposed to baiting them into a space with ads in it.
I think the mistake came in when you compared all of the marketing budgets combined, (call it M), with all of the discretionary income combined, (D), and took it as axiomatic that D << M. But... how could that possibly be true? Most companies will not be operating at a loss, which means their annual marketing budget will be some fraction of their gross revenue. From what I can tell from some googling, at least ~60% of that revenue, averaging over all corporations, is coming directly from... consumers' pocketbooks.
Some more googling tells me that marketing spend from US companies was ~$200 billion in 2018. US consumers spent $14 trillion. So the whole premise strikes me as questionable. Am I missing something?
I think what you're missing is that discretionary spending is not all spending, and marketing budgets are a percentage of all spending. When I go to CNN.com right now, I see ads for Tide pods and Toyota SUVs. That ad spend came from our supermarket and car payments, which you can't redirect to tipping websites unless you want to stop eating and driving to work.
My argument is basically that no web monetization plan that involves redirecting some of our discretionary spending towards paying websites can make up for the advertising revenue they currently get, because that ad revenue is funded by not only a portion of our discretionary spending, but a portion of ALL our spending, and the non-discretionary portion is much larger. Tide and Toyota are always going to have more money to spend on advertising than Bobby and Jill have the discretion to spend on sponsoring websites.
It's all just spending though. Tide is trying to get you to pay a little extra for the name brand over the generic. Instead of a Toyota SUV you could have picked up a used beater - or kept driving the car you have for a few more thousand miles. Netflix wants you to shell out extra "discretionary" money to watch some TV shows you don't need to see.
And millions of people do it, because they want to. If it cost money to read a a website, then people might do that too - if they deemed the content worthy of their hard-earned dollars. Millions of people already pony up $1000 for the latest smartphone so they can read stuff online at all hours of the day. I really don't think the web creators should be this worried about whether or not people actually want their stuff. They desperately want it; in fact, most people are probably literally addicted to it.
Of course, maybe you're trying to draw the distinction between paying for a good and voluntarily making a donation. If that's the case, I'm with you - the latter idea is a loser. But if popular websites just made you pay to use them, and the amount was tiny, and the actual process of paying was completely frictionless and unnoticeable in terms of the browsing experience, then people would totally do it. I think a lot of people think they learned this fundamental truth that people don't want to pay for things to read on the internet, when what they really learned is that people don't want to be interrupted and asked for their credit card details. But if you can make that process seamless, people will happily fritter away thousands clicking through links.
> But if popular websites just made you pay to use them, and the amount was tiny, and the actual process of paying was completely frictionless and unnoticeable in terms of the browsing experience, then people would totally do it.
People would maybe do it, but ads wouldn't go away because there's x times more money to be made in the ad business than people micropayments.
The main issue with Brave's funding model is that it relies on consumer goodwill. While people might be willing to spend $0.02 to read a news article, they're less likely to allocate $10/month to funding online content creators "just because". There has to be some sort of incentive for most people to spend their money; if they can get the same experience for free, only a small minority will ever bother to pay.
So the question is, how do you provide consumers with such an incentive without charging for the content itself (as that can be problematic for the reason you mentioned), without offering "an ad-free experience" for paid users (as Brave blocks ads by default regardless of whether users pay or not), and without requiring users to incur the mental load of trying to decide whether the paid experience is worth it over the free one?
I often hit the free limit on say articles on New York Times and similar sites. After seeing the article title I am often interested enough to click on it to read it. But the count of free articles is full so I can't read the article. Now if it said "If you want to read this article there will be $0.50 charge in your next month's internet bill, I would probably go ahead and click and pay it in the next bill.
Problem is I don't want to open an account with just every possible newspaper and magazine on the web. What is needed is some common mechanism for most if not all content providers.
Maybe $0.50 is too much. Maybe $0.25 would be more like ok.
Your point about having a single account is correct, but the sheer amount of decisions when browsing the web would quickly become overwhelming.
Say that in an hour you browse two articles from the NYT, one from the WSJ, five Wikipedia pages, one click on a BuzzFeed listicle, and one blog post from Joe's blog.
