The Facebook Fallacy
technologyreview.com
The Facebook Fallacy
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Re: The Facebook Fallacy
#2Good of you to submit this with the canonical URL. All four of the previous submissions (none with any comments, per HN Search) were of noncanonical URLs with appended referrer strings or format-preference strings.
After edit: So the article's essential claim, which I guess we haven't discussed here on HN before (unless I missed a link) in relation to this exact article is that the Web is a fundamentally unfavorable environment, long-term, for advertising-supported sites. That's an interesting idea. I usually run ad-blocking software, so maybe I believe this already. I've never tried to monetize my personal website with advertisements--they just seem too schlocky.
Re: The Facebook Fallacy
#3I don't like ads (typically). But as ads get more and more targeted (ie., when i haven't gone to the dentist in 2 years and the ad says, "great dentist with promo offer just 2 miles from you", that's kind of enticing). I think it will migrate to where ads need to be helpful (ie., google ads). Search was easier because Google could target on the search term. But it's harder when the user isn't proactively searching for something.
But I think it can be done. The ads just need to be super-targetted and helpful.
Re: The Facebook Fallacy
#4I don't like ads (typically). But as ads get more and more targeted (ie., when i haven't gone to the dentist in 2 years and the ad says, "great dentist with promo offer just 2 miles from you", that's kind of enticing). I think it will migrate to where ads need to be helpful (ie., google ads). Search was easier because Google could target on the search term. But it's harder when the user isn't proactively searching fo…
ad networks targeting you with details about your health is not helpful, it's creepy and invading a very private aspect of life.
btw it's already done http://www.forbes.com/sites/kashmirhill/2012/02/16/how-targe...
Re: The Facebook Fallacy
#5I don't like ads (typically). But as ads get more and more targeted (ie., when i haven't gone to the dentist in 2 years and the ad says, "great dentist with promo offer just 2 miles from you", that's kind of enticing). I think it will migrate to where ads need to be helpful (ie., google ads). Search was easier because Google could target on the search term. But it's harder when the user isn't proactively searching fo…
ad networks targeting you with details about your health is not helpful, it's creepy and invading a very private aspect of life. btw it's already done http://www.forbes.com/sites/kashmirhill/2012/02/16/how-targe...
it's not just health. look at Google Now on android 4.1. they're going to know everywhere you went and a lot more info. sooner or later, this will likely lead to targeted ads if they can deliver high-value ads the user actually wants. ie., [you're driving past your favorite pizza shop] Pizza Boy is offering $5 off today your normal order. Should i place the order for you?" the reason most everyone will opt in is because of the high value-add it provides. my wife quickly opted in to Google Now on her android phone cause she wants the extra features.
Re: The Facebook Fallacy
#6This is nonsense. It has no place on HN.
First of all, cheap ads are not a bad thing. Cheap ads are like cheap oil: sure, it may put some oil companies out of business who can't deliver product efficiently, but this has no impact on the rest of the economy.
Second (I can't believe I'm actually defending FB) a lot of people go to the site. If FB can maintain control of the social internet and, frankly, suck less, they will own a massive channel. Part of the trick is controlling a bunch of social networks. This would would allow FB to set ad prices on all networks like a cartel.
Third, if you see a price war between Google and FB, then everyone who wants to advertise on the web wins. Yes, start-ups that hope to capitalize on ad-supported services suffer, but the rest of the web, not to mention the economy, pays no attention.
Re: The Facebook Fallacy
#7Earlier quoted context omitted.
ad networks targeting you with details about your health is not helpful, it's creepy and invading a very private aspect of life. btw it's already done http://www.forbes.com/sites/kashmirhill/2012/02/16/how-targe...
it's not just health. look at Google Now on android 4.1. they're going to know everywhere you went and a lot more info. sooner or later, this will likely lead to targeted ads if they can deliver high-value ads the user actually wants. ie., [you're driving past your favorite pizza shop] Pizza Boy is offering $5 off today your normal order. Should i place the order for you?" the reason most everyone will opt in is beca…
Sharing location with apps is trivial to avoid (just don't use them if you're not comfortable), it's not an iphone secret file that stores everything until someone exposes it (zing!). Besides, 'you are on main street' vs 'your daughter has herpes' are far different levels of invading privacy, the former is not a particular secret at all.
Re: The Facebook Fallacy
#8The key problems for online advertising are:
1. Advertisers can see if it worked. In traditional advertising you accept that a lot of your money will be "wasted" on people who will never buy your product or service. In online advertising you can track a customer from first viewing an ad to purchase. This gives advertisers a lot of leverage in price negotiations -- "your site only has a 0.05% conversion rate, why should I pay that much?"
2. Inventory is growing faster than demand for inventory. In advertising terms "Inventory" means "I have a place to show your ad". Well every new web page can contain inventory. Given how fast the supply of webpages is growing, compared to the total pool of customers and businesses ... well let's just say that the supply-demand curve on this does not favour the sellers of inventory.
I am of course fascinated by this problem and my startup (currently in stupid unfunded single-founder mode) aims to resolve this exact economic problem with a different model.
Re: The Facebook Fallacy
#9I don't like ads (typically). But as ads get more and more targeted (ie., when i haven't gone to the dentist in 2 years and the ad says, "great dentist with promo offer just 2 miles from you", that's kind of enticing). I think it will migrate to where ads need to be helpful (ie., google ads). Search was easier because Google could target on the search term. But it's harder when the user isn't proactively searching fo…
TV ads are poorly targeted yet businesses are pouring billions into it.
I don't believe the hype. Ads do work, and web ads are even better.
Not only are some ads personalized, but they also have a call to action. There are many times where I can make the purchase right then and there.
The experience will get better over time and I'm sure in the near future online advertising will own the biggest piece of the $ pie.
Re: The Facebook Fallacy
#10Advertising is a $600B a year business, and the Internet still has yet to catch up with other media in terms of share of total budget versus time spent on the medium.
Google just reported revenues up 35%. It's all advertising, driven by high quality algorithms and lots of data. Internet advertising is more effective than other media and we're still just scratching the surface.
I'd like to comment on all the specific ad startups and their revenue and growth rates but I'm not able - you'll just have to wait and see it.
Happy to make a $1 bet on the subject with any naysayer here or with the author of this shoddy article.