{"id":608896,"date":"2023-10-26T00:00:00","date_gmt":"2023-10-26T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2023\/10\/26\/why-were-seeing-so-many-online-ads-and-how-its-about-to-get-worse\/"},"modified":"2023-10-26T00:00:00","modified_gmt":"2023-10-26T00:00:00","slug":"why-were-seeing-so-many-online-ads-and-how-its-about-to-get-worse","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2023\/10\/26\/why-were-seeing-so-many-online-ads-and-how-its-about-to-get-worse\/","title":{"rendered":"Why we\u2019re seeing so many online ads, and how it\u2019s about to get worse"},"content":{"rendered":"

We <\/strong>do not<\/a><\/strong> like seeing ads, <\/strong>and the 290 mn<\/a> people worldwide who use ad blockers think so, too \u2014 despite what Mark Zuckerberg, CEO of Meta, thinks<\/a>. Even Marc Pritchard, Chief Brand Officer at Procter & Gamble \u2014 the world\u2019s biggest advertiser \u2014 agrees that consumers will take any chance to skip online ads, according to Forbes<\/a>. But when the digital ad industry is worth USD 627<\/a> bn, who cares what people think?<\/p>\n

We are seeing more ads today than any other human <\/strong>beings<\/strong> in history. <\/strong>A study<\/a> conducted in the 1970s revealed that, on average, an individual would see between 500-1.5k ads a day. Today, we see at least 10k<\/a>. 80% of Google\u2019s revenue<\/a> is generated from the ads you see next to search results. Meta owes over 90%<\/a> of the bns they make to ads, as do Amazon<\/a>, Apple<\/a>, Youtube<\/a>, and even Microsoft<\/a>. Over the past year<\/a>, people have noticed that ads are becoming more widespread, and more annoying. The bad news? It\u2019s about to get worse.<\/p>\n

Why will we be seeing more ads? <\/strong>There are a few reasons: The first being an increase in privacy. Data privacy laws entered a new era<\/a> in 2023, making it harder to collect user data and create targeted ads. To get ahead of the curve and avoid fines for violating these laws, big companies have been locking their platforms<\/a> down \u2014 you may notice these changes in things like your iPhone asking if you\u2019d permit an app to track your phone usage. Saying no (the appropriate response) cuts off the flow of data, which means cutting off the flow of money to companies that rely on ads. While untargeted ads may still pop up, they don\u2019t generate as much money. So the solution is ad loading \u2014 showing the user more ads to compensate for the loss of a revenue stream.<\/p>\n

Another big reason is the changing economic landscape. <\/strong>The US government has raised<\/a>interest rates<\/a> from near zero to over 5.25% over 19 months to try and control inflation. This makes it harder and less financially-sound for US-based companies to take out loans, drying up a lot of the runway that tech companies have been exploiting. Up until now, Silicon Valley has operated on the model of selling goods and services to consumers for less than they actually cost, with the end goal of crushing competitors and jacking up prices once they monopolize the market. As the economy tightens, investors and venture capitalists are being more cautious, and more insistent on evidence of return on investment. How do you magically reveal a new revenue stream to keep investors happy? Yes, you guessed it: Adverts. <\/p>\n

Now, companies want us to be both the paying customers and the product<\/strong>.<\/strong>Remember when Twitter was with no charge? Remember when Netflix didn\u2019t play ads? Or YouTube? Meta is now testing a USD 14 ad-free subscription<\/a>. X\u2019 Premium subscription going for USD 8 a month will only let you see 50% less ads<\/a>. TikTok is also dipping its toe in the ad pool, testing a USD 4.99 ad-free platform<\/a>. Now that the biggest social media companies are going to make money from premium access to their platforms, life for those unwilling to pay is about to get much worse.<\/p>\n

Creating a premium fee for a better experience <\/strong>is an incentive<\/strong> to make things worse.<\/strong> To justify subscriptions and encourage users to sign up, these platforms may intentionally make their services worse to force your hand. This is called calculated misery<\/a>, and it\u2019s been in practice for decades. You can thank air travel for this. How do you make more money on flights when everyone on the plane will be arriving at the same place anyway? You make it horrible. By making lower-priced seats more uncomfortable and the whole experience more unpleasant, frequent flyers will be compelled to pay more for a more enjoyable experience.<\/p>\n

First, everything that used to be at no cost is taken away. <\/strong>In 2014, a study<\/a> revealed that today\u2019s biggest economy plane seats are tighter than the smallest economy plane seats offered in the 1990s. Time Magazine expects it will get worse<\/a>. And the same will happen on social media. Just like you\u2019re allowed less baggage per flight, paying more for extra suitcases, and having to pay to choose your seat, you now have to pay to watch a video on Youtube sans ads. Netflix<\/a> has recently followed suit<\/a>. Elon Musk was teasing<\/a> the possibility of the same perk on X, when it was still Twitter. And how is this calculated? By not making things irritating enough to leave, but keeping it irritating enough that you consider paying a fee for a better experience.<\/p>\n

