Killing the Ad-Based Web

Its time has passed.

Internet advertising
via Kaspersky Daily

FT (“Newspaper groups warn Apple over ad-blocking plans“):

British newspaper groups have warned Apple that any move to impose a so-called “web eraser” tool to block advertisements would put the financial sustainability of journalism at risk.

Apple is preparing to include an AI-based privacy feature in the Safari browser in the next iOS 18 software update that will remove ads or other unwanted website content, according to reports.

[…]

The letter, seen by the Financial Times, said professional journalism required funding “and advertising is a key revenue stream for many publishers”. Members of the NMA include The Times, The Guardian and The Daily Telegraph.

Online platforms such as web browsers and social networks are important routes for the public to access journalism, the NMA argues, but also for publishers to “monetise their content in the digital marketplace”. 

The prospect of an automatic block on online ads has caused considerable alarm among publishers, which are already facing a squeeze on revenues given separate moves by tech groups that have throttled news traffic and a broader slowdown in spending in many parts of the market. Apple declined to comment.

[…]

Apple’s attempts to position itself as a guardian of its customers’ privacy in recent years have come at a cost to a broad range of businesses that rely on data to target ads, from Meta to local newspapers. 

A 2021 software update introduced an Apple feature called App Tracking Transparency, which banned apps and advertisers from collecting data about iPhone users without their explicit consent. 

Most users declined to grant permission and Apple has tightened its privacy protections in subsequent iOS updates, including further restrictions on device fingerprinting and email tracking.

Google had threatened to follow Apple in blocking third-party cookies used by advertisers to target audiences — a move that has since been delayed in the face of regulatory concerns.

As someone who has relied heavily on web-based advertising for years, I’m quite sympathetic to the publishers here. Advertising revenue has been the lifeblood of print, broadcast, and online media companies since time immemorial. As someone who is extremely online, though, I laud Apple’s move here and hope regulators allow Google and others to follow suit.

OTB and its now-defunct sister sites, particularly Gone Hollywood, did quite well in the heyday of the Internet boom. Advertisers were eager to send website publishers money for premium space on our sites, hoping to peddle their wares to our niche audiences. It took them longer than it should have to discover that readers quickly learned to ignore the banners atop the site, a phenomenon known as “ad blindness.”

Eventually, they caught on, creating an arms race that was good for no one. They made the ads increasingly intrusive in an attempt to force site visitors to pay attention. They flashed. They played videos. They started appearing in unexpected places among the content. Eventually, they even started hijacking the sites themselves, taking readers who inadvertently clicked on an ad to another page with no easy way back to whence they came.

Naturally, readers didn’t like this and started employing various ad-blocking software to read their favorite sites in peace. Because this was taking away their revenues, site owners employed increasingly aggressive tools to counter that practice, including blocking visitors who had detectable ad-blockers running.

Somewhere along the way, people started consuming their web content primarily on mobile devices rather than desktop and notebook computers. Because mobile phone software, particularly Apple’s iOS and iPadOS, is more locked down than standard browsers, ad-blocking tools are either much harder to deploy or nonexistent. Even as a savvier-than-average user, I find myself inadvertently being hijacked multiple times a week on my iPhone, taken to a page I didn’t want to visit with the back “button” disabled.

It’s long past time for the madness to stop. Internet advertising is incredibly inefficient for advertisers and beyond frustrating for site readers.

The obvious question is, If not advertising, then what? How can media companies make a living? And there’s no easy answer to that.

The most obvious solution is to sell subscriptions. But few companies, indeed, have been able to sustain that model. That’s particularly true in the political commentary space, which has always relied on some combination of subscriptions, advertising, and angel investors willing to lose lots of money.

As I’ve recounted here of late, OTB has been a money-losing enterprise since the bottom fell out of the ad boom. And we’re a pretty lean organization, just needing server space and the like. None of the front-pagers is making their living from writing here. We don’t have to pay an army of reporters, editors, photographers, and support personnel.

