The tech world fell in love with advertising during Web 2.0. This was probably thanks to Google, which showed that done correctly advertising can not only fund huge tech services but also create enormous amounts of wealth. Better yet, Google’s ad system was (almost) totally automated.
Needless to say, Silicon Valley has soured on this notion. What’s happened is it’s become clear that search advertising is a once-in-a-generation business model. Startups used to talk about “turning on the revenue spigot” after getting to critical mass. If only it were so easy. Search advertising is the exception in that it’s bought, not sold. Tech companies have little desire to build up huge sales forces to do the grubby work of selling ads to brands and their agencies. This is particularly true when it comes to social media, which doesn’t have a very strong intent signal like search, and mobile with its tiny form factor and low ad rates.
The disillusionment with advertising spurred top VC Fred Wilson, who has himself been quite skeptical of advertising in the past, to post a defense of ad models. It’s telling, of course, that Wilson markets it as a “defense of free” rather than use the A word.
When scale matters, when network effects matter, when your users are creating the content and the value, free is the business model of choice. And I don’t think anything has changed to make that less true today. If anything, it is more true. I understand the frustration of certain folks about the commercialization of Twitter, Facebook, Tumblr, and a host of other services. I understand the frustration over the increasing lock down of the APIs and the control these platforms are exercising on their ecosystems. I would encourage folks to compete with them to keep the web, the mobile web, and the Internet free and open. But I would not encourage those same folks to build paid services. I think their goals will be undermined by that choice.
Read Wilson’s full post at his blog, A VC.
How agencies are shaping the future of DEI beyond their own walls
Agencies are acknowledging that diversity efforts don’t stop with their companies. In addition to improving employee representation, now agency efforts in diversity, equity and inclusion are aimed at supporting clients and external partners.
Newsletter publishers say they continue to see uptick in revenue despite advertising slowdown
At a time when larger media companies are feeling the pressure of the economic downturn and advertising slowdown, newsletter businesses continue to be in a period of revenue growth.
TikTok’s CEO faces bipartisan skepticism in first Congressional hearing on security concerns
The hearing comes amid calls to remove TikTok from government devices and in some cases even ban it entirely.
SponsoredHow advertisers are leveraging omnichannel attribution and measurement to power CTV
Sponsored by MNTN Connected TV advertising has joined and expanded the larger ecosystem of campaigns that advertisers deploy. As such, omnichannel marketing strategies now encompass television and mobile devices, tablets and other screens such as out-of-home. And as customers engage across these different touchpoints, brands are seeking and moving their measurement and analytics efforts to […]
Media Briefing: What to expect at the Digiday Publishing Summit
As DPS draws nearer, top pain points for publishers are coming to light.
New app launches through Apple hoping to win with ‘zero-party data’ when others haven’t
Caden's new app lets users connect data from their Uber, Amazon, Netflix and other accounts in exchange for money. Will it take off?