Is the NYT article worth $0.50? $0.25? What about the WSJ one? And surely Wikipedia is worth as much as a NYT article. But the BuzzFeed one is definitely worth less. Maybe $0.05? It was moderately entertaining after all. And what about Joe's blog?
Having to do dozens of these micro decisions per hour is exhausting, and is the whole point behind having a system that allocates funding automatically. It's not optimal, but it avoids decision fatigue.
I'n thinking that the content-provider obviously would set the price, I would decide whether to click if it is 25 or fifty cents.
I don'think it would be more exhausting than being in a bar and putting coins into the jukebox.
Automatic funding sounds interesting, was it explained in the article somewhere? Or is the point that we should use 100 million to develop a working automatic funding algorithm since no such thing exists yet?
I think the big thing is trust in the market. Consumers tend to be conservative in which parts of the market they trust. They don't want to pay for something if they have no idea if they're going to get their money's worth. With existing markets, or any market that lots of people are using, people trust that it's okay so they join. With something new, are you going to pay money to access something if you don't know if it's any good? Moving towards free+ads is always easier than towards payment up front.
That said, Netflix is incredibly successful with something new, but that also took years. Netflix worked hard on the reputation that they had the best, most interesting new TV shows that you couldn't get anywhere else. But it takes years to overcome that inertia.
General shoutout to anyone who's less lazy than me: has there been any good research on whether or not advertising increases discretionary spending, and if so by how much?
The Tide example here makes me feel a little bit weird, because Tide pods in particular are a pretty bad deal for laundry detergent. If people are buying Tide pods instead of generic laundry detergent, it seems to me that the advertising isn't just shifting money around, it's actually increasing spending. But it could just be bad instincts, I don't know of any actual real research on the topic.
Another way of phrasing this -- if Apple stopped advertising iPhones, some Apple users would shift over to Android, which (ignoring cost differences) theoretically would just mean they gave the same money to someone else. But would there be another contingent that stayed on iPhone and just stopped buying new hardware every year? How large would a contingent like that be?
A lot of advertising is not meant to increase discretionary spending, but to make you pick product A over product B when the moment comes to choose over alternatives.
At the very basic level of it, advertising is giving out the information that your product exists, because otherwise, nobody would even know its existence.
Your example for Apple is very good, it's very highly probable that some persons only switch to newer iPhones when they hear the news it exists and see the keynotes/articles about it, even though there is nothing wrong with their phone, and they may not be thinking about changing it.
> The Tide example here makes me feel a little bit weird, because Tide pods in particular are a pretty bad deal for laundry detergent.
For my wife, the pods are a lifestyle upgrade over the regular powdered pour out detergent. The convenience and effort saved justifies the more expensive packaging.
I'm a firm believer in adopting new processes or products that reduce the amount of time required to perform my daily functions. They pay off in the long run.
I think advertising increases discretionary spending, it just redirects it.
When smoking ads were banned, profits for cigarette companies went up, because they didn't have to spend money on marketing anymore. Addicts still kept buying them anyway. Previously, smoking ads were to get people to buy your brand rather than some competing brand.
But for any given business the maths work out differently. Building a dedicated audience in a niche who are willing to pay for a thing directly is easier than wrestling with the advertising industry to try and extract enough ad revenue to keep going.
> no web monetization plan that involves redirecting some of our discretionary spending towards paying websites can make up for the advertising revenue they currently get, because that ad revenue is funded by not only a portion of our discretionary spending, but a portion of ALL our spending, and the non-discretionary portion is much larger.
It kind of sounds like ads are like a pollution on the web, and we should just ban them.
What you describe is a lot like the pollution due to over packaging many products in the food industry. You can say consumers shouldn't buy it, but consumers as an aggregate can't handle that and if you want to solve the problem, it's to put less packaging on the shelves.
Similarly, if what you describe is true (and it sounds true, because how massive the internet ad industry is, indeed to me never seemed to quite add up to what people do online), then no matter what sort of monetization schemes we come up with for Internet content, most industry everywhere is still going to pollute the Internet with ads, simply because the content producers want more money, the consumer doesn't have it, but the industry marketing budgets do.
