If you’ve visited almost any news site lately, you’ve likely experienced first hand just how broken the online advertising industry is today. We’re talking numerous banner ads, auto-play videos, instream video ads, sponsored posts with somewhat questionable preview images, and more.
Visiting most modern news sites today is basically like stabbing yourself in the eye socket. Your web browser isn’t too happy about it, either, as it usually drives up memory usage on your computer, causing that CPU fan to speed up or even crash your browser.
[click_to_tweet tweet=”Visiting most modern news sites today is basically like stabbing yourself in the eye socket. Too many ads!” quote=”Visiting most modern news sites today is basically like stabbing yourself in the eye socket. Too many ads!”]
These sites didn’t use to be this bad. But, the truth is that they’ve become more and more desperate to drive adequate revenue in an increasingly competitive landscape. Since their entire business model is reliant on ads, the only way to increase revenue is to pack the site with more ads.
Here’s a quick shot of a random visit to CNN:
If you scroll down on CNN, a huge chunk of the bottom of every story is full of sponsored placement.
And, have you ever been to a blog and been sucker-punched with crap like this?
I mean, there’s some quality stuff that just makes your blog seem really reputable. You must be so freakin’ proud.
You’ve also got a whole swath of more independent news sites coming up. Some of them are more questionable than others, of course. 🙂 But, they find themselves in the same situation. So, they just jam-pack their sites with every ad they can find. Many of them are just embarrassing for the owners of those sites.
Not only is it not a good look, but you’re basically just assaulting your visitors.
The Ad Industry Is Broken
There’s no doubt that the online advertising industry is big. In fact, estimates are that around $160 billion will have been spent on digital advertising in 2018. We’ll see where those numbers come in, but there’s certainly a lot of money sloshing around. And publishers want their share.
There is also a LOT of fraud, though. Juniper Research estimates that about 9% of all revenue generated in online advertising is due to fraud. That’s over $19 billion annually in fraud alone. Things like click fraud are rampant.
There’s also a thousand middlemen in this space. For every ad you might see online, there is a whole patchwork of middlemen between you and the original advertiser. All these middleman need their share of the revenue, and all of them do their own tracking. Before you know it, your web browser is being sent MULTIPLE tracking cookies from companies you’ve never even heard of… all to load down a couple of banners on some blog you’re visiting. And, of course, track your activity.
And two of the biggest middlemen of them all are Google and Facebook. Estimates are that these two companies alone take about 73% of all ad dollars… and about 99% of all growth. They’re monopolizing it… and your data.
So, what’s going on is that the ad industry is growing, but it is also on a flawed course that will need to be corrected.
- There is a massive amount of fraud.
- It is being overly centralized by Google and Facebook.
- All these advertising companies and the middlemen need data. YOUR data. So, they do whatever they have to do to gather as much data about YOU as possible.
- Publishers are held hostage. If they want to increase revenue, they have to jam more ads onto their sites, accept questionable ads, and stuff more and more tracking cookies onto visitor web browsers.
The course that the industry is on isn’t really sustainable. That’s because people are punching back…
The Rise In Demand For Privacy
In the end, the consumer is always in control. And, come to find out, most people aren’t huge fans of their information being used for advertising purposes, or in having their browser smashed by ads and tracking cookies.
There’s a war on.
It is a war between this hungry industry of online advertising, and the end user who just wants to be left alone.
[click_to_tweet tweet=”There’s a war on. It is a war between the hungry industry of online advertising, and the end user who just wants to be left alone.” quote=”There’s a war on. It is a war between the hungry industry of online advertising, and the end user who just wants to be left alone.”]
One survey in 2017 showed that as much as 40% of all US users use ad blocking. Another survey showed about 31% use ad blocking. Whatever the real number is, that’s quite a lot of people who are just throwing up the hand and blocking ads.
Some news sites fight back against this. If they detect an ad blocker, they will just block you from viewing the content unless you allow the ads.
In some cases, they offer subscription options to exempt you from the ads. I don’t envy their position. I fully understand that they need to make money, but I also understand why many consumers are blocking those ads and likewise might not be willing to pay for their content.
So, there is indeed a war on. And there are 3 parties either being incentivized by their own motives:
- Advertisers and the army of middlemen are incentivized to be as interruptive as possible as well as track everything you do so as to make the ads more effective.
- Publishers are incentivized to pack their sites with more ads so as to increase revenue
- End users are incentivized to block ads in order to safeguard themselves from the increasing onslaught
This isn’t a war which is solvable without a different model. We’ll get to that.
