As more entrepreneurs, thought leaders and tech savants openly discuss Web 3.0, the elusive — and somewhat inadequately understood — concept has been brought to the forefront of the internet privacy conversation.
Long gone are the days when users stand by as companies monopolize user data and dictate how one is allowed to behave online. The concentration of big data in the hands of a select few has raised many an eyebrow and prompted the need for change.
User privacy remains an issue to this day. Web 3.0 aims to give full control back to the users and decentralize the internet. If that were to happen, what would it spell for advertising, and who’d stand to benefit?
What is Web 3.0?
The highly anticipated arrival of Web 3.0, otherwise known as Web3, naturally suggests the existence of Web 1.0 and Web 2.0. You may have heard of these two milestones in the internet’s history — they’re terms that describe the web in each of its iterations and how it changed and developed over time.
Take Web 1.0 for example. It was the first iteration of the internet to be a globally available phenomenon that millions had access to. It would be fair to assume that many people still remember what the web was like in the late ‘80s and ‘90s. Basically, it was a collection of static pages that offered little in the way of interaction, other than the ability to read content published by a few individuals who had the know-how.
The internet was fairly monotonous and straightforward until the launch of soon-to-be media titans — YouTube and Facebook. Both allowed users to publish content of their own without too much effort. But it wasn’t just social media platforms and video streaming that gave rise to Web 2.0 in 2006. Developing and hosting a website became effortless as well, allowing more people to be involved in the internet landscape, even if they had no knowledge of HTML or server operations.
However, while these platforms made content creation easy and readily available, it also led to the massive centralization of data, which subsequently sparked issues with monopoly, surveillance and over-regulation.
That’s where we’re at right now. We’re over-reliant on Google, Facebook (Meta) and other tech giants to provide the framework for all of the internet. Web 3.0 is poised to change all this by shifting the internet from a privately owned infrastructure to a decentralized framework running on the blockchain.
Blockchain’s public ledger design coupled with consensus algorithms and greater transparency is the perfect framework for the next great internet evolution. Web3 will run on the blockchain, use crypto and rely on the immutability of data. Most importantly, Web3 will give users full control over their private data and grant everyone access to revolutionary financial systems.
That’s the current vision of Web 3.0. How its implementation will differ remains to be seen.
Shaking the walled gardens
The web is, by nature, a decentralized system of communication. TCP implementations require no one to be in charge, so long as everyone agrees to follow the same rules, i.e., protocols while remaining tolerant of any deviations or potential faults in communication. It was, on paper, an ideal foundation for a decentralized network that unfortunately didn’t take into account the potential for abuse.
It also didn’t successfully predict how much data some of the actors would accrue over time. Facebook, Amazon and Google were able to position themselves as industry leaders in the post dot com crash and amass a wealth of data that would put them ahead of all the competitors for years to come. Centralization at such a grand scale was never thought possible up until then.
However, despite the grim outlook for an internet free of monopoly and surveillance, it’s not the first time centralization has taken hold, and it likely won’t be the last. The cycle of centralization and decentralization has been happening for decades now.
Just as PCs decentralized computer ownership, so did the internet and a wealth of free online tools, which broke the hold that Microsoft had on PCs. Then, the “free” internet was gone and centralized by large companies. We are, yet again, looking for another decentralization cycle to break the stranglehold that a powerful few have on the internet.
Web 3.0 is positioning itself as a way out of the mess we find ourselves in at the moment. It appears to be the next cycle: the one that will take us out of the over-regulation and give a portion of control back to the users.
A brave new world of tokenized direct deals
What does all of this mean for advertising? Well, first and most importantly, users are about to acquire full control over their data. Web 3.0 does away with not only third-party data but also first-party. Advertisers are looking at a zero-party future where users themselves detail what information they would like to share and with whom.
Secondly, any framework that relies on blockchain brings more honesty and transparency to every deal you can make online. The same goes for advertising. The relationship between advertisers and publishers has been corrupted by countless intermediaries who, at first, wanted to facilitate ad inventory buying, but ended up creating a wasteful system vulnerable to fraud. SSPs, DSPs and ad exchanges are the main ad tech intermediaries, and as such, all stand to benefit from the wastefulness they cause for publishers and advertisers alike.
With Web3, we can finally look forward to more direct deals and fewer intermediaries looking to get rich off others. Take Brave Ads for example. They offer BATs, or Basic Attention Tokens, that advertisers can buy using fiat currency and then trade to publishers for the unique attention of their visitors. Companies that work directly with publishers and advertisers, including MGID, also stand to benefit from a paradigm shift in advertising.
Perhaps the biggest change you can expect is users being paid to see ads. Since they’re in full control over their data, advertisers will get more bang for the buck by targeting a unique and interested audience that’s willingly sharing their data. It’s the best kind of audience for any advertiser. To put it simply, with Web3 everyone stands to gain something.
Web 3.0 is bound to give control back to users. With more agency in how their data is handled and by whom, users stand to benefit from better security and privacy. Advertisers will have to adapt to this new reality; however, seeing as how wasteful ad tech is at the moment, Web3 seems to be the next best thing for everyone involved.