I think this is partly due to "content producers want more money", because if it's never enough you can wreck any good thing. But the other part is that "the industry" can apparently stuff the Internet full of as many ads as they want without actually being bound by how much the consumer wants to "pay" for the content via ads or (if we figure out micropayments or something) money. Because their spending budget dwarfs that of the consumer.
So, just like I always suspected, all these ads are there because the industry wants to advertise on the Internet, not because it needs to be there to pay for the content.
Content automatically becomes advertising when it exists by the virtue of a marketing budget.
Turns out this whole "your data for our content" deal, that consumers are supposedly choosing for, isn't the relevant transaction at all.
You see pretty much the same problem with outdoor advertising and store front signage. The industry has way more than enough money to spend on advertising to ruin the urban scenery with ads and giant billboards. Where I live we have regulations to keep that in check, but when I go to other countries it's really ugly. It's quite bad in the USA, but at least that country hasn't existed for very long. The saddest thing is in older countries where you see historical buildings being half-obscured or even have the billboards bolted on them. Fortunately due to tourism, there are some regulations.
Anyway, the point is that our Internet is being ruined with ads by the marketing budgets of the industry, not because the ads are necessary to support the content (they never were--there was content on the Internet before advertising, lots of it too), but simply because they have the money to put as much ads as they want onto our Internet.
It reminds me of certain cafes where they play bad commercial radio. You paid for your coffee, to sit there, but you're still subjected to over-loud ads every 15 minutes. This is not because you didn't pay enough for the coffee, it's because whoever paid for that ad has the resources to pollute the soundscape regardless of whether you pay or not.
To add to your argument: Spotify has 206 million users - almost half of which are paid subscribers.[0] This describes exactly the point of contention since free users are financing spotify through ads instead.
I think it is also plausible to assume that among the paid subscribers a higher margin are primary users of spotify for music consumption, while free users have a higher share of secondary users (relying more on vynil, CDs, limewire).
The dark side then again for example are news sites - very few of which seem to be able to finance themselves well via subscription services.
Your argument breaks down when you consider the thing that allows newspaper/web ads to be profitable is the cost of delivery effectively being reduced to zero, whereas a book still has massive printing costs that cannot be scaled as well (thousands of the same books vs. millions of the same newspapers/page views)
Alternatively if advertising became significantly less effective companies would spend less money on it. That's the upside of Ad-blocking which could theoretically make a huge impact.
> Alternatively if advertising became significantly less effective companies would spend less money on it.
What's the strategy for making advertising on Google and Facebook (+Instagram) - where the majority of all online advertising outside of China occurs - significantly less effective?
Google controls search, Android, Chrome and the Android app store (along with of course YouTube, Google Maps and Gmail, three other giant services). Facebook has its own massive walled off kingdom that exists nearly entirely in apps where they can heavily control ad blocking.
Google nearly doubled its sales in three fiscal years, from $74b to $136b. Something that big doubling in that span of time, is extraordinary. They'll probably hit near $160b in sales for 2019. I'll take the bet that a giant that large, entirely dependent on advertising, will continue to figure out how to insulate itself from ad blocking by controlling the territory around it.
Your premise will always be a non-starter so long as the ad giants control their own sprawling acreage (which they will fight to the death to retain, because it is life or death to them). The ad giants have made sure to control their own destiny, they saw the ad block threat plainly a decade ago or more and moved to stay out in front of it.
> Facebook has its own massive walled off kingdom that exists nearly entirely in apps where they can heavily control ad blocking.
True, hence the rise of DNS based content blocking like pi-hole. Sure, it is trivial for apps to workaround it by using a custom DoH impl themselves, it hasn't been done yet.
Another possibility is to patch the apps, ref YoutubeVanced
Yet another possibility is to run an app within a user-land emulator on the device and block content and deny requests. See: VirtualApp
Ad-blocking might hurt in some future with hypothetically high enough percentages of traffic.
Right now they make ads more effective (marginally). By self selection, a population with relatively low click-rates has removed themselves from having any money spent on them. This helps Google and Advertisers since right now, the volume of available impressions is plenty high, the name of the game is targeting better.
If anything, ad blockers just hurt select publishers who can potentially see a large volume of their potential ad traffic blocked.