But, there’s another issue on top of all that…
The Dangers of Centralization (And Google And Facebook Controlling Most Advertising)
Another huge problem in this industry is that Google and Facebook have become absolute behemoths in terms of gatekeepers. They take about 73% of all ad revenue. This means that publishers feel forced to play by their rules if they want to make any money.
This kind of centralization is dangerous, though.
When either Google or Facebook changes their ad rules or even makes a tweak to their algorithm, it can potentially have a very large impact on site traffic and, hence, site revenue. This leads to a lot of publishers who totally change their content strategy specifically to tailor to these networks.
One of the dangers to this is in the world of news. Since they need Facebook to survive, they have to create content that is designed to perform well on Facebook and other social networks. What gets the clicks? Sensationalism, clickbait, headlines that are designed to spark anger and emotion. And so we get “news” that isn’t really news, but is instead supposed to piss you off or get you entrenched into some emotional battle. The goal is that you’ll hit the share button and drive up their ad views.
[click_to_tweet tweet=”What gets the clicks? Sensationalism, clickbait, headlines that are designed to spark anger and emotion. Fake news is a business model.” quote=”What gets the clicks? Sensationalism, clickbait, headlines that are designed to spark anger and emotion. Fake news is a business model.”]
If you want to know why news seems more polarized, why fake news sites have become a thing, and why memes and clickbait headlines seem to be the norm… this is why. It is a business model. The truth can be boring sometimes. Controversy makes more money and “us vs them” battles motivate people like nothing else.
Content quality drops as a result… and it becomes harder and harder to find good, solid information online.
Another danger is de-platforming. There have been many sites out there that Google and/or Facebook just deemed inappropriate and they just get banned. Unfortunately, this seems to be more common in sites that lean politically conservative. It has also happened to some sites that discuss health topics.
When the major gatekeepers of traffic these days just collectively BAN you from their networks due to your content, that is called de-platforming. Sure, your site still exists, but it is much harder for anybody to find you. And you can’t make money with ads and, for many publishers that would be a death knell.
It is a very dangerous situation. It would be easy to turn a blind eye to it… or just to accept the patent excuse that such sites were engaging in “fake news” or “hate speech”. But, in many cases, they were doing no such thing.
So, do we have freedom of speech online or do we not?
[click_to_tweet tweet=”The centralization of the internet around a handful of companies is very dangerous to the future of the internet.” quote=”The centralization of the internet around a handful of companies is very dangerous to the future of the internet.”]
Truthfully, no. The centralization of the internet around a handful of companies is very dangerous to the future of the internet. And these companies are basically black boxes as we don’t really know why they make some of the moves they do.
We need a better way.
Decentralizing the Internet. And An Intriguing Solution…
One thing is for sure…
The internet will be undergoing a transformation. While the trend has been toward more and more centralization and more middlemen, there are huge waves happening that I believe will radically transform and decentralize the internet.
The technology that will spur these very large changes is known as blockchain.
If “blockchain” isn’t a term you’ve heard, then you’ve probably heard of Bitcoin. Blockchain is the technology behind Bitcoin, however the applications of blockchain go way beyond a cryptocurrency like Bitcoin.
It is basically a distributed database that is immune to being hacked because it is distributed everywhere. Remember the scene in the movie “V for Vendetta” where all those people were wearing the same mask so they couldn’t get the person? It’s like that. It’s everywhere, so it can’t be taken down. It’d be like a game of whack-a-mole.
That’s blockchain, in an uber-simple version. Plus, it takes care of the issue of trust. It is verifiable trust without a third party.
Blockchain isn’t just about currency like Bitcoin. It is also about applications. Ethereum is all about decentralized apps. You’ve got apps like Storj, which is distributed storage that could rival Amazon S3 (while not being controlled by a middleman like Amazon).
On top of all this, you’ve got the currencies and token that are part of the whole crypto-scene. What it does is puts INCENTIVE into the system. It was (and still is) that the Facebooks, Googles and Amazons could out-incentive the smaller companies. This is what led to things becoming so centralized to begin with.
But, the tokens in these various blockchain-powered systems provide economic incentive to DECENTRALIZE. In many of these systems, the tokens are required to use the system. So, to power an app on the Ethereum network, you need some ETH (the token of the network).
Now, add to all this the exchangeability of these tokens. Where you can move one token into another, via a decentralized exchange. It all becomes economically viable. The incentive to decentralize outweighs the value that the big juggernauts like Google can provide. It is a new internet of value, with trust built-in.
If you’ve ever used BitTorrent, what I’m talking about is kinda like that. It is distributed, so it can’t be shut down.
