Ad tech has the power to democratize the open internet

It’s a fair assumption that most people reading this are interested in ad tech. But for many people outside the industry, the nuances of how ads find their way to their streaming platforms, podcasts and websites are hardly a consideration. Maybe viewers watching a show on Hulu or Peacock have noticed that the ads they’re being served are perhaps a little different, more engaging and more relevant to them. But so what? Why does this matter?

Let me break it down. Ad tech innovation is fundamental to the way the open internet works. It has the power to level the playing field for everyone and — if it’s executed well — promises to make the internet a more accessible, more vibrant place for all users. When I talk about the open internet, that means connected TV and podcasts as well as websites. But it also incorporates apps — for e-commerce, ride hailing or food delivery — whose utility can be monetized by advertising. It’s all connected. Ad tech is making it possible for more people than ever to access media, subsidized or entirely free thanks to ads. And yes, in the open internet’s ideal state, those ads will be more relevant and more engaging. That’s what we mean by the “quid pro quo of the internet.” So yes, ad tech does and should matter to everyone.

Technology has always had the power to democratize experiences for the general population. It follows a familiar pattern: Starting out exclusive and expensive, the technology in question finds efficiencies of scale over time. Think about the automobile — which in 1900 was a vehicle only the wealthy could afford to buy. But then along came the Ford Model T in 1908. Henry Ford wanted the Model T to be affordable, simple to operate and durable. By the time the car went out of production in 1927, more than 15 million had been built and sold. That’s the trajectory.

On a more personal note, when I arrived in the United States in December 1999, I would try to call my family back in India. Typically, this meant buying a phone card to pay for the high cost of an international call, which back then was $5 a minute. Very often, I’d have to choose whether to buy a phone card or forgo the call and buy something to eat. Cut to the present day — we can now make a video call at no cost on FaceTime or WhatsApp. What a difference two decades have made.

That’s what I mean about technology democratizing our lives. Technology for the people.

You can see this dynamic at work in ad tech. A case in point is the surge in streaming platforms all offering premium content. Since Netflix launched House of Cards in 2013 — the first original production it commissioned — streaming content has boomed. And so have the platforms — from Disney+ to Peacock to Max. But multiple subscriptions really add up, can lead to churn and to potentially lost revenue. Inevitably, all these services now have embraced an ad-supported tier to offer different price points and to welcome in more viewers.

In short, ad tech can return power to consumers to choose how they want to pay for the shows they love. And the good news is that no single entity controls this. Thanks to connected TV, the open internet is a space that’s growing richer by the day, beyond the control of a few Big Tech players that have created walled gardens that inhibit the very openness that could make the internet an even better place for all.

And it’s not just about helping fund the shows we love. The opportunity of the open internet means empowering users through useful apps. There are plenty of examples right on our smartphones, some of which can have a positive socioeconomic impact. Consider one of Southeast Asia’s biggest tech firm, GoTo, which offers ride-hailing, e-commerce and financial services via its “super app.” A recent study found that GoTo’s ad tech platform created job opportunities while reducing poverty and income inequality, driving approximately 2% of Indonesia’s $1 trillion GDP in 2022.

Of course, there are those who may be skeptical about the virtues of personalized or targeted ads. To be sure, after events like the Cambridge Analytica scandal where the data of millions of Facebook users was misused, there was an inevitable public backlash about this breach of privacy. But to my mind, data is like electricity. It’s not inherently bad or good. It just needs to be regulated. In the United States right now, and in Europe, there’s a push to protect personal privacy that’s entirely appropriate.

At the same time, millions of viewers across ad-funded streaming platforms can enjoy their favorite shows and movies thanks to the evolution of ad tech. Connected TV viewers are often an opted-in, authenticated audience, which means that they can receive ads that are relevant to them, potentially more engaging to them and thus more valuable. That’s the quid pro quo of the internet at work.

Advertisers are forging new, privacy-conscious strategies to reach the right audience for their products with interoperable identity solutions like ID5, RampID or Unified ID 2.0, which are already proving their worth to advertisers. Meanwhile, publishers — in their efforts to better know their readers, users, consumers — are looking at products like OpenPass to enable a more transparent way of keeping their properties valuable. Their value is linked to knowing the people who visit their sites. Everyone has a vested interest in understanding this relationship among consumer, publisher and advertiser.

Such innovations are helping the ad tech ecosystem grow in a healthier way. And then there are proposed solutions like Google Chrome’s Privacy Sandbox. If recent reports are any indication, it is already falling short. In February, the IAB Tech Lab released an in-depth analysis of the Privacy Sandbox, saying it “may limit the industry’s ability to deliver relevant, effective advertising, placing smaller media companies and brands at a significant competitive disadvantage. The stringent requirements could throttle their ability to compete, ultimately impacting the industry’s growth.”

The truth is, if ad tech is to democratize the internet, it needs to be truly open. We cannot be beholden to a handful of Big Tech companies or their opaque operating systems that stymie the collective effort. We live in a world of fragmentation, but openness, objectivity and transparency across the ad tech ecosystem is a sine qua non for this industry.

That’s how we move forward together.

The Current is owned and operated by The Trade Desk, Inc.