An Ad-blocker, a Vendetta, and the future of Online Media
content creators on the internet will never be the same again. Many will be destroyed.
The ones who survive will be forever transformed.And that might not be a bad thing.
—Brian Alvey
Once the excitement over the announcement of the iPhone 6s and its ‘3D touch’ feature quieted down, discussion quickly turned to the ad-blocking capabilities quietly tucked inside Apple’s new mobile operating system. Many are aware that ad-blocking has been available for years on other desktop browsers, but many others are convinced that ad-blocking undermines the key engine of a majority of online businesses and that its uptick will cause massive upheaval in the online media world.
And its true: entertainment, news, and information organizations hastily adopted ad-based business models as a matter of survival (see Newspaper Death Watch). But because users do not think of the implicit transaction, “in exchange for this content, I give you access to my eyeballs, and I guess my personal data as well”, users now want the content for free, and Apple played the white knight by helping them get it. Far from either creating a pristine browsing experience or marking the death of online media, this instead represents a natural evolution in its delivery methods. And as serial entrepreneur Brian Alvey suggests, this might not be a bad thing.
Ad-based business models create a problem for content providers when the interests of its users conflict with those of its actual customers, advertisers (hence the emergence of ‘clickbait’). If users prevent companies from selling personal information and ad-space and are faced with the decision to pay for it or be denied access, content providers will be forced to be more responsive to their interests. We see this leading to a consolidation in media resulting in more reliable information and higher quality content.
A straightforward comparison is that of two leading online streaming sites: Netflix and Hulu. Netflix derives revenue from users, who pay a subscription fee for unlimited access. They are leading the way in adapting to the tastes of its users, bringing high quality documentaries and tv series raising the bar in terms of diversity in television. Hulu on the other hand, is essentially an extension of cable networks on the web, and though they are now offering an ad-free premium service, a majority of its revenue is from advertising. Accordingly, it developed innovations such as in-stream purchases and engagement through ad-selection, given who their keeper is.
Another comparison is that of the two tech giants at the center of this debate: Apple and Google. Apple is traditionally a hardware company whereas Google is a services company powered by ad-revenue. Following Steve Jobs’ publicized vendetta against Google, this move can be viewed as Apple chipping away at Google’s base by blocking ads and making slow progression towards a search engine of its own. And of course, a shift from ad-based models to subscription-models would likely feed into sales on Apple’s App Store, which Apple would take a cut from.
Beyond aligning a company with the interests of its users, ad-blocking has clear benefits by protecting privacy, reducing data use, and improving speed. Silicon Valley figure Jason Calacanis compares blocking ads on a mobile phone to “moving from from a crowded apartment complex in a polluted, violent city to a peaceful lake house.” Attitudes towards privacy are both cultural and multi-faceted, concerning the collection and treatment of personal data, the use of this personal data by corporations vs. by government agencies, and the appropriate level of transparency of both the corporations and government agencies.
Many accept that the collection of personal information allows companies to provide them with an improved customer experience as well as services and content either free or highly subsidized. Others believe that while corporations should be blocked from collecting and bartering personal data, government agencies should have full access in the name of national security, supporting government-mandated loopholes to encryption technologies. Others believe that the government should fully support encryption and set a high standard of privacy protection as a human right. Just like any question of individual rights, it boils down to a question of balancing an individual’s freedom and those of other individuals. One individual’s right to private browsing may not outweigh others’ right for the state to monitor browsing that may prevent terrorist or criminal threats.
Scientist and tech-futurist David Brin takes a third path and notes that the problem is not the collection of personal data, but the manner in which data brokers and government agencies operate in darkness, preventing people from monitoring their behavior and responding to improper or abusive use. He supports a future with so-called ‘reciprocal accountability’ based on the power of reputation and informal social pressure: “It’s not that we will lose privacy. Its that we’ll lose the illusion of privacy and gain real privacy because we’ll catch the peeping Toms and the voyeurs.” He believes the greater risk is preserving the darkness in which bad actors flourish.
While these changes will reveal themselves over time, the impact of ad-blockers will likely be felt in the nearer future, as long as they overcome the potential barriers to adoption such as hassle, apathy, and even capitalistic ‘fairness’. Take for instance developer Marco Arment who decided to remove his top-ranking ad-blocker after 36 hours given its inability to offer a more complex solution to a complex problem. While users have the right to avoid or boycott sites that sell advertising to pay for its content, users don’t have a fundamental right to content if they use ad-blocking software to prevent the providers’ method of bringing it to them. Many believe this is why there would potentially be legal action against Apple and the developers of ad-blocking apps for interference into a company’s ability to do commerce, if ad-blocking software reaches more scale.
All these issues aside, you can never fight the tide. If people want an ad-free experience, media companies have to find a way to give it to them on their own terms. A core marketing concept is that consumers are ether time-constrained or money-constrained. The direction forward is to capture both through diversified delivery methods. Giving users a choice between paying for content or receiving it free, supported by advertising, or new forms such as sponsored content, native advertising and ‘recurring crowdfunding’ (aka the ‘public radio model’), will be next evolution in online content.