But, in the case of these various blockchains, there will be a built-in incentive. And human nature is to use that which provides the greatest award.
You’re also going to see technologies come in which allow these various blockchains to communicate to one another easily. Sort of like how TCP/IP protocol enabled the internet to blossom. The “internet” was a bunch of separated bulletin boards before the TCP/IP protocol came around and gave everything a common “language”. The internet, as we know it today, began with that. It will happen in the world of blockchain, too.
It will dethrone Google and Facebook and those big corporations currently in control. Not out of any force… but just simple economic incentive.
I don’t know what the whole thing will look like. But, I think the writing is on the wall.
I think, eventually, we’ll be selling our stuff online for cryptocurrency much more commonly.
I think the current domain-name system which is controlled by ICANN is going to be replaced with a de-centralized system.
I think the current model of centralized hosting resources is going to be replaced by one, distributed cloud. Perhaps powered by an internet of things, decentralized storage, and decentralized computing power. The days of denial of service attacks will be over because it’d be a useless game of whack-a-mole. No point to attack.
Issues of censorship become a moot point because no single company controls the pipeline.
But, what does any of this have to do with privacy and online advertising?
A Blockchain Solution To Privacy And Ad Overload
It is called Brave.
On the surface, Brave is a web browser. One that respects your privacy and puts you in control of the tracking that websites are able to do on you. The browser is also quite fast and it is a real pleasure to use.
It is insanely effective at blocking the crap, too. Since I used CNN as an example above, look at what happens when I pull up CNN inside of Brave:
30 damn ads and trackers being blocked just from visiting the CNN homepage. Amazing!
But, what does Brave have to do with banner ads? Well, Brave is about much more than merely a web browser. It is about an entirely different structure to the internet advertising economy. It removes the middleman between the end user and the publisher.
At the core is a cryptocurrency known as Basic Attention Token (BAT).
As an end user, you would have BAT in your wallet. Then, you have the option to reward those publishers who you want to support and who you pay attention to. Soon, you will also earn BAT by viewing ads.
Essentially, this is a network designed around ATTENTION. One that rewards publishers who do a good job because you are paying attention to them. One that rewards users for viewing advertising. But, all of it is in YOUR control. If you don’t want to look at ads or pay any publishers, that’s your call. And nowhere in the transaction is your personal data exposed.
Basic Attention Token is a way out. It removes the middlemen and puts YOU in control of your own “attention dollars”.
In many ways, it is similar to the U.S. Healthcare market. Our costs here are utterly ridiculous because of a thousand middlemen between us and medical providers. And on top of that, you have law coming in and enforcing this screwed-up system under the threat of penalty. Talk about removing all choice! If we could de-centralize the whole healthcare model and re-connect providers with consumers, costs would drop substantially.
This is what BAT – and the Brave browser – is attempting to do to online advertising.
How To (Potentially) Make Money With Brave And BAT?
Now, I want to be clear…
We’re still quite early in the lifecycle of Brave and the Basic Attention Token. So, I wouldn’t expect this to make you a millionaire right now. 🙂 However, I think it is a good idea to get started with this early as I do think there’s a lot of growth ahead for BAT.
To get started, you need to register as a publisher on Brave Payments network. This will allow you to accept funds into your own wallet which is tied to your site’s domain. You will need to enter your email address.
Once you’re in, you’ll want to “Add Channel” so that you can add your blog.
You can add a website, a Youtube channel, and a Twitch channel. This means that not only can you potentially earn BAT from your blog, but you can also earn BAT with your Youtube account or Twitch.
Choose “Website” then enter the domain of your blog. Next, you’ll need to verify that you’re the owner of the site.
For most, the “trusted file” option is probably going to be easiest. It is kind of an odd process, but easy to pull off. Hit the button there to download a file called “brave-payments-verification.text” to your computer.
Then, using an FTP program of your choice, create a folder in the top-level directory of your website called “.well-known”. If you don’t want to use FTP, you could use the File Manager of your web host (such as cPanel).
Upload that TXT file into the “.well-known” folder.
Then, hit the “Verify” button on the Brave website. It will look in that folder on your site for the file. If it sees it, you’ll be verified. You can see here that I’ve verified both this website as well as my Youtube account:
The last thing you need to do is create a wallet on Uphold. This wallet will be so that you can actually accept payments from other Brave users. Here’s what your Uphold dashboard will look like:
Uphold is basically a big currency exchange. You can take in money in one currency and transform it to another currency. This includes various cryptocurrencies as well as government currencies.
