This is the year that advertising will start to lose its grip on the internet as companies finally realise that people are willing to pay for an internet that is utterly ad-free.
2021 will see the end of the online world’s love affair with “free” online services, argues Sridhar Ramaswamy, former SVP of Google Ads.
We all now understand that receiving “free” content and services means enabling the supplier to rely on advertising income to make money. Those ads started innocuously, but they have now become unwelcome and unwieldy, and many are designed to closely relate to content, leading to a confusion between editorial and marketing. In addition, they have led to a world where companies track everything a consumer does online to serve them even more ads.
In 2021, it's likely that we will see the rise of a new class of services that are paid for and ad free, and thus have no incentive to track an individual’s every move across the internet. Companies will build products that are founded on a simple business model and focused on just the customer. The customer, meanwhile, will pay a fee, but will realise they are getting value for money. Afterall, if you don't pay for carefully researched, edited and curated news, it's likely to be inaccurate or, bluntly, false. Or, to use the modern day parlance: fake news.
Entertainment providers such as Netflix, Spotify and HBO have always been paid for, but now we are seeing other providers adopt this model. News providers like The Times, Washington Post, The Economist and the Financial Times, long ago put up pay-walls. If you want to read their content, you need to subscribe.
In the productivity sector, companies such as Superhuman and Hey, which market email applications, are also taking this approach.
There are two significant advantages to the paid-service model. Companies that adopt it will have a single focus, the customer, rather than having to satisfy advertisers too, and they will be able to innovate and use scale to serve them better. Moving away from “free” will also help the online world satisfy understandable regulatory concerns about data privacy. If there are no advertisers to share customer data with, that data will remain safe.
There’s no doubt that the idea of “free” helped kickstart the vibrant online ecosystem we have today, and while there will always continue to be a market for “free” services, 2021 will likely mark a turning point that will give rise to the paid-service model.
When Ramaswamy was at Google, he saw how the never-ending temptation to adopt a slightly more aggressive approach to adverts ultimately led to a poorer experience for the consumer. The time has come for the internet grow up into a world where consumers are happy to pay for quality products and services, and the grip of advertisers over our online life is weakened.