
Do-Not-Track and the Economics of Online Advertising [pdf] - cpeterso
https://5harad.com/papers/do-not-track.pdf
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CrazyCatDog
I don't buy the pivotal assumption:

"Among the top 10,000 sites that show third-party capable advertising, we find
that on average 15% of users visit the site at least 10 times per month, with
the more popular sites tending to have more loyal visitation. We further
estimate that if one-fourth of such loyal users ultimately subscribe to the
sites they visit, a monthly fee of $2 would generate revenue comparable to the
entire stream from third-party advertising, based on current ad rates"

Why? Because the friction associated with paid subscriptions is still
prohibitive, especially when the natural tendency is to evaluate the
subscription decision (monthly recurring fee) in light of reading a _single_
article.

The notion of a fluid, browser-based payment system could easily overcome
these frictions by allowing users to trivially pay a nominal fee to access any
individual piece of content.

While I can see Microsoft backing Do-Not-Track lobbying to weaken the threats
coming out of the Bay Area; any browser-based content solution will likely
strengthen the same companies who now control internet advertising.

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kevinskii
_Text of the Abstract:_

"Retailers regularly target users with online ads based on their web browsing
activity, benefiting both the retailers, who can better reach potential
customers, and content providers, who can increase ad revenue by displaying
more effective ads. The effectiveness of such ads relies on third-party
brokers that maintain detailed user information, prompting privacy legislation
such as “do-not-track” that would limit or ban the practice. We gauge the
economic costs of such privacy policies by analyzing the anonymized web
browsing histories of 14 million individuals. We find that 3% of retail
sessions are currently initiated by ads capable of incorporating third-party
information. Turning to content providers, we find that one-third of traffic
is supported by third-party capable advertising, and the rate is particularly
high (91%) for online news sites. Finally, we show that for many of the most
popular content providers, modest subscription fees of $1-3 per month charged
to loyal site users would be sufficient to replace ad revenue. We conclude
that do-not-track legislation would impact, but not fundamentally fracture,
the Internet economy."

