February 27th, 2018

A Better Web for Everyone

With the advancement of technology in the digital world, the internet is always changing. The tension between advertisers, users, and businesses is just another one of those changes. What we can be sure of is, when this tension resolves, the internet as we know it most likely will not be the same.

Back in June, I read the article "Building a Better Web for Everyone" written by Sridhar Ramaswamy, Senior Vice President of Ads & Commerce at Google, which examines the current state of online content creation and advertising. Mr. Ramaswamy points out the friction between users, advertisers, and content creators - users dislike disruptive ads and in response, install ad-blocker plugins on their browsers, which leads to reduced income to content creators, who in response attempt to block users running ad-blockers.

This is a tremendous problem for content creators: 11% percent of online users worldwide are using ad-blockers, and this number is growing at a 30% annual rate. Some analysts estimate that the loss in revenue for content creators may reach $35 billion by 2020.

In this context, there is a clear need to "build a better web for everyone". To address the issue, Google is introducing a new ad-blocker built into their popular Chrome browser. It may seem self-defeating for Google, which makes billions of dollars per year from online ads, to add an ad-blocker to its browser. However, if we take a look at the existing third party ad-blockers, we can see why Google's move makes sense - these ad-blockers block all ads without discrimination. In contrast, Google's ad-blocker will block some ads, but others will be displayed. Ads will have to meet the requirements of a new "Better Ads" standard in order to be displayed. If the new built-in ad-blocker is good enough in the users' eyes, it should discourage them from installing third party ad-blockers. At the end of the day, it's better to lose some advertising, than all of it.

This new "Better Ads" standard, set to be released in 2018, is being developed by the Coalition for Better Ads, a collaboration by companies like Google, Unilever, GroupM, and the Washington Post, who have a lot to lose if current ad-blocker usage continues to growth unchecked.

You may have your reservations about an advertising standard pitched by advertising companies. However, keep in mind the following - the main reason why most users install ad-blockers is that they are trying to stop ads that are particularly disrupting, obnoxious, annoying, and at times, dangerous. I think it's about time we have standards, which can filter out the most problematic ads. This standard, may not be the best, but it is a good start. And who knows, this might cause some other groups not beholden to ad revenue to come up with better standards.

According to the blog post the new ad-blocker will include a feature called "Funding Choices" that works like this: when Chrome detects the use of ad-blockers, the website owner can choose to show a message to the user inviting them to either re-enable ads on their site, or pay for a pass that removes all ads on that site.

I think this is a very good move, as it opens a new alternative that benefits both users and content creators. On the one hand users should not have the need to block all ads, and even if they choose to do so, they can still get access to content and continue to support content creators using a "pay as you go" model. On the other hand, content creators can continue to receive revenue either from ads or access fees.

The concept behind the Funding Choices system is not new. Several content creators, such as, have put up pay walls on their website or block access users that have ad-blockers. However, in general, they have not had much success with it. It will be interesting to see if the result will be different this time.

As an extra point, I'd like to also cover the third party ad-blockers themselves. What do they get out of this? At first ad-blockers were developed to satisfy a user need to block obnoxious ads, but recently it has been revealed that there is the prospect of monetizing ad-blockers by either selling advanced features to users, or having advertisers pay up to whitelist their ads. It is reported that Microsoft and Google are paying to be whitelisted, and one would think they are not happy having to pay a third party to have their ads displayed. This may be the real motive behind Google's effort to "build a better web for everyone".