[derefr]

However, the reason companies looking to place ads, will choose modern-adtech-platform-X (Google, Facebook, etc.) over traditional advertising medium Y (billboards, TV, etc.) is that the former promises to be more targeted (using the ad”tech”) than the latter, such that there’s higher value-per-click or value-per-impression.

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!)

[Retric]

Many companies are prohibited from doing stuff that they would profit from. I am sure soda companies would love to be able to add heroin to their products etc. However, maximizing random companies profits isn’t societies only concern.

[derefr]

My point wasn't so much about maximizing profits; it was more that these free-service companies might not even be tenable (at least at their current scales, or anything like them) with the drastically lower profit-margins of traditional ad impressions.

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?)

[Retric]

Tracking doesn’t actually add that much to how much they can sell advertising for. As to traditional advertising companies it’s simply a question of competence, you may as well ask why they don’t sell vacuum cleaners.

[hedora]

> Without that promise, there’s no reason to favor advertising on these platforms over other platforms.

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.

[alkonaut]

Yes! So money will flow back to magazine ads, billboards, radio, tv, and other media that has seen money flow away the last decades. Because their untargeted ad model is now not much worse.

[nicoburns]

Consider how much profit a company like facebook makes. Ad value could take drop a lot and they'd still be a viable company. They's lose, but from a societal perspective I'd argue that probably a positive.