DaveNet: Tuesday, June 17, 1997; by Dave Winer.
Dan Farber on Web Economics
I've been friends with Dan Farber, dan_farber@zd.com, for almost thirteen years. Dan started in the IDG world of PC magazines at PC World and MacWorld, and then went to Ziff where he was editor in chief at MacWEEK and PC WEEK and then started and now manages ZDNet. Dan is one of the leading decision-makers of the web content world.He had comments on my Web Economics piece, 6/12/97:
Dan Farber on Web Economics
People will have more control over the content as personalization technology improves. If the content is exposed in a structured way, users can create their version of a channel (web site) or across several channels. Triggers, alerts, and adaptive behavior will also be a part of a smarter web environment.
Excluding ads or graphics of a specific size, or filtering offensive language, is a part of that environment as well because technology makes it possible. But the possiblities of the technology don't always translate into practical realities.
Some people may want to avoid ads, but advertising is an important part of the web economic system. If ads were not part of a page view, you would be paying much more than a few dollars for a copy of PC Mag; similarly, viewers of web pages would have to pay some kind of subscription or microtransaction fee to cover the cost to deliver content of perceived value.
The majority of people consuming content know what role ads play, especially in special interest publications where the ads are aligned closely with the buying interests of the target audience. As the technology evolves, precision targeting of ads on the web will serve as an intelligent filter for viewers and advertisers; you get the editorial content and advertising information about the products and services that relate to your specific interests.
Advertising is a form of content. It's as ancient and persistent as any other kind of information. The web offers a new infomarket in which ideas, goods, and services can be tightly linked. Viewers are smart enough to know the difference among the various content types. It's part of our cultural heritage. We need to make sure that those boundaries -- between edit and ads, for example -- are clearly marked and that rules of professional journalism are practiced no matter what the medium.
And while some attempts to charge for content on the web have not been particularly successful so far, the predominant model of the content for free and pay for access will not be as pervasive over time. People will pay for high quality content as they pay for magazines and other media they want to consume today.
It's also good to remember that most print publications take years to become profitable. The economics of the web can lower that timeframe, but you still need a compelling editorial offering and a revenue stream to make the appropriate investments.
We shouldn't base our expectation on what we see today as the web because it is evolving rapidly. The Internet is an integrating medium, over the next few years the concept of banner ads will seem primitive compared to what will evolve for all forms of content.