This sounds completely reasonable to me, and I don't know where it's wrong, but it doesn't square with my experience and I think it's wrong.
If this were true, nobody would be getting mad about ad blockers. But both advertisers and publishers (big and small) regularly complain about ad blockers, and even with a relatively small portion of users installing a blocker, multiple journalism sites have started adding paywalls. This paranoia isn't restricted to small sites either -- Google's even listed ad blockers as a potential revenue problem in investor disclosures.
A couple of potential causes: maybe it's that impressions actually do matter to revenue in some cases and we haven't completely moved over to conversions yet, or maybe it's that advertising increases consumer spending even without direct conversion rates, or that most publishers are engaged in fraud and ad-blockers make it harder to do that. It might even just be that publishers/advertisers are all stupid and haven't realized that ad blockers don't matter, but I think that's unlikely.
What seems plausible to me is that most of the people who block ads are not as immune to advertising as they claim. If they didn't block ads, they would occasionally click on an ad and provide a conversion. I would not be surprised to see that exposure to advertising increased overall spending, and didn't just redirect it to specific companies. I could be wrong though, maybe it's something else. I'd be interested to see research on that kind of thing.
Regardless, it is very difficult for me to square the world you describe with a world where a huge fraction of news sites I visit are including banners that tell people to whitelist ads, or anti-adblocking technology outright, or are just giving up and switching to subscription models. I can't think of an explanation for that other than, "ad blockers decrease revenue", and I think that having an explanation for that behavior is a prerequisite to making a believable claim that ad blockers aren't hurting revenue right now.
I mean, Google's not dumb. They would not have wasted time on the acceptable ads initiative if they didn't feel like they needed to.
Publishers definitely get hurt hardest because volume and quality of traffic is more important for them, less so for exchanges. They're the ones who are the "huge fraction of news sites [you] visit [that are] including banners that tell people to whitelist ads, or anti-adblocking technology outright".
> maybe it's that impressions actually do matter to revenue in some cases and we haven't completely moved over to conversions yet, or maybe it's that advertising increases consumer spending even without direct conversion rates,
I mean you're right. Branding campaign spend just wants to eat up impressions and don't care much for click or actions. They're a large amount of $$ spent, but they also benefit the least from tracking so they can basically be shown to anyone. Tons of available inventory for them. But there's tons of money in more targeted CPA, CPC ads too.
Disclaimer: I mostly knew things from the RTB angle maybe 3 years ago. I may be out of date with where things are at.
I always thought that the big problem for advertisers was who blocks ads. Adwords stopped being effective for me years ago, looking back I assume that's because I sell to a technical audience who are most likely to run adblockers.
I wonder if that applies to income as well, are people with higher purchasing power more likely to block ads. My gut feeling is yes.
Some banners ads are not all of advertising. You’re affected by numerous channels and mediums that would pick up the slack (and already have) from adblocking on the web.
If advertising moves off of the web onto other channels and mediums, then necessarily the economics of the web would still change, right? Taking revenue away from a single medium will still alter the economics of that medium.
Mozilla isn't trying to change the economics of the entire market, they're trying to change the economics of specifically web content.
Sure, if that actually happened, but the comment was that ad blocking could do it.
In reality, ad-blocking is already priced in and slowly being recovered. All it did was create a new addressable segment of tech-savvy/ad-resistant consumers. The slack is now recovered in first-party walled-garden platforms, native advertising, "influencer" and other underground techniques.
Adding to this, in the same way that privacy specialists struggle to convince the public of the supreme importance of security and privacy, it's difficult for superusers to appreciate the general public's feelings about the trade-offs of advertising—in other words, the general public might never care.
(Mozilla's campaign is a form of activism by superusers, for superusers.)
You are assuming that any effort will be trying to break the advertising paradigm in favour of a direct payment one.
The article/grant doesn't seem to be about that. Whatever the business model, this seems to be more about breaking platform capture than breaking business model. The alphabook platforms particularly.
Ultimately it's a big field. We have direct payment models (netflix, spotify, iTunes, kindle...), ad-suported models and quite a lot of online content production where monetisation is secondary to distribution.
