This idea is as inevitable as it's horrible. It amazes me just how much of the web is supported by "ads". And the depths to which a company will sink in order to increase their ad revenue. And just when you think we have hit rock bottom, a new company will dig to greater depths.
I find the whole soft white underbelly of internet advertising interesting in that pollutes the entire advertising pool. Even ads that are "legitimate" are lost in a sea of click bait and click fraud and morass that is covered in the article.
It makes me wonder about companies that get a large part of their income from advertising (Google...). Once the ad market descends into a cesspool that no legitmate company will dip their toe into, can companies that depend on advertising revenue survive on the self-serving, artificial, and mostly automated, ad market?
A possible endgame of this quest for growth is just mixing unlabeled ads directly in with search content. Effectively pay for ranking with some quality filter. I'm pretty sure it won't come to that, but worse things have happened.
Are web ads really going to be this valuable in a generation? Even now, most tech savvy people are so used to the omnipresent nature of goole ads that they ignore them by nature. I can't even remember the last time I clicked on a google ad or any ad for that matter! If we add real means to block ads (mozilla add ons for example) to this subconcious rejection of advertising one can see that, in at most a generation, the viability of ad based businesses will be tenuous at best.
Take the example of the Sprint ad which featured 3 guys dancing in the office. A majority of us watched, a majority probably even liked the ad, but I'll bet very few switched over. As technology and information become more pervasive, it's going to be harder and harder to sell a bad or second class product no matter how good your marketing team is. Better to spend those precious dollars on designing a top notch product and let the consumers be your advertisers.
I've been waiting so long for it to be a bubble that pops, web ads just can't be worth that much when they are so bad.
I see some "captive" ads now, and I can imagine those are worth so much more - for example instagram play-between ads. No wonder the open web is dying.
I'm still waiting for the day when advertisers realise they've been sinking millions and millions of dollars into a garbage industry.
Think of all the industries tied up into advertising, and how basic ad-money is to keeping on the lights of the modern internet! Google, Facebook, YouTube, Twitter, it's all ad-money, where will it all go if the ad-money dries up?
I am deeply concerned about the increasing quantity and intrusiveness of website advertisements.
Not that I and others find them unpleasant or obtrusive. I am convinced that today's ads are a "coal mine canary", warning us of impending economic collapse.
Via HN I recently found a chart of advertising spend as a proportion of the GDP since the 1920s or so. It is just about always 2%. So if the economy is booming, then advertising will boom in a sense, but only in a strictly limited way.
It is very easy to make a new website, it is not hard at all to attract people to it, but it is quite difficult to come up with ways to monetize a website other than by publishing ads.
Consider eCommerce - you need warehouses, people to ship the product, you have to deal with payment processing, keeping Kevin Mitnick out, backing up your DB.
My own site mostly has articles and essays. When I first tried AdSense in 2004, within just a couple of hours I could tell that I would earn three grand that month. Registering for then implementing AdSense was quite a lot easier than than selling physical products.
The total number of websites is growing far faster than either the GDP or the population, thereby yielding less and less advertising money per web page.
Typically, webmasters try harder to convince visitors to their sites to click their ads. Hence we have "Like us on Facebook" popups before we can even determine whether we actually _do_ like the content.
This House Of Cards is going to break down - and _soon_. I myself recently installed Privacy Badger and NoScript; I blackhole analytics servers in my hosts file: "127.0.0.1 www.google-analytics.com".
My own website would be an acceptable solution for some: I don't use it directly to earn money. I work as a coder, however my site helps me to promote my consulting services.
But there are many sites that are quite costly to operate. There isn't much they can do to cut those costs.
From observing the hostility towards advertising on the web grow and become mainstream through the adoption of ad blockers, and ad-driven sites (like Youtube) seeming more and more desperate to actually find profitability through advertising. It seems to me that we're approaching a watershed where advertising on the web just stops being effective.
And at least, on the web, sites can enforce some degree of control over content and have a monetization strategy in place. With a decentralized platform, it's more difficult to integrate and guarantee the efficacy of advertising because it's more difficult to control the platform and user experience.
The people spamming bigger dick pills, viagra, and the like back in the day made money, and in some cases quite substantial amounts of it. They did so simply for the fact that even if 99.9999% of people didn't go for it, that 0.00001% was far more than enough to show a healthy profit after 'advertising' costs.
The point is that advertising won't end until the formula of additional_ad_driven_revenue > ad_costs becomes false. And we're a long ways away from that given how inordinately expensive advertising is relative to the costs incurred by the companies selling the advertising. And each time that equilibrium price goes lower, the potential market of advertisers who may purchase ads grows.
