The Perfect Storm: Web3 and the future of the web – Part I

The future of the web; Web3 is touted as the next phase of the internet some call it the perfect storm. It promises to be a more open, free and less centralized network in the hands of big technology like Google, Meta or Amazon. The term has been coined for a few years, but it is in recent months that it has become more fashionable and, of course, has caused both enthusiasm and skepticism about the future of the web.

Technological analysts like Scott Galloway, professor of marketing at the Leonard Stern School of Business at New York University, do not question the innovation component that web3 has, but they are more reluctant to the promise that it will be a decentralized internet than can empower ordinary citizens.

The most idealistic believe that web3 will take power away from the so-called ‘walled gardens’, as the big platforms like Facebook and Google are called that keep their technology, information and user data for their own purposes. Skeptics believe that web3 will be a kind of re-centralization, i. e., new groups controlling the internet.

The Google-Facebook Duopoly

One of the most important benefits that the development of Web3 (the future of the web) brings is the decentralized ad exchange, that is to say that users are not seen as products, in fact Alkimi Exchange is already in the its built process, being the first in the world in carrying it out.

In itself, programmatic advertising consists of the use of software algorithms in the purchase of digital advertising.

Traditional online advertising systems involve a large amount of human intervention when requesting advertising space and negotiating prices. Now, this entire system is done automatically, saving time and resources and achieving more targeted and efficient ad placement.

Programmatic advertising targets people, not ad space. Unlike conventional display advertising, programmatic advertising allows us to target each user based on their profile and behaviors, making ads much more relevant to them.

On the other hand, there are many users who are concerned about the insecurity of the privacy of consumer data and the continuous phases of Google’s third-party cookies. But what is the relationship between programmatic advertising and cookies?

Well, precisely Web3 and programmatic advertising try to eliminate cookies, i. e., the collection of data from users who browse different web pages. This information will help them deliver the most relevant and specific content to specific audiences. Among these contents, digital advertising would also be included.

And it is that, cookies have been the technology that has supported and financed since the beginning of the 90s, the fictitious agreement to obtain “free” content on the Internet.

As you know, nothing in life is free, and the Internet is no exception. In reality, an offer occurs every time you consume free online content. Web publishers offer you their content; advertisers agree to fund that content by paying for ads. And the user agrees to give mountains of personal data to hundreds of companies in the digital advertising industry, whether he realizes it or not. And this ‘dummy contract’ is about to die and the Google-Facebook duopoly doesn’t seem to like this very much.

But what does it mean? How did it happen and why is it so bad?

It is important to clarify that this type of duopolies has already led the market by making use of their advanced technologies, i. e., this can be seen in different industries. However, when it comes to online advertising, it is very clear that Facebook and Google are the market leaders.

However, sometimes these leaders may not know the limits since in April, June and July 2021, several organizations had Google and Facebook in their sights, the European Union being one of them.

The European Union decided to launch an in-depth investigation against Google on suspicion of possible monopolistic practices in relation to its online advertising business. “It collects data to use for advertising purposes, sells ad space and acts as an intermediary in online advertising. So Google is present at almost every level of the supply chain for the display of Internet ads,” said Community Vice President and Head of Competition, Margrethe Vestager.

Noting the fine of 4,340 million Euros that Google received in 2018 from the EU for “imposing illegal restrictions on manufacturers of Android devices to cement its position”. Also, the French state imposed a penalty of 2.20 million Euros on Google for carrying out practices that prevented websites and applications from selling their advertising space to other advertising companies.

Thus, it is no longer a secret that the formula of Google and Facebook to increase their profits by billions year after year is to exercise a duopoly within the market.

Also, the United States Department of Justice and 35 states filed an antitrust lawsuit on June 2021 against the technology company Google, belonging to Alphabet Inc., for allegedly violating the law by using its power in the market to defend itself from its rivals.

In this way, Google is earning several complaints from different governments in different countries for violating user laws. As for Facebook, Meta reported that more and more users have stopped using the platform. For example, in January 2022, Meta fell around 26% on the US stock market and lost $233 billion of market capitalization. This loss was due to the fact that at the end of 2021 and the beginning of 2022, Facebook lost half a million users.

In the future of the web, Web3 will give users a special place by allowing them to surf the net without having to monetize their personal data.

please check my previous article on web3 here

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