Online Advertising is a Regrettable Necessity: On the Dangers of Pay-Walling the Web
For policymakers and web stakeholders, this highlights the societal risks of moving away from ad-supported open web models.
The paper argues that paywalling the web is unsustainable and exacerbates digital divide, showing that 135 countries (6.56 billion people) cannot afford a fully paywalled web based on GNI per capita and paywall costs.
The exponential growth of the web and its benefits can be attributed largely to its open model where anyone with internet connection can access information on the web for free. This has created unprecedented opportunities for various members of society including the most vulnerable, as recognized by organizations such as the UN. This again can be attributed to online advertising, which has been the main financier to the open web. However, recent trends of paywalling information and services on the web are creating imminent dangers to such open model of the web, inhibiting access for the economically vulnerable, and eventually creating digital segregation. In this paper, we argue that this emerging model lacks sustainability, exacerbates digital divide, and might lead to collapse of online advertising. We revisit the ad-supported open web business model and demonstrate how global users actually pay for the ads they see. Using data on GNI (gross national income) per capita and average paywall access costs, we established a simple income-paywall expenditure gap baseline. With this baseline we show that 135 countries with a total population estimate of 6.56 billion people cannot afford a scenario of a fully paywalled web. We further discuss how a mixed model of the so-called "premium services" creates digital segregation and poses danger to online advertising ecosystem. Finally, we call for further research and policy initiatives to keep the web open and more inclusive with a sustainable business model.