A reply to Ethan Zuckerman

There’s a great piece in The Atlantic this month on advertising, the internet’s “original sin”, by MIT’s Ethan Zuckerman. Advertising, he argues, has stripped us of our privacy, to the point of normalizing constant online surveillance. Add to that the fact that it’s not yet clear how well even these sophisticated data-heavy ad products are at actually making money — at least for companies without the scale of a Facebook — and it’s hard to disagree with the sentiment that the internet deserves something better.

But what?

Here I want to push back a bit. The example that Zuckerman cites is Pinboard, an online bookmarking service that charges its users. (Full disclosure: I am pretty sure I’m the last active Delicious user on the planet.) Pinboard has an appealing premise:

Why Pay For Bookmarking?

It boils down to this: running a web service costs money. If you’re not paying for your bookmarking, then someone else is, and their interests may not be aligned with yours.

This is what Zuckerman has in mind when he writes:

One simple way forward is to charge for services and protect users’ privacy, as Cegłowski is doing with Pinboard. What would it cost to subscribe to an ad-free Facebook and receive a verifiable promise that your content and metadata wasn’t being resold, and would be deleted within a fixed window? Google now does this with its enterprise and educational email tools, promising paying users that their email is now exempt from the creepy content-based ad targeting that characterizes its free product. Would Google allow users to may a modest subscription fee and opt out of this obvious, heavy-handed surveillance?

I should say, I love this option, and think it would be an improvement from the status quo. But I’m not sure this is actually the most plausible alternative to ad-supported sites and services.

Let’s take the hypothetical further: what if tomorrow advertising were no longer an option for web services and content providers? We’d see some users paying up for things like Pinboard, certainly. Perhaps even for a Facebook subscription.

But I’d argue for another possibility: that we’d continue to get lots of these services for free, minus a modest hosting fee paid to a separate party.

The site you’re reading right now runs on WordPress, an open-source content management system for which I pay nothing. My only cost is a few dollars a year to a hosting provider to keep the site online. This hosting provider has no connection to the company behind WordPress* or the community of WordPress developers who help maintain it.

That’s subtly different from the Pinboard model (which again, is a great model) in that the software comes free. All I’m paying for is storage, and storage is cheap.

If suddenly advertising weren’t an option, whether because it turned out to be a terrible business model or because we decided we cared about privacy, my hope is that something closer to the WordPress + hosting model might spring up to replace it.

You’d pay a few dollars a month for some storage somewhere, which in turn would offer, at a click of the button, installation of the various open source software packages to support things like social networking. These services would no longer be centralized, and so would work a bit more like email or RSS, but fundamentally most users probably wouldn’t even recognize the difference.

This distinction matters, in part because I suspect it’s bound to disappoint some people. For those interested in privacy, both alternatives are good. For those interested in as many people using the internet for as many things as possible, the cheaper, open alternative is better. But for those whose real interest is in getting paid, the open alternative is a disaster.

That’s not what Zuckerman or Pinboard creator Maciej Cegłowski are about. But my sense is there’s a serious faction of web-ad haters for whom this is the primary gripe. This is particularly true on the content side, where — as opposed to for software — an increasing number of workers find their skills no longer in demand.

To this group, the idea of customers just forking it over already feels righteous. And so it’s worth noting that, if advertising went away, that’s not mostly what would happen.

In fact, the shift to “open” content would work even more seamlessly than for web services. Making consumers pay to access any professional content might increase purchases on the margin, but more than that it would shift attention away from the pros and toward the amateurs. Independent blogging would come back in vogue, and we’d discover that, while the average amateur can’t create as engaging a list of images as the average pro, thousands of amateurs giving it a try will in a lot of cases produce something about as good. Luckily, the internet is great at filtering up that one good one, and bringing it to everyone’s attention. This model doesn’t work for everything, particularly certain expensive and time consuming kinds of journalism. But for, say, political commentary, it works better than lots of paid commentators care to admit.

All of which makes me agree even more wholeheartedly that ad-backed business models aren’t an ideal way of supporting the internet. But if they suddenly went away, don’t expect me and everyone else to start paying up.

*It’s true that WordPress wouldn’t be where it is without Automattic, the company its founder created around it. But that’s not the only model for open source development. It’s certainly possible to offer mature, first-class open source software without a single company at the center, driving the initiative. My hope is that this is what we would see increasingly on an internet that relied less heavily on ads.

The mobile media paradox

Mobile apps are dominating media consumption, but getting users to use your app is really, really hard:

U.S. users are now spending the majority of their time consuming digital media within mobile applications, according to a new study released by comScore this morning. That means mobile apps, including the number 1 most popular app Facebook, eat up more of our time than desktop usage or mobile web surfing, accounting for 52% of the time spent using digital media. Combined with mobile web, mobile usage as a whole accounts for 60% of time spent, while desktop-based digital media consumption makes up the remaining 40%.

Apps today are driving the majority of media consumption activity, the report claims, now accounting for 7 our of every 8 minutes of media consumption on mobile devices. On smartphones, app activity is even higher, at 88% usage versus 82% on tablets.

So apps are where media gets consumed. But that doesn’t mean media companies should throw all their efforts at mobile apps. Because getting users to download and use those apps is incredibly difficult:

Only about one-third of smartphone owners download any apps in an average month, with the bulk of those downloading one to three apps. …a “staggering 42% of all app time spent on smartphones occurs on the individual’s single most used app,” comScore reports.

For most media companies, taking advantage of mobile apps means optimizing content for the mobile apps of Facebook and Twitter, and for email. That might not sound ideal — no one wants to be dependent on a monolithic third party like Facebook to deliver their product — but that’s how it is, for now at least.

How to promote economic growth, in 1 paragraph

To hear pundits talk about it, it’s easy to conclude that we have no idea what policies will help with economic growth. After all, we’re debating whether we’re stuck in stagnation or about to witness a new era of technology-led expansion. But there are a set of policies the majority of economists believe will be growth enhancing, and — spoiler alert — cutting taxes isn’t on the list.

This is from a Foreign Affairs essay on automation and the economy by Erik Brynjolfsson, Andrew McAfee, and Michael Spence:

As for spurring economic growth in general, there is a near consensus among serious economists about many of the policies that are necessary. The basic strategy is intellectually simple, if politically difficult: boost public-sector investment over the short and medium term while making such investment more efficient and putting in place a fiscal consolidation plan over the longer term. Public investments are known to yield high returns in basic research in health, science, and technology; in education; and in infrastructure spending on roads, airports, public water and sanitation systems, and energy and communications grids. Increased government spending in these areas would boost economic growth now even as it created real wealth for subsequent generations later.

That’s not to say growth is primarily a factor of policy. No doubt it’s exogenous to a significant degree. But that sort of agenda would almost certainly help.

The essay overall is a concise summary of the global pressures on labor (and even capital) created by digital technologies, and for the longer version Brynjolfsson and McAfee’s recent book The Second Machine Age is also quite good.