\u201cIf you don\u2019t like it, just leave.\u201d <\/strong>When every airline is pretty much offering the same experience, you have no alternative. Cough up more money or be miserable. And sure, social media is easier to opt out of than refusing to fly to another country ever again, but the infrastructure of social media and its integration into the fabric of our lives makes it difficult. If you delete all your social media accounts right now and decide to stop using streaming services, you are effectively opting out of communicating with your friends and family, and making it impossible for yourself to participate in popular culture. Is it possible? Yes. Is it practical? Not so much.<\/p>\n

It doesn\u2019t have to be this way, but it\u2019ll get much worse before it gets better.<\/strong> Believe it or not, our saving grace might be bad UX. Terrible user experience may create a gap in the market. Because we hate ads so much, if a competitor pops up that promises not to plague our feed with them, essentially offering a premium service without the price tag or the calculated misery, people will flock there. Some competing tech companies might go out of business, which means less pressure on the remaining survivors to turn a net income, and less incentive to use ads\u2026 unless corporate greed gets in the way. But we choose to be optimistic. It may get better in the future, but in the meantime, we have a lot of ads to look forward to.<\/p>\n","protected":false},"excerpt":{"rendered":"

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The acquisition marks Aleph Holding\u2019s first investment in the MENA region as it aims to expand its\u2026","rel":"","context":"In "SPEED ROUND: STARTUP WATCH"","block_context":{"text":"SPEED ROUND: STARTUP WATCH","link":"https:\/\/enterpriseam.com\/egypt\/category\/speed-round-startup-watch\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/2021\/7\/428.jpg?fit=%2C&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":574833,"url":"https:\/\/enterpriseam.com\/egypt\/2020\/09\/23\/ads-are-still-exempt-from-vat-but-not-stamp-tax-and-vat-on-production-inputs\/","url_meta":{"origin":608896,"position":2},"title":"Ads are still exempt from VAT, but not stamp tax and VAT on production inputs","author":"enterpriseam admin","date":"23 September 2020","format":false,"excerpt":"Broadcast ads are exempt from VAT, but subject to stamp tax and VAT on production inputs: Intermediary goods and services used to produce ads are subject to a 14% value-added tax (VAT), the Tax Authority said in a directive (pdf) to clarify how tax legislation treats ads. The cost incurred\u2026","rel":"","context":"In "Speed Round"","block_context":{"text":"Speed Round","link":"https:\/\/enterpriseam.com\/egypt\/category\/speed-round\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/2020\/9\/254.jpg?fit=%2C&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":596348,"url":"https:\/\/enterpriseam.com\/egypt\/2019\/08\/26\/govt-could-impose-5-10-schedule-tax-on-social-media-ads\/","url_meta":{"origin":608896,"position":3},"title":"Gov\u2019t could impose 5-10% schedule tax on social media ads","author":"enterpriseam admin","date":"26 August 2019","format":false,"excerpt":"EXCLUSIVE- The government is looking to impose a 5-10% schedule tax on social media and internet search ads on top of the 14% VAT as part of anticipated amendments to the VAT Act, government sources told Enterprise. Schedule tax is a type of sales tax imposed on some luxury goods\u2026","rel":"","context":"In "Speed Round"","block_context":{"text":"Speed Round","link":"https:\/\/enterpriseam.com\/egypt\/category\/speed-round\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/internal\/536550.png?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":565565,"url":"https:\/\/enterpriseam.com\/egypt\/2021\/04\/15\/we-watched-all-the-ramadan-ads-to-spare-you-the-pain\/","url_meta":{"origin":608896,"position":4},"title":"We watched all the Ramadan ads to spare you the pain","author":"enterpriseam admin","date":"15 April 2021","format":false,"excerpt":"We watched all these ads so you don\u2019t have to: Love them or hate them, TV ads are a hallmark of Ramadan as the nation\u2019s creative directors cram maximum creativity into 30 days. As with every year, some of these are groundbreaking, some are funny, some of these fall flat,\u2026","rel":"","context":"In "Worth watching"","block_context":{"text":"Worth watching","link":"https:\/\/enterpriseam.com\/egypt\/category\/lifestyle\/worth-watching\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/2021\/4\/435.jpg?fit=%2C&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":623582,"url":"https:\/\/enterpriseam.com\/egypt\/2024\/06\/06\/say-goodbye-to-carefree-scrolling-on-instagram\/","url_meta":{"origin":608896,"position":5},"title":"Say goodbye to carefree scrolling on Instagram","author":"enterpriseam admin","date":"6 June 2024","format":false,"excerpt":"Instagram has started testing a feature that forces users to watch ads mid-scroll","rel":"","context":"In "FOR YOUR COMMUTE"","block_context":{"text":"FOR YOUR COMMUTE","link":"https:\/\/enterpriseam.com\/egypt\/category\/for-your-commute\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/2024\/6\/542.jpg?fit=%2C&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]}],"_links":{"self":[{"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/posts\/608896","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/comments?post=608896"}],"version-history":[{"count":0,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/posts\/608896\/revisions"}],"acf:post":[{"embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/afternoon\/608880"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/media\/608897"}],"wp:attachment":[{"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/media?parent=608896"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/categories?post=608896"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/tags?post=608896"},{"taxonomy":"brand","embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/brand?post=608896"},{"taxonomy":"newspack_spnsrs_tax","embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/newspack_spnsrs_tax?post=608896"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}