I pay to subscribe to multiple news, politics, and sports websites. I can justify that mostly because I rely on their content to run this site. But even I routinely cancel subscriptions once the initial teaser rate expires and don’t renew unless and until I can get a huge discount. And most people are far less motivated than me.

I’ve long argued that we need something like Spotify or the old cable bundle for the Internet. There has to be a way to create some sort of tiered system that allows consumers access to every news, sports, tech, and other niche website out there at a rate that’s affordable and yet allows content providers to make a living.

One can envision multiple models for that. It could essentially be a micropayment system where readers are charged and site owners receive a tiny amount for each site visit. Or something like a mobile phone plan, where customers decide up front how many visits they want to pay for each month. Or something like the old cable TV model with basic and premium tiers.

FILED UNDER: Economics and Business, Science & Technology, , , , , , , , , , ,
James Joyner
About James Joyner
James Joyner is Professor and Department Head of Security Studies at Marine Corps University's Command and Staff College. He's a former Army officer and Desert Storm veteran. Views expressed here are his own. Follow James on Twitter @DrJJoyner.

Comments

  1. Sleeping Dog says:

    Try DuckDuckGo’s IOS browser for your phone.

    Between the ads, lousy page design and slow loading, many websites are simply unviewable. If the content is really something I want on one of those sites, I either, turnoff javascript (Chrome and FireFox have applets that allow you to toggle javascript on or off) or use Reader View, which only presents the text and limited photos.

    Ad Blindness has afflicted me long before the internet.

    Second your thought on a Spotify type subscription service.

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  2. charontwo says:

    I can see where this is a problem for people who access the net on mobile devices because of the limited screen space.

    I don’t use an ad blocker because I only view the web on a desktop with a really big monitor – I even occasionally see something advertised that interests me.

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  3. DrDaveT says:

    My cable service comes with a DVR feature, in addition to on-demand viewing. In on-demand, when I watch what I want when I want, I have to put up with ads. In DVR, when I record something and watch it later, there’s a smart fast-forward that will zip through the ads and automatically resume play when the content comes back. It’s not as convenient as no ads at all, but it’s a lot better than having to sit through the same ads over and over.

    I wonder what the equivalent for websites would be. You can view a page ad-free if you wait at least N minutes between clicking and viewing? The existence of this feature is apparently not an existential threat to cable content providers.

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  4. Not the IT Dept. says:

    “They made the ads increasingly intrusive in an attempt to force site visitors to pay attention. They flashed. They played videos. They started appearing in unexpected places among the content. Eventually, they even started hijacking the sites themselves, taking readers who inadvertently clicked on an ad to another page with no easy way back to whence they came.”

    In other words, they annoyed the crap out of visitors and then wondered why people still weren’t buying. They’ll never figure it out.

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  5. MarkedMan says:

    Advertisers were eager to send website publishers money for premium space on our sites, hoping to peddle their wares to our niche audiences.

    And here is the biggest change, right there. The big ad services know who you are and what site you are visiting and can find you anywhere and direct an ad anywhere you show up. They know that people that visit this site are politically active, making us niche, but they don’t have to advertise to us only when we are on this site. They will know when we visit another site that allows advertising and catch us there.

    Almost without exception, sites don’t sell ads directly but let the big ad services use their space. But this means they can’t get premium prices for the ads no matter how niche they are.

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  6. Neil Hudelson says:

    I like the Brave browser model that shuttles your monetization into an account you can access. You can chose the sites you frequent often to get a larger portion of your ad account (I chose OTB and TPM), some gets automatically distributed to sites you frequent but which you didn’t choose, and the rest goes into a crypto account which you could convert to dollars. (Or, rather, convert to another crypto and then convert to dollars).

    I currently have $10.92 (or its equivalent) waiting for me, and it only took about 5 years of using the browser. Payday, baby! If I ever get around to it, which I won’t.

