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by hiou 3919 days ago
Ad blocking is interesting in that it shows what happens when something that probably should be regulated has not. And because of this the public trust has eroded and then the answer has become an arms race of ad blockers vs ads. Resulting in a downward spiral resulting in less quality content.

The world of online advertising is a fantastic way to study the possible downsides of no regulations.

3 comments

I don't think regulations are the only solution to this problem. I think content creators have been too greedy/hopeful while there is so very much competition and a _very_ low barrier to entry. They are nostalgic for the days of large newspaper advertising margins and the domination of peoples' attention by a single newspaper/magazine during a reading session that they don't understand how people use their product now.

Content creators are desperate for more revenue so they throw on another tracking pixel, another web ad placement, another sponsorship. None of this helps the fact that content on the web is a commodity and people value their time and attention span.

Large lawsuits against the ad networks for allowing malware infections and drive-by downloads would have had an effect, but unless regulation has real teeth, it's just a hindrance or a "cost of business" with no value added to the consumer.

Well, or it's a powerful illustration of a market finding a solution to a new, novel problem.

After all, what solution would the government put in place? Ban ads? Regulate their content? How would that be more optimal than allowing people in the market to find the right solutions?

The reality is, ad supported content with lots and lots and lots of content providers may simply not be tenable, due to the fragmentation in both content and ad delivery vectors.

That requires the market to find new solutions, like paywalls, micropayments, different styles of ads, mixed pay/free models, good ol' fashioned consolidation, etc.

Now, to be clear, I'm about as far from a free market dogmatist as you can get... I'm no communist, but I'm Canadian, so...

But I honestly don't believe this is a case where regulation is appropriate. Where the market is likely to settle on a highly non-optimal solution (like, say, healthcare, due to information asymmetries, or broadband, due to enormous barriers of entry, or manufacturing pollution, thanks to negative externalities), absolutely I think the government has to get involved.

But in this case, I don't see any reason for that kind of heavy-handed intervention.

I don't think that the government should be involved in regulating advertising beyond things like banning ads for jumping off of bridges and other legitimately harmful things.

Where I think regulations do make sense is for advertising by-product: the enormous treasure trove of data about users that is collected and stored who-knows-where and has who-knows-what done to it.

Is your solution to every problem that more regulation is needed?