Marc Andreessen: Ad tech has fueled a ‘race to the bottom’

It’s often publishers that are left claiming that the influx of venture capital-backed advertising technology companies is leading to a downward spiral of low-priced, low-quality ads that make it nearly impossible to be a content publisher. Now you can count at least one top VC as also in that camp: Marc Andreessen.

Earlier today and this evening, Andreesen engaged in a lively Twitter discussion on the fate of news as a business, taking a few detours to address the ills of Web advertising. After he complained about teeth whitening ads, I posed the question to him whether advertising technology had failed publishers, seeing as the ads he complained about weren’t direct sold but placed through the Web of intermediaries that’s arisen to comprise the ad system.

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That’s fairly damning coming from the founder of Netscape and the leader of one of the top VC firms, Andreessen Horowitz. Andreessen, whose firm invests in tech platforms rather than media, had several other interesting thoughts on the state of news businesses and advertising.

The news market will expand.

 

Alas, that’s not great for many incumbents.

And scale will matter — or expertise in an area.

 

Of the eight possible ways he sees to build a business off news, ads will remain No. 1.

Publishers need more self-respect

 

The banner ad has failed publishers and the industry.

Because the ads are really terrible.

 

And irrelevant.

Subscriptions will play a role.

And so will other avenues, like events.

Quality is still a viable strategy in a world of aggregation and clickbait.

In fact, the amount of noise increases the value of the signal.

 

And that will lead to a diversity of media companies, even if they’re not enormous businesses.

Image via Shutterstock

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