I don't even believe that 25% of users actually wanted tracking. I think a lot of people just blindly tap buttons to make annoyances go away, and these guys just hit the wrong button.
Where’s the subscription management startup model?
The problem is that subscription services make billions annually on forgotten subscriptions. None of them want an easy "disable" slider next to their name in a convenient app. It also makes à la carte subing easy, where you sub for a month every few months to "catch up".
Basically, good luck getting an API with an easy unsubscribe command from any subscription based service.
Make introductory rates low and let people lock in. If they unsub and then resub they will have to do so at a higher rate.
The key word here is "programmed" - and what has been programmed can be deprogrammed. I honestly believe that we can re-rehabilitate people to no longer automatically give away their privacy for a service, and instead consciously and carefully assess the financial cost vs. utility of a service.
This could lead to both a reduction in the amount of available services (as smaller ones go out of business because people realized that it wasn't really worth it for them) and an increase in the number of services people are actually willing to pay real money for.
Also, if the subscriptions were far cheaper (say, $2/month), I think that 20 concurrent subscriptions would be acceptable to many people.
It is definitely possible to have “nice” ads, like simple text or images, with no creepy or CPU-draining elements in them. Nothing is preventing those ads from supporting free services.
Within the Google search itself, I was surprised by the number of ads that are disguised as search results. It's grown significantly. Now I have to scroll to get real results...
They also didn't used to trick unsophisticated or distracted users into clicking ads by putting them inline with search results.
Both changed, I assume, when someone was allowed to run an experiment and the projected profit trend line went from "exceptionally good" to "holy shit, it's all the money in the world". And all it took was being evil. Go figure.
Some tie this to internal fallout from the the DoubleClick acquisition, which checks out pretty well timeline-wise.
Without that promise, there’s no reason to favor advertising on these platforms over other platforms. Which, if you flip it around, means that there’s no reason that these platforms should be valued in excess of the traditional-advertising-impression-value of their MAU. (Which is, to be clear, a lot lower than the value these companies currently have!)
The GP comment said:
> Nothing is preventing those ads from supporting free services.
And my thought is, a zero-or-negative profit margin might very well be. It costs a lot to run Google/Facebook/etc. — probably a lot more than it costs to run the types of services they compete with. For the companies to not go bankrupt, their ad clicks/impressions need to be of at least as much value as their CapEx+OpEx. With adtech type ads, they certainly are at least that valuable. With only traditional type ads, would they still be?
I'm not arguing that these companies should be allowed to do this because they have some fundamental right to exist, mind you. Just pointing out that taking adtech out of the equation could "pop the bubble" drive margins negative, and just erase the whole free-ad-supported-services market entirely.
(Consider: why don't traditional-ads companies offer free web services supported by said traditional ads? Is it only because nobody cares about buying placement with them when targeted placements are available from Google/Facebook/etc.? Or is it because, even with full dealflow, it's still negative-margin?)
Precisely. Instead, there will (again) be reason to favor advertising on high quality content.
Redistribution of income away from ad platforms and content spam mills to original journalism and high-quality entertainment would be an unambiguous win for society.
(Whether this is a good or bad thing depends on your perspective.)
When paid services are normalized, it opens up a huge amount of potential for smaller players to innovate.
I despise ads, and generally approve of anything that makes ad companies sweat, but it didn't have to be that way. We are where we are because those ad companies have a sociopathically disrespectful attitude towards the people whose attention they need. With tactics like auto-playing videos, popovers, animated ads, and hideously obtrusive design, it was simply inevitable that people would try to get rid of that garbage. That approach to advertising is borne of greed and laziness, and it deserves to fail.
But there are tech blogs I read that do not adopt that approach. They have small, tasteful, non-animated ads. They don't need to violate my privacy to have a good idea of the kinds of things I'd be interested in; the fact that I'm on a tech blog means I'm more receptive to ads for tech-related tools and services. The people who run these sites have more respect for their visitors, so they choose a more respectful approach to ads.
Like I said: most companies' approach to ads is rooted in abject contempt for the people they need. If your business strategy is based on treating people badly, you have no grounds to complain when they decide not to put up with that anymore. You can either whine about how unfair it is and fail, or you can identify an approach that is appealing enough to be sustainable.
This could be a chance for that much-vaunted market-force-shaped innovation. Facebook's current strategy—whining—suggests they're still stuck in the old way of thinking: greed and laziness.
Personally, I hope things like this start to kill off the "free internet." I'd much rather pay for the things that I use.
Bonus: Maybe this will be an opportunity for content providers to reset the decline of advertising prices that has happened over the last decade. (Remember the blooming blogger scene in the 2000s, when you could still make substantial revenues? Remember the thriving online news papers? We could get back there, if advertising became less invasive and less aggressive and also more profitable for content providers, e.g., how it had been in print.)
I guess, reducing distraction and moving towards a client-based and user-controlled "ads manager" may have a decisive impact on overall blocking habits.
No matter what there would be discrepancies in the numbers (publisher says it sent 75 clicks, advertiser says it got 70) and that breeds mistrust. Participants have a reason to lie. Having multiple third party watch the whole thing helps them trust each other.