    Clearly there are some problems with this model, the big one being the crypto basis. I assume that’s also the form of the payment the sites get, though I’m also assuming the universe of Brave browser users who also visit OTB regularly is so small that we might not have even reached a threshold to disburse crypto funds, should you want them. So I guess the second big problem with this model is adoption. A third issue is what happens to sites which aren’t chosen by the user or by frequency of use? I imagine there could be a back end access fee, a percent of a penny per visit, that comes out of one’s account.

    The pros: the ads are unobtrusive while being noticeable. The pop-up does draw my attention, but unlike the pop-ups you are probably imagining, its just s small beige box with text that covers part of the address bar and bookmarks bar, not the browser window. One gets extra tokens if one clicks on the ad, which is also much better for the advertisers.

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  7. inhumans99 says:

    As someone who has had to be careful to not buy too many of those .99 cent in-game purchases for mobile games because the dollars add up fast, I still want to go forward and say that the time is long past overdue for micro transactions to overtake advertising dollars as a money maker for many companies in the web.

    For example, instead of a subscription service model for the Wall Street Journal I bet I would purchase something like 5 article clicks for .99 cents a few times a month, better than 0 dollars from me, and I would avoid the hassle of cancelling a subscription.

    Advertisers need to pivot to being a link you can click on that anyone would see who has not bothered with an ad free micro transaction purchase is going to see on the webpage but enough with videos that auto play with sound on that you cannot easily close.

    Even news and pop culture sites need to stop with auto playing their own video content as it burns someone out from wanting to constantly consume content on certain sites

    I want to avoid paying for more not easy to cancel subscriptions to consume online content.

    I am aware that micro payments is not the ultimate solution for ad free content consumption, because if I had to spend as little as .99 cents a day for OTB content that would not work, ending the month with $30 in micro charges would not be financially sound for me and many others, but there has to be a better solution than dealing with certain sites (OTB is not one of these sites) that runs slower than molasses due to to all the forced ad consumption thrust on the end user.

    For journalism sites I can see micro payments as an actual possible solution, but for sites like OTB it feels like asking for donations or folks to become patreons is still the way to go.

    So easy to complain about ads on the web but oh so difficult to come up with a solution that would work for most everyone on the web, lol

    Happy Monday everyone.

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  8. Michael Reynolds says:

    Or something like the old cable TV model with basic and premium tiers.

    Hollywood is doing exactly this, re-bundling and breaking out ad-tiers. The ad sales don’t seem to be going very well. But soon we’ll have a $29.99 service that’ll give you Disney+, Hulu, HBO and Discovery channel crap. A lot of people think Paramount+ and Peacock will have to merge to survive, maybe becoming nothing more than tiles on the Disney site.

    The 900 pound gorillas are Amazon and Apple, either of which could buy every single studio, every single streamer, every single content-producer aside from Google’s YouTube. Disney, Netflix, HBO, Peacock and Paramount all together are worth maybe 600 billion. Amazon is worth close to two trillion. Apple is closer to three trillion.

    Media may look like publishing soon, where we have basically five publishers (for now.) Within 5 years I expect we’ll be down to Netflix, Disney and Amazon.

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  9. Bill Jempty says:

    @Michael Reynolds:

    Within 5 years I expect we’ll be down to Netflix, Disney and Amazon.

    Like what flying has become. Goodbye Northwest, TWA, Continental, USAir. All major airlines when I was a Platinum FF.

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  10. Gustopher says:

    I’ve long argued that we need something like Spotify or the old cable bundle for the Internet.

    Spotify pays artists terribly.

    Apple tried to create this with their Apple News, but were unable to get any of the big newspapers to play along, likely because they also pay terribly. (They do integrate my WaPo subscription into the free tier, but the paid tier adds nothing I’m willing to pay for without getting bundled with a few big papers)

    ETA: Spotify does pay Joe Rogan very well. So they aren’t just about paying musicians poorly.