I think it's a good time for this initiative. YouTubers (for example) with millions viewers can (a) make very little money (b) chaffe at various policies, either money or content related and (c) generally have far less power vis-a-vis alphabook than their audience size implies.
Meanwhile, podcasts, a much freer medium, is both more profitable and quality oriented because of the platform openness.
...open doesn't mean no advertising. The main thing it means is decentralised, or centered around content creators.
This a a good idea. YouTube is no longer necessary. If it suddenly disappeared, online video content would quickly recover fully around alternatives. They contribute the least value while extracting the most.
> Meanwhile, podcasts, a much freer medium, is both more profitable and quality oriented because of the platform openness.
I don't think this is true. Podcasts are more profitable since their production costs are lower, their audience skews wealthy and its inherently easier to make longer audio content, so it's possible to put more ads in.
Nothing is stopping YouTubers from not using the default ads and getting their own sponsors.
The web was fine without these commercial companies. Not like their content added a ton of value to the web. The news is mostly propaganda anyhow, belonging to various wealthy parties that want people to pay for their propaganda... If they funded it completely out of pocket, that would be a more honest approach to these "businesses".
The other companies like FB, they took bunch of content that belonged to users that users had tools to publish for free and willingly put them in silos.
There is maybe 1% of content that needs saving. The rest of it is the same sort of drivel that you get from tabloids and I say making that stuff economic non-viable is a good thing. The elites though care about making it work because otherwise the democratic media is "fake news", meaning news heavily slanted to what people want to believe rather than what they are told to believe. If you want that, then they should pay for it. Not the people through taxes as Bernie is proposing... or this scheme.
Other than that we have good models like BBC or PBS on how to do independent government and publically funded programming.
In fact if we re-engineered the web so that there was no data sharing between various systems on the frontend, something like everything has to be served from the same canonical domain, and put it in law that you could not share data between various private companies on the backend without heavy regulation and oversight that would be a better web. I mean prism is already sharing all this data, why don't we put controls on that?
The web was hands-down better when most content was made by hobbyists without a profit motive. I used to be able to spend countless hours online. Now it's rare for me to stumble across anything worth looking at. Granted, it's easier to search for and find specific information.
Totally, just like so many bands were better young, clubs, beaches and restaurants better before they got popular, etc. Unfortunately it's just something that happens when things get mainstream, you can't reverse the process.
Not sure what you are talking about, can you quote what you mean? No one gets to decide, I mean personal information being shared between companies on the backend. That should be heavily monitored with oversight. Like the sites you visited, etc.
> [all consumers' discretionary income they'd be willing to spend] is likely a small fraction of the size of [all commercial companies' marketing budgets]
Assuming you meant all spending, this cannot be true, because all marketing budgets are paid out of people's spending. You are paying for advertisements, they are included in prices of goods and services you buy.
I can't forego buying food and housing and medication so that I can reallocate "what I pay for advertisements" to tipping websites. If there's less advertising inventory available on websites, P&G is going to reallocate that spend to some other form of advertising, they're not going to drop the price of the shampoo and toilet paper I buy from them. The money's not in my pocket to spend, it's in theirs.
You can reallocate. Only top tier brands use ads, and the price of the advertising is part of the premium you pay for the brand name. For a lot of products, there's no functional difference with their cheaper alternatives.
So, this brand premium is in fact discretionary spending that you could reallocate.
This is kind of an academic point. "Reshaping the economics of the web" probably shouldn't involve assuming all consumers will want to change what brand of laundry detergent they buy so they can read more blogs.
Why not ? Amazon has launched an offer where you can pay to access all kind of otherwise paywall gated media content (Amazon video and music and twitch prime etc) while also having 2 day delivery on a set of retail products not necessarily including your prefered brand. And people subscribe to Amazon, which finances the said media content, all the while changing their laundry detergent of choice.
I don't say this must be a direct rational choice, but it's already kind of happening in some places.
It can be true if people spend more than they think they are willing to spend on content via advertisements. That is, people underestimate how much advertisements affect them. And of course there are people who simply block advertisements.
Either that, or advertisers overestimate the impact of online advertising.
marketing pays itself to an extent through increased revenue and scale. Historically, companies have spent more or less the same percentage of their revenue on marketing. It seems they find an equilibrium
> the pool of [all consumers' discretionary income] is likely a small fraction of the pool of [all commercial companies' marketing budgets].