P.S.: The general idea of targeted advertising misses the concepts of state of mind and focus of interest entirely. There's a (significant) difference in delivering a message in context and out of context. (The latter may have even adversarial effects.)
Is this an argument for the open web, or is this an argument for Google being more popular than Facebook? If the former, I am with you. If the latter, the gap is not as big as you might think - 4 billion worldwide users of Google Search vs 2.85 for Facebook [1]. Slight advantage to Google, but how many US advertisers really care about international buyers? When it comes to advertising, you want people with money burning holes in their pockets. Facebook's financial results show that they plenty of access to this demographic.
> The general idea of targeted advertising misses the concepts of state of mind and focus of interest entirely. There's a (significant) difference in delivering a message in context and out of context.
You're slightly lagging with this argument. This exact reason was why Google was so dismissive of paid social back in the formative years of Facebook ("who gives a shit about what college students talk about on social networks?"). And then the oh shit moment happened in 2011. Eric Schmidt had to step down and Larry Page tied bonus payouts to the success of Google Plus. You have to give Larry some credit here - while a bit slower than Zuck, he did see the writing on the wall before the rest of the world did. If you tried advertising on both platform in 2011, Google would just crush you with their results. By 2016, Facebook was already competitive with their interest and lookalike targeting for a large group of advertisers (and even enabled Trump to win the presidency), and by 2018 the game had advanced to the new concept of "creative targeting" which is basically entirely driven by the algorithm and takes minimal targeting input from advertisers. At that point, paid social became so good that it got creepy and turned the public sentiment to negative and incentivized Apple to jump on the band wagon with iOS 14.
So I wouldn't agree with your argument that Facebook has a fundamental problem with recognizing intent. If anything, they are too good at it for their own sake.
[1] https://review42.com/resources/google-statistics-and-facts/
On a historical note, as it turned out G+ was soon scrapped and quite a loss, while we're dealing still with the fallout of Google's uniform platform strategy, which was put in place to provide for G+.
For instance, there are discontents around Nielsen (they've had scandals in India, and I infuriate people in the TV industry with the suggestion that a Nielsen home got bribed to blast MTV in an empty room) but the participants believe in Nielsen: people know probability-based sampling basically works.
This is very common on HN these days - stating something with a lot of confidence that turns out to be some self-constructed mental model that has nothing to do with reality. Then, add the obligatory "all related studies are showing it" and you have met the publishing standards.
Legally or illegally, morally or immorally, for better or worse, Facebook has created the most sophisticated ad targeting engine the world has ever seen. You want proof? Look at their financial statements. You want more proof? Look at all the companies that went public on the back of Facebook's ad targeting engine. Again, perhaps it shouldn't exist in the first place, but trust me, it works.
That said, I've never come upon a study that showed significant gains due to targeting, rather to the contrary. – So, after a decade, I'm still waiting for any proof in favor of targeting. (The suspicion must be still that targeting is rather a lazy alternative to media analysis and its perceived advantage is rather rooted in minimising efforts than in effectiveness.)
Regarding "Facebook has created the most sophisticated ad targeting engine", this is a rather biased proposition. It has enforced Facebook as a broker, made advertising cheap, while less effective, and has driven ad revenues for content providers downhill. (Google is to blame, as well.)
* Consultancies that improve marketing campaign efficacy make lots of money
* HN users are making small fractions of that money and constantly complaining about it
* Any HN user capable of picking this low hanging fruit could do this for two years and retire for life
* They are not
* Conclusion: Either there is no low hanging fruit, or the HN users observing this are making millions of dollars, or these HN users do not care for money at all and get greater utility from complaining about money.
You could also conclude from your remarks that there is a pervasive idea around ad teams that former generations (in the times of media analysis) were just delivering complete failures. However, this model had delivered for more than a century. How could this model perform with todays instruments and data?
In software, we call this "talk is cheap; show me the code", but of course here you don't need to show me the code. It's just that you're letting this golden opportunity go to waste. Up to you, I guess.
Edit: Moreover, you had to compete with the paradigm of low effort, high interchangeability and big data. (Meaning: interchangeable code, interchangeable users, interchangeable professionals, interchangeable clients, and lean know-how stack as it's "all in the data". While this adheres to criteria of optimization, it doesn't necessarily mean that it represents an optimum of effectiveness, as well.)
Those are someone else's words, not mine. I never argued that winning on Facebook is "easy" (and for the record, neither is it on Google). It's not easy, it's just doable. And for those who have the skills and resources to do it, it's massively profitable. I would even argue that if you're letting an agency run your Google or Facebook account, you're lacking the resources to do it right. What you need is top-level talent competing against your nearest competitors, and winning battles inch by inch. An agency will never give you the talent you need to go up against a company that just raised $100m and is running their performance marketing in-house (and if you don't have such a competitor, then you're either smarter than anyone else in the world, or simply not pursuing a VC-investable market).
So no, it's not easy at all. But it's doable and totally worth it.
