The way that web based advertising works is that the price that advertisers
pay for an individual ad depends on what is known about the person who will
receive it. Advertisers can select their ads to be seen only by people who fit
profiles that they specify. These advertising "slots" are then auctioned off to
the highest bidder in real time.
If there is no tracking data on a
viewer, then they typically get fed what are called "remnant ads". These are low
priced ads for things like fad diets that don't bring in much revenue, but they
fill otherwise vacant space. Web sites that depend on advertising want to sell
as many high priced ads as possible, and minimize the proportion of "remnant
ads". To do that, they need tracking.
Moving to an advertising model
that doesn't use tracking would mean a complete restructuring of the advertising
industry. Old style print newspaper and magazine advertising typically relied on
having a subscriber list to provide equivalent "tracking" data. Publishers would
find out all sorts of information about their subscribers based on things such
as their postal codes. For example, they would get the property tax assessment
values, census data, etc., and use that to form income, age, and family size
profiles of their customers which they would use to base the cost of their ad
slots when dealing with advertisers. All of this data would be audited by third
parties to prevent publishers from creating bogus "demographics".
Web
media doesn't usually have "subscribers", because you don't get web pages
"delivered" to you by the publisher. Instead, you go out and "pick it up"
anonymously yourself (much like old style news stand sales). Without cookie
tracking, then all publishers have to show advertisers is geo-location data. The
price they can charge is much lower.
Television and radio ads have a
similar problem of not really knowing who their audience is. But television and
radio used to have the advantage of limited competition, since there were only a
limited number of frequencies available, and because the high cost of
transmitters also created barriers to market entry. The proliferation of cable
and satellite (and now Internet) distribution though has removed those barriers,
and now television and radio are going broke.
Without cookie tracking,
I suspect what will happen is that popular web sites will either erect
pay-walls, or they will require free registration. Each web site will then find
ways of collecting information about their viewers in the same way that print
media did. Big media conglomerates will be able to aggregate more information
about their viewers, which in turn will tend to drive ownership of big sites
into fewer and fewer hands. In the end, I suspect that the result of more
"cookie privacy" will be far more invasive tracking in far less transparent
ways.
Having said that, I browse with cookies turned off. After all, I
don't need perfect anonymity. I just need to be more anonymous than the average
person so that advertisers don't bother with me.
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