Do we want to pay for content on the internet? 

In 2020, IAB Europe conducted a survey asking Europeans what version of the Internet they would prefer: with no targeted ads but with mostly paid content, or today's model with mostly free content but with targeted ads. The vast majority of 75% refused to pay for online content. However, the version with paid content would become reality if targeted advertising, which “finances” the internet "for free", got restricted or banned. This may happen as a result of the work of some Members of the European Parliament. 

You may have already heard about the debate over the new European regulations for large internet companies called the Digital Services Act or Digital Markets Act. These draft laws have the ambition to regulate virtually all aspects of Internet life on large platforms. Currently, the functioning of online advertising has become a key question. Originally, the European Commission wanted to do the unnecessary and increase the transparency of online advertising - i.e. to let us know why a particular ad is appearing on the Internet. Today, for example, Facebook or Google already provide this information to their users.

Now, however, it seems that some MPs are determined to go even further. These are mainly members from the Green and Social Democrats ranks who have decided to be more papal than the pope and proposed to limit targeted advertising. So far, there does not seem to be a complete agreement on this proposal in the European Parliament, but even so, this initiative is worth our attention. So, what are targeted ads and what's at play? 

Targeted ads are based on information about our online behavior, physical location, or demographics such as gender or age. In 2017, 66% of online digital advertising revenue was based on such targeting, and advertisers are willing to pay up to 2.68 times more for targeted ads compared to the so-called contextual ads. These are the ones that don't target specific users but appear in context - such as a refrigerator ad on a food blog. The fact that advertisers are willing to pay more for targeted ads demonstrates their greater effectiveness, as evidenced by studies that show that non-targeted advertising can reduce publishers' revenue by up to 40.3%. 

The fear that the "big brother" is watching us is understandable. But the question of privacy is not a binary one (yes, no) but rather a question that each one of us should be entitled to answer for himself. Today, we have a few tools, applications, and settings that we can use to "defend" ourselves. For example, the DuckDuckGo internet browser or communication applications such as Signal. However, we need to defend ourselves only where it makes sense to us and not where it makes sense to the public officials. On the contrary, if we leave it to the officials, it can easily happen that, through their catch-all prohibitions and restrictions, they erase one whole segment of the economy that has helped many small businesses, helps run many publishing houses and brings benefits to the customers themselves. How? 

Today, we are used to the amount of content on the Internet being free. However, its creators are not breatharians, they do not live of the air. They live thanks to targeted ads. With less effective ads, many of these people would lose the opportunity to publish and create. It would cost ordinary consumers who have become accustomed to the fact that advertising is often an interesting proposal, whether to buy a gift, use a service or participate in an interesting event. If we limit targeted advertising, surfing the Internet will become as boring as watching billboards along a first-class road between Bratislava and Senec. 

From the perspective of small and medium-sized businesses, limiting targeted ads will reduce their ability to survive in tough competition with larger players with generous marketing budgets. Non-targeted digital advertising has a 5.3-fold lower click-through rate than targeted, which is especially important for start-ups who count every euro in their hands. 

By proposing to ban or restrict targeted ads, someone is obviously doing unnecessary overtime under the guise of privacy. If vast majority of people want to keep targeted ads in place, adopting a ban would be an excellent example of completely unnecessary regulation. At a time of COVID-19 crisis, when we need to help our small businesses survive, and at a time when the EU wants to become a digital leader in the world, similar steps are sending a very bad signal.