Homeopathy peddlers make a killing, so does the agile consultants and th catholic Church, if this is proof they must both be right?
Just because someone made loads of money doesnt mean their claims are sciebtifivally valid.
> All related studies are showing that the latter isn't working anyway.
I pointed out that Facebook wouldn't be profitable if the ad platform is ineffective, and you called that argument fallacious. I am really curious to hear what's fallacious about it.
It just means that Facebook is good at selling ads, whether they are effective or not.
> It just means that Facebook is good at selling ads, whether they are effective or not.
Facebook doesn't sell ads. Marketers choose to sign up and spend money, because their jobs depend on being able to achieve ROAS targets. Contrary to popular belief, the world of marketing is very quantified and apart from experimental budgets, most of the money is spent on channels that are proven to work.
But without getting any deeper into all of this, I think I found my answer - it appears that at least a subsegment of people on HN believe that over 100BN of ad dollars (25% of overall digital ad market) is spent on Facebook in an unprofitable way, and that 5 million marketing teams get away with it, year after year. Hence, it's possible for Facebook to achieve great financial results without their ad platform being effective.
1) Nobody is saying that ads aren't profitable or that marketers are throwing money out the window because they are stupid. The discussion is about whether invasive user tracking is effective. Ads can be profitable even though user tracking is ineffective.
2) This thread also is mostly about your very weak argument. You wrote:
> Facebook has created the most sophisticated ad targeting engine the world has ever seen. You want proof? Look at their financial statements.
That's just not a good argument. Who knows, maybe Facebooks tracking really is the best thing in the world, but the fact that Facebook is raking in loads of cash on its own tells us very little about how effective their user tracking is.
You said:
> I am really curious to hear what's fallacious about it.
But apparently that was just a figure of speech, not an actual question.
1) People want the services more than they value their privacy. Maybe they'll just not use the service if they can't use it without tracking
2) That invasive tracking is required to sell ads. The media industry made billions (trillions?) of revenue from ads before tracking became a thing.
3) That platform ads are the only way to make services that are free for consumers. For example, Vimeo offers an ad free video delivery service that the content creator pays for. If Youtube was no longer free, maybe content creators would just pay for content delivery instead of having consumers indirectly pay for deliver with ads. Content creators have no issue selling ads / sponsorships without any tracking whatsoever. The result would be the same as now (content free for consumers) only that now non-targeted ads would pay for everything.
4) And finally, you are assuming that targeting via tracking actually works well enough to make it worthwhile. From what I've read, ad targeting is nowhere near as good as Facebook et al would have advertisers believe. Maybe invading your users privcy just doesn't make such a big difference in the end.
Or they'll just go outside and find better uses for their time.
Imagine that your entire business is only appealing to people if it is free.
I mean a lot of crappy 70's sitcoms would not exist if people had to buy tickets to watch. Honestly, I would not mind that world. :-)
People really like free. When it's there, it will tend to suck the air out of almost everything else. Including things that are almost-but-not-quite-free.
I think there's much more evidence to the contrary than there is for your position.
Facebook is absurdly, staggeringly profitable. Uber and WeWork by comparison are the BS business models, needing to break local laws and requiring nation-state levels of VC backing and still nowhere near profitability.
Because it is stealing - the transactions were not voluntary and informed. most users are only now catching on to what they've been robbed of.
If FB's targeting wasn't working, then nobody would have a reason to move away from paying Google and Bing to post ads on search results. FB and Google now own the online ads market, and FB got there in well under a decade.
I'm reminded of a comment from the guy that created the TV-B-Gone. He would turn off TV's in public places like self-service laundromats, etc. He said he was surprised by the general reaction of those that had just recently been transfixed by the flickering 60Hz cathode glow. Mostly they just turned away form the TV and went back to quiet thoughts or whatever.
It was like the TV could go away and people would be like, "okay".
I would definitely find it relieving if someone showed up with a TV-B-Gone and clicked it off.
20+ paid subscriptions make no sense, but checking a box with your ISP to get a 2 USD monthly credit to use on the articles you click on, could work.
Which gives them leverage. If they were better organized, they could make demands based on that leverage.
Something like Deny Tracking Allow Tracking
instead of the "Ask app not to track" I have to read the prompt a few times to make sure i pick the right one
But yeah, my preference would be just something like "Do not track".
1) It denies the app access to the IDFA identifier that is used for tracking. This is 100% reliable, apps just will not get this if you click "Ask app not to track".
2) It signals to the app that it is not to track you using any other method either. There is no technical way to enforce this, so it is up to the app developer to honour this themselves. Apple will do some checks to make sure you follow this, but there is obviously no way they can detect this reliably. All they have is the threat of kicking you out of the app store if you get caught.
https://9to5mac.com/2021/04/27/what-does-ask-app-not-to-trac...
https://www.reddit.com/r/ios/comments/ma7gwx/why_does_it_say...
Would they be willing to accept the end of Facebook to stop the tracking? No. How do we know that? Because they kept using it in the past.
This is a real phenomenon known as consent fatigue.