"Discretionary income" is a short-term idea, defined as [income - cost to maintain current lifestyle]. Over longer periods, lifestyles expand to fit current income and the idea is meaningless.
For instance, when cars were new, people could only buy them if they had a large chunk of discretionary income to spend on them. But now, most middle-class people own a car that costs more than their discretionary income. So discretionary income isn't a cap on what people can spend in the long term.
Discretionary income is measured in dollars/time, cars are valued in dollars. That’s relevant because cars are affordable to middle class Americans because of _financing_ (also because of mass production). Your car payment deducts from your discretionary spending while web advertising does not—without web advertising you would need to subscribe to the websites and services you consume and that would come from your discretionary dollars. Whatever your views on the matter, getting rid of advertising isn’t going to come for free.
That may be true. But I have no clue where those marketing expenditures go. I do recall reading about major firms realizing that most of their marketing expenditures more or less accomplished nothing.
From a bottom-up perspective, I've read that ad income is typically on the order of $0.01-$0.10 per page view. As a more or less middle-class American, I'd be willing to pay that. Or at least, I would if ad blockers stopped working.
And while that wouldn't be affordable for most people worldwide, I'm sure that there's some way to normalize by user geolocation. In fact, I wouldn't be surprised if ad payments aren't already normalized by user geolocation.
My thoughts as well. Between GDPR making current ad models harder to pull off and more risky and the fact that ads are getting less effective I think I might see an advertising bubble:
Here are my thoughts, comments on why this is wrong are welcome: the market for online ads seems to have been growing more than consumers disposable income for two decades.
Much of that might have come from cannibalizing other forms of advertising, but sooner or later it can't grow anymore as a new equilibrium has been reached between TV ads and online ads and consumers don't have more money to spend anyway.
I remember an old blog post from Google or something showing a whiteboard with crazy thoughts: what if we could have a mirror behind the earth to reflect sunlight and make the day longer? Then people could spend more time searching => more ad impressions => more revenue.
I feel we are at that point now, only consumers have enough time to browse, they just can't buy more than they already do (and some markets might be even beyond that point, fueled by credit card debt etc.)
I've argued this point before, and have hoped for comments from people who run ad-supported blogs. Or manage larger commercial sites. Just to see if my estimate low-balls ad income. But no ...
I do believe that we're in an ad bubble. For one thing, I've read that it's hard to measure effectiveness. You can look at revenue vs ad spending. But so many other factors affect revenue. Some you have measures for, such as how the economy's doing.
But for others there's no public data. Such as ad spending by competitors. You can measure that directly, or buy data from firms that do. I gather that's a key use for VPN services with residential IP blocks.
And then there's the fact that you're typically running multiple ad campaigns. So it may not be obvious which of them actually increased revenue.
Bottom line, I suspect that firms have been throwing money at online advertising. Either blindly, or seduced by bullshit from ad management firms. And so it's entirely possible that total ad spending is greater than users' discretionary income.
But if that disappeared, and was replaced by user micropayments, I doubt that all sites would be impacted equally. HN and Wilders wouldn't be impacted at all, for example, because they don't run "ads" per se. And popular sites generally could probably earn as much as they do now from ads. At least, if their paywalls couldn't be gamed.
So is there anything that would disappear that's valuable? I can't imagine that anyone would miss ad-supported link farms, for example.
> the fact that the pool of [all consumers' discretionary income they'd be willing to spend] is likely a small fraction of the size of [all commercial companies' marketing budgets].
I don't understand this statement. The companies marketing to people with discretionary income presumably get their revenues from that discretionary income. So mathematically their marketing budget would have to be smaller than the revenue from these people.
> presumably get their revenues from that discretionary income
This is where you made a mistake. Their revenues comes from spending on necessities, not from discretionary income. Proctor & Gamble's $7 billion a year in advertising is coming from our buying soap and laundry detergent and toilet paper, not what you have left over for movie tickets. The $30 billion a year in medical marketing is coming from insulin and blood pressure pills, not your Netflix subscription. Most consumer spending is on necessities (food, housing, car payment, health/auto/home insurance, mortgage interest, fuel, etc) and those companies do the bulk of the advertising. People cannot choose to spend that money tipping websites instead unless they stop eating, stop taking medication, etc.