Once you have enrolled in Uphold and verified your account, you can hook it up to your Brave Payments account. You will also be able to choose which currency you want to be paid in.
So, basically, if you end up getting paid in BAT, you can take the money in via Bitcoin or even US dollars. It isn’t as if you’re stuck with BAT tokens.
These BAT tokens will be exchangeable for other currencies at whatever the going market rate is. As of this particular writing, a BAT token is worth $0.13. Like any other marketplace, the BAT token goes up and down. During the height of the most recent cryptocurrency bubble in late 2017, the BAT token climbed to as high as $0.88.
One may wonder if the BAT token will again climb in value… possibly even surpassing the market high of 88 cents. Personally, I think it will. But, like any cryptocurrency, there will be ebbs and flows and they can be rather drastic.
How To Earn BAT
As a publisher on the Brave network, you have 2 ways to earn BAT:
- Create awesome content that people pay attention to.
- Refer more people to Brave using referral links.
The referral marketing just helps expand the network, of course. But, outside of that, you just do what it is bloggers and content creators do. You create awesome stuff that draws people in and makes them want to be a regular reader.
When people visit your site using the Brave browser, you go into the rotation in terms of BAT payments. The browser will automatically propose a monthly distribution of BAT tokens to the sites they pay most attention to. The end user can take control, too, and decide exactly who gets paid and who doesn’t. If you are providing value and they dig what you’re doing, they will reward you with BAT. Users can also tip publishers anytime they want by sending them BAT tokens.
As an end user of Brave, you will also have the opportunity to earn BAT.
When you first install Brave, they currently have a program where you are basically given 30 BAT as a way to get started. The purpose is to pay publishers and see how it is distributed and how you can control it. Your wallet for this BAT is held right inside your browser.
As an end user, soon you will be able to earn BAT by viewing and interacting with ads from the Brave network. As of this writing, this is still in the testing phase. The way it will work is that the browser itself will control what ads you see so that you remain in full control. Neither publishers or advertisers will get your information nor will there be a ton of tracking cookies involved. As you interact/view these ads, you will get paid BAT. In turn, you can then reward publishers based on who you want to support or who you pay attention to.
Right now, the BAT wallet within the Brave browser is uni-directional. This means that you can transfer funds into the wallet, but not back out again. For instance, if you purchased BAT on the open market in any exchange, you could transfer some of them to your Brave wallet so as to participate in the network. The whole purpose of this is to jump start this network so that it reaches some critical mass.
In the future, they will remove the uni-directional nature of the Brave wallet and you will be able to earn funds on the network as well as transfer them back out again. They will implement a “Know Your Customer” (KYC) process (necessary for legal reasons) then you will be able to have full control over the wallet.
So, here’s an overview of how BATs operate in this economic scenario based around attention.
Now, if you compare this to the 3 parties I mentioned above in the current wars, you can see how it re-defined everything.
Instead of having these 3 parties incentivized by things which are inherently in conflict, you have a new structure where all 3 parties are getting something they want and the BAT token is the medium of exchange.
This is an arrangement that has the potential to change the way monetization based on ads works.
The Future Of Ad Revenue Online?
If all goes well, Brave and the Basic Attention Token represents an entirely new infrastructure to the economics of attention online.
It removes the natural war between end users and advertisers and it puts the end user fully in control of the transaction. It will also be good for publishers because no longer will there be a need to satisfy monopolistic middlemen, risk being de-platformed, or feeling the pressure to pack your site with embarrassing and overbearing ads.
It isn’t as if BAT and Brave, alone, solves the problem. It will be in conjunction with other de-centralization efforts going on, from de-centralized social networks, de-centralized video content sites and more.
We’re still in the very early days. I think Brave has a lot of growth ahead for it. I also think that you’re likely to see competitors. The beauty of it, however, is that all these various tokens will be exchangeable with each other on the open market. So, I say bring on the competition. 🙂
An internet which isn’t controlled by big middlemen like Google and Facebook?
The end user in control of what companies can track and what ads they see?
But, all of it incentivized by real economics?
A world of potential currency competition and an internet of VALUE, not just information.
It’s a world pretty different from what we’re used to now. But, I think it is coming. I don’t think blockchain is a technology genie you can bottle back up again. And being that it is backed by real incentive, I think the growth of all this will happen much faster than you might think.
And if all goes well with a decentralized attention-based economy, it could be a very interesting – and profitable – new way to monetize your website.
To download the Brave Browser, click here.Yes, that is a Brave referral link. But, it costs you nothing (since it is free, anyway). And I’ll earn $5 in BAT tokens for each referral so I can go around and reward good publishers using the Brave browser.