This logic suggests that, if anything, advertising will get even worse as ad revenues decline. Go low enough and we'll be right back to square one with Google Ads promoting big dick pills and viagra. That's to say nothing of the fact that as revenues decline, both Google and advertisers will be looking for ever more insidious and forceful ways to make you watch and make you consume. Imagine, for instance, the countless dystopias things like Google Nest could enable - if such products ever managed to gain widespread adoption.
The problem is that internet advertising as a model for 99% of companies (Facebook, Google, and a handful of others making it work being the exceptions) is fundamentally broken. When you're a media company you fundamentally trade on people's attention and advertisers pay you to get a piece. You can do that with great content, or with dark patterns and manipulation. Usually its some combination of both. Regardless the vast majority of the web needs a new business model, but I'm not sure what the answer is.
I guess you're new here. Personally, after 20+ years working in SF, I think that's a perfectly plausible outcome. I mean, the whole internet ad market has been a long slide to being as awful as they can get away with. The median investor cares much, much, much more about ROI than how that return is achieved. And a common outcome for content companies that aren't stars but have nonzero revenue is to end up as zombies that do anything that juices income a bit.
I agree with you that the ad models which are all about maximizing engagement are a problem, but I think that the article is trying to say that those sorts of models are inevitable given how the internet works. Like suppose no websites did ads at all and they all worked on a subscription model or something similar. Then you'd still have websites trying to get more eyeballs, because more attention means more subscribers. No matter what the model, for a given media source, more users means more money. And if you're trying to get more eyeballs, you'll end up with clickbait and attention seeking, a flood of information and misinformation, and we'd be back where we started.
I am deeply concerned about the increasing quantity and intrusiveness of ads.
Not simply because I find them unpleasant or obtrusive, or that others do. Rather I am convinced that they are a "coal mine canary" that is warning us of impending economic collapse.
A few days ago, via HN I found a chart of advertising spend as a proportion of the GDP since the 1920s or so. It is just about always 2%. So if the economy is booming, then advertising will boom in a sense, but at no more than 2% of the economy.
The problem we've got is that it is very easy to make a new website, and it is not hard at all to attract people to it, however it is quite difficult to come up with ways to monetize a website other than by publishing ads.
Consider eCommerce - you need warehouses, people to ship the product, you have to deal with charging credit cards and so on.
But sites like mine, I just publish lots of articles and essays. When I first tried adsense, within just a couple of hours I could tell that I would earn three grand that month. Signing up for adsense then implementing it in my website was quite a lot easier than it would have been to monetize my site by selling a physical product.
Key to my concern is that the number of websites is growing far faster than either the GDP or the population. So there is less and less advertising money to go around.
The typical response is to try harder to convince visitors to your site to click your ads. Hence we have what I first complained about - "Like us on Facebook" before I can even find out whether I actually do like the content.
Eventually this house of cards is going to break down, in my specific case I have installed Privacy Badger and noscript, and I also blackhole analytics servers in my hosts file: "127.0.0.1 www.google-analytics.com".
In many respects a good solution is to operate a website just like my own: I don't use it to earn money. I earn money by working as a coder, however my site helps me to promote myself.
But there are many sites with very sizeable costs. Look how much it costs to serve Facebook.
I'll concede that the analysis isn't completely without merit, but having spent the last few years in ad tech, I sincerely hope that there won't be a revival. It's a race to the bottom. Publishers are struggling and are increasingly willing to accept ever more outrageous ad products. Advertisers are desperate for advertising that actually works, but will mostly only do what agencies tell them, and the agencies are only interested in maximizing their own margins. In the middle we've got any number of middle men scrambling for some pieces of the cake, sometimes but usually not providing some value, leaving the publishers with a pathetic fraction of the advertiser spend.
So essentially we've got a whole bunch of companies with no growth desperately vying for the attention of 23-year old media buyers who in turn are mostly interested in getting someone to take them clothes shopping and picking up the bill. These companies are doing it mostly by doing ever more intrusive things, since advertisers can't accept that the reason their ads don't perform is that nobody wants their stuff and keeps looking for a silver bullet.
I've come to believe that the only reasonable justification for most advertising is that it's in some sense a way for other industries to subsidize journalism. Since that's going away, I'm looking forward to the inevitable ad tech carnage ahead, and if a potential next wave actually brings higher quality advertising and better end user experiences I'll happily eat my shoes.
Reality leans the other way. What eill likely happen is that sites that used to make 100k a year from ads see their revenue drop to 70k then 50k then 30k. To stay afloat they plaster more and worse ads in order to survive.
This is exactly what happened during the first dot com crash when we went from $35 CPM banner ads to $1. Suddenly, ads were slathered on every page or websites simply disappeared. What we really need is a deal that works well for all three parties: advertisers, consumers and content providers. Google Adsense was this perfect solution for a while (until it got optimized to max profitability).
Maybe online advertising is like social networks and can only enjoy brief moments of relative balance before the cycle starts anew.
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