I don't think that distinction is precise enough for this. Sure soap is a necessity, but if you buy some premium fancy soap from P&G that had a lot of marketing budget contributing to its high cost rather than the supermarket brand plain soap, then plenty of that soap money was discretionary.
This extra precision doesn't change anything. None of the proposed alternative monetization schemes have suggested you buy a cheaper brand of soap so that you can put another nickel of discretionary income into tipping websites. Even some of the money you spend on the generic store brand ends up in someone's marketing budget.
By [all consumers' discretionary income they'd be willing to spend] I think the parent meant [all consumers' discretionary income they'd be willing to spend on web content] which is obviously a subset of all their discretionary income. Marketers are peddling tangible useful items, and people will pay a lot more for that than for the ability to read given words on the internet.
That first sentence took me a little while to wrap my head around and I don't think it's true or logical. In other words, even if it was true, I don't see why it matters.
I'm building a company that plans to charge people to read things. The reading experience, without ads, is superior. It's worth paying for. That means that an ad free future is possible.
You may think it's worth paying for, but your average consume will not. It makes sense from a consumer point of view, how am I to know if this "superior" experience is worth my money if I haven't tried it. How do I know it will stay that way, lots of magazines and newspapers quality tanked after they got high subscription numbers.
"Did you see that new Thai joint opened up down the street? I heard it was pretty good. Want to try it out?"
"And just how are we to know for _sure_ that this trumped up restaurant is truly superior?"
In other words, this is how capitalism works. Businesses and vendors make value propositions, then people take chances on them. It works for every single other class of good, but for some reason the big brains that run the internet can't wrap their head around how it would work for them.
Some people have understood this, and they're making a killing from it. For instance, which do you watch more of, HBO, Hulu, Prime and Netflix or broadcast TV? Tons and tons of people are happy to shell out cash for products they consider worth it.
Newspapers and magazines have tried to convince us that these asshole millenials refuse to pay for things anymore, but what they mean is they refuse to pay for shitty things. They're actually perfectly happy to OVERpay for things they like. It just turns out newspapers and magazines aren't, you know, worth that much.
Forget the average consumer...it's pretty much guaranteed there will be an outline.com link posted on any paywalled article on HN (along with the usual paywall complaint) and this crowd seems to fancy itself above the average consumer.
Maybe your business attracts customers now because they have a lot of discretionary income to spend on it, but if other services that are a higher priority to your users start to find a subscription model to be more valuable than an ad model (because ad blocking is too effective, for example), your customers will have less discretionary income to put to ad-free reading. Further, all of those ad-subsidized reading sites now become your competition.
This isn’t a pro-ads argument, but an appeal to sober, informed debate.
I think you’re right, there is definitely room for consumer-funded content in the market - and I wish you the best in your endeavors.
But I think suggesting an ad-free future is a leap, not least because paid content platforms need to do marketing. Why do you have a Netflix subscription? Because you heard they had some good shows? how do you know what shows they have before you subscribe?
Why does it not adress it? It is also about changing the mindset of people. Make it easier -> make it more common to voluntarily pay for thing you value -> more projects are financed that way -> more people see it is a way to make a living -> better content -> more people willing to pay, especially seeing the difference to normal ad madness
Nothing in that feedback loop will allow people to spend money they don't have. A big chunk of the money you spend on groceries, car payments, insurance, medication, etc is going into those companies' marketing budgets, and that ends up as the ad revenue that finances the web today. You don't have that money to give to website owners directly instead, as you've already spent it on those goods.
Marketing makes people buy plenty of things they don't really need nor want. If people choose not to be exposed to tailored ads so much, they would have this money to spend for other things, like paying directly to support what thes want and not the long route indirectly and ineffectivly via ads.
Most marketing is for necessities, to steer which brand you decide to buy, not to make you buy a category of product you wouldn't buy otherwise. You need soap, they just want it to be Dawn soap. You need laundry detergent, they just want it to be Tide detergent. Etc etc. You're not going to stop buying food, soap, medication, gas, etc so that you can direct that money to tipping websites instead.
