
Do-Not-Track and the Economics of Third-Party Advertising - cpeterso
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2505643
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arjie
The key assumption, I think, is here:

> Among the top 10,000 sites that show third-party capable advertising, we
> find that typically 15% of users visit the site at least 10 times per month.
> If one-fourth of such loyal users ultimately subscribe to the site, we
> estimate that a monthly fee of $2 would generate revenue comparable to that
> earned from third-party capable advertising, based on current ad rates.

~~~
eli
Seems like quite an assumption that 1/4 of loyal readers will pay for a
website. They cite the NYTimes paywall as evidence, but the NYTimes is hardly
a typical site or a typical brand.

~~~
pessimizer
That's probably due to the 15 odd years of a lack of micropayments on the web,
though. I'd pay $2 monthly for every one of the (very few, maybe 15-20) sites
that I visit in return for privacy guarantees and no irrelevant advertising.

~~~
eli
Unfortunately it's difficult to pull off a model where users can pay to turn
off ads because it drastically reduces the per-user value of the remaining ad
impressions.

~~~
cpeterso
Few people use ad blockers. Less than 7% of Firefox users have Adblock Plus
installed:

[https://addons.mozilla.org/en-
US/firefox/compatibility/33.0](https://addons.mozilla.org/en-
US/firefox/compatibility/33.0)

------
protonfish
The real question I have is: Do ads served based on a person's history
generate more clicks/sales than ads based on the relevance to associated
content, or even randomly selected? My subjective experience with targeted ads
is poor - they seems to be ads for stuff I already bought and therefore, don't
need anymore.

~~~
gzervas
Hi, co-author of the paper here. To answer your question, yes, there is
evidence to suggest that targeted ads work better:
[http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1600259](http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1600259)

