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Advertising on the web as we know it has gone through good times and bad times. Now it may be going through end times. Privacy concerns, security breaches, and perhaps even government regulations will drive changes.

Dave Methvin

December 20, 2010

2 Min Read

Advertising on the web as we know it has gone through good times and bad times. Now it may be going through end times. Privacy concerns, security breaches, and perhaps even government regulations will drive changes.The core of the problem lies with the way that big ad networks are run. Sites want to run ads that are in big networks such as DoubleClick (now owned by Google) or Google AdWords so that they can take advantage of the largest possible market. Advertisers can place ads on those networks, and the network algorithms will fine-tune the exposure to maximize the clicks across thousands of different sites.

On the surface, large markets like this appear to be efficient for both advertisers and publishers, but they have significant drawbacks. Fraud is a particular problem. The ad networks are so big that it's easy to hide all sorts of seedy practices. Advertisers can't be sure that the clicks they were charged for were from real potential customers, or just from a competitor trying to drain their ad budget. The whole process isn't very transparent, so it's not even clear that ads were truly displayed when the ad networks say they are. They're just numbers in a report, unaudited by any trustworthy party. Things are even worse for content publishers who run the web sites where these ads are displayed. Just about every large ad network has had a major embarrassment of being tricked into delivering malware or other exploits via Javascript ads. Even the New York Times web site has delivered these ads in the past. As a result, both the ad networks and web sites will need to take more responsibility in the ads that are displayed. To ensure that the ads delivered are legitimate, the practice of simply referencing Javascript directly off the advertisers site may need to stop. (Several of the worst ad exploits involved the advertiser submitting an ad to a web site for approval, then switching it out for something scummier and scammier during times when they knew the site's staff wouldn't be looking.) The main problem is one of trust. When a web site puts a script tag onto their site that loads Javascript from an ad network, it's asking you to trust both sites. The big ad networks have shown that they often aren't worthy of that trust. Utilities like AdBlock for Firefox and Chrome have allowed savvy users to selectively or completely block advertising, and this trend will accelerate with Internet Explorer 9 which includes ad blocking as well. Web sites need to find a way to finance their operations; advertising is still a useful model for that. However, the specific ways we're doing that today, via dangerous script tags served by untrustworthy ad networks, has to change if advertising is going to continue to be successful.

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