I do not agree with your premise. The amounts that companies make of blatantly selling out your data to be abused is often much lower than I would be willing to pay.
I pay for YouTube Premium primarily to get rid of the adds. I stopped using Facebook in 2017, but if I used it I would gladly pay the single digit dollars per year they seemed to make of me.
Now where i do agree is that even with people paying for content and services directly, advertizing would creep back in, because it would always be a potential supplementary revenue stream just sitting there tempting the content or service providers. This is where we need strong regulation such as the GDPR enforced to stem this general race to the bottom.
Facebook's ad revenue for 2018 was $55.8 billion from 2.7 billion MAU. That means each user is worth $20.67 per year. In reality, not all users are worth the same, and as an English speaker, you're probably worth at least double the average. So, figure $40 a year to remove ads from Facebook, not single digits. Now what about the other 10,000 websites you touch each month?
About $50/month for a family plan should be fine for a completely add free internet. How that fee is distributed across the different sites I visit is an administrative issue.
I'd extend that to all advertising and I think we might be out of this mess permanently.
It seems like an insane concept, because advertising is a part of modern life, but I think it's the only way to effectively kill the surveillance/influence peddling hydra.
Otherwise, all these efforts just redirect ad dollars to other forms of systems of influence which may be similarly as invasive.
Everyone can have their own definition, and allow me to present my own.
Advertising is any unsolicited communication about a product/service.
That covers ads on webpages, billboards, TV ads, radio ads, youtube ads, someone yelling at you in the street about their product/service.
I didn't look for that info, so I don't want it. You and your product/service can fuck off.
"Advertising" that I do not object to is where the "customer" actually looked for it. Here are some examples of that: Displaying a list of products/services that you provide on your _own_ website that people can look for. Entries in the Yellow pages or something similar. Like for example (unpaid) search results.
If I am looking for a plumber, then I can look in the Yellow pages and see a list. And I won't get pissed off because it's what I wanted. Or I can google plumbers, and get a list of websites in the search results, and then click on the links and view their websites where they describe their products/services. I also won't get pissed off by this, because I was looking for it and no one shoved it down my throat.
I agree with AndrewKemendo that advertising (as I have described above) is insane and needs to go away. It has no place in a civilized society. There is literally no difference between advertising (as per my definition) and spam. I would go so far as to call it harassment.
This is the same as saying "Define Pornography." You're asking for a bulletproof formula that doesn't exist. That doesn't mean we can't take a pretty good bite out of it.
How about this: Any action taken by an individual or organization with the intent of influencing another individual to execute a commercial transaction.
No billboards, TV commercials, newspaper advertisements, hyperbolic statements about products. I'm sure some wacky new loophole would be found, but it would be just that, some wacky loophole, not a massive trillion dollar industry built around manipulation.
> Any action taken by an individual or organization with the intent of influencing another individual to execute a commercial transaction.
That definition pretty much boils down to every interaction between businesses and individuals, ever. Any kind of negotiating or sales or communication..
Correct. Like I said, it's pervasive to the extent that we just assume it's the only way it could be, but it's behind every terrible thing.
I know this first hand, I built these systems. The end state is to know and predict everything you do, and then sell you something about it. Whether its a product or an experience or a feeling. That's where it all leads - you lose your agency. Getting rid of online marketing or nudging it one direction or the other won't really change it. You can ban it online outright, but it will persist in another form.
Our entire world economy is based on different groups vying for your attention to monetize, to the point that as we go further, nothing is not monetizable.
I've worked with small businesses - the small one to thirty person plummer or photographer or decorator type. What you're asking for is fundamentally impossible. Business and entrepreneurship is a human process where two entities find a transaction that benefits them both.
Of course this breaks down when shady actors manipulate in bad faith, but that's the price of freedom. To put a ban into place as extensive as you're suggesting would be to regulate speech as far as I'm concerned.
Not really. I understand your complaint, but what you're saying would kill entrepreneurship. How else can companies compete if they're not even allowed to go 'hey, I think we've got a better solution at a lower price'.