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  11. MarkedMan says:

    @inhumans99:

    the time is long past overdue for micro transactions

    Couldn’t agree more. You can either be a subscriber at $X/month, or buy individual articles. Someone links to the Poughkeepsie Times Herald because of an incident that happened there? I click though and am greeted by a request for 50 cents or a dollar to read and I make my choice accordingly.

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  12. Kathy says:

    @inhumans99:

    Happy Monday everyone.

    At first glance, it looks like the kind of old-fashioned contradictory statement that would drive an AI to self-destruct. If it were not equipped with paradox absorbing crumple zones

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  13. Gustopher says:

    @MarkedMan: Anyone who supports microtransactions should take some time to get to know how microtransactions have affected video games — once the infrastructure is there, it will be used incessantly to extract as much money as possible for even the most mundane tasks. Poor incentive structures lead to a poor experience in the end.

    And once the infrastructure exists, how long before it gets deployed everywhere, not just newspapers? Credit card fees make the minimum transaction somewhere between $0.50 to a buck, which prevents the proliferation of micro-paywalls that micro-transactions would allow and even encourage*. (Video games will often batch up transactions and charge them as one to cut the fees)

    Also, do we really want to encourage the Poughkeepsie Times Herald to monetize specific sensational news stories? I’m not saying that they will be killing people just to report “serial killer claims 12th victim!”, but it would affect the style of reporting.

    Now, I would support a news tax/surcharge on ISPs, which is then divided based on visits to sites and disbursed. It requires the ISPs to record where you go, but they are already doing that. (And, since you pay that tax/surcharge anyway, it doesn’t incentivize using a VPN to avoid it)

    ——
    *: I genuinely feel dirty having come up with a good thing about credit card transactions being so high.

    ——
    ETA: And someone would need to think about how micro-transactions (and their record) would be used by men abusing their wives/girlfriends, as well as stalkers. Because any public facing technology change needs to take that into account.

    ETA2: yes, women can stalk and abuse too, but it’s like women’s rugby — the men are at an entirely different level. (I know nothing about women’s rugby, or men’s rugby. I just figured anyone who wants to make the argument about women also being abusive would like their egos soothed on sports. Maybe women’s rugby is especially vicious)

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  14. Just nutha ignint cracker says:

    old cable bundle… microtransactions

    Is it too ironic for me to mention that the way we got to the streaming system we have was because we were complaining about how expensive our cable bundle was but that there was no savings to be found in purchasing the individual channels that we wanted? But yeah, I know. “This is completely different.”

    Just like Iraq and Afghanistan were totally different from Vietnam. Totally. I get that.

    ETA: While I’m here, I’ll note that at 99 cents a link, buying one every day would would cost more than the annual subscriptions to several newspapers or newsmagazines. And who’s only going to buy one? Might as well try to eat only one potato chip or cookie. Or smoke one cigarette.

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  15. inhumans99 says:

    @Just nutha ignint cracker:

    I am very self aware that I am advocating for a payment system that caused me to spend way too much money on mobile games. You could say that in game purchases are one of, if not the worst thing to happen to games over the past 30+ years.

    The odd thing is that I still feel that some combo of allowing for a micro payment option and/or modest subscription fee is what can help keep journalism afloat without having to bow down at the alter of the advertising gods.

    I have a high tolerance for ads but I agree that many sites are a genuine chore to engage with due to auto playing flash ads and stuff that makes you almost want to throw your laptop/tablet/phone across the room.

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  16. MarkedMan says:

    @Gustopher:

    Also, do we really want to encourage the Poughkeepsie Times Herald to monetize specific sensational news stories?

    I picked this specific fictional paper because it already has a paywall, but one limited to full blown subscribers. See also The Econmist, the various city business journals, etc

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  17. Just nutha ignint cracker says:

    @MarkedMan: How does a fictional paper create a paywall or have full-blown subscribers?

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  18. MarkedMan says:

    @Just nutha ignint cracker: Amazingly, the paywall is also fictional s are the subscribers. See? It all balances perfectly in the end

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