"Ad networks would install their boxes in datacenters and hosting providers' networks. Ads would cost a little more." You're vastly over-simplifying the techno

"Ad networks would install their boxes in datacenters and hosting providers' networks. Ads would cost a little more." You're vastly over-simplifying the technological problems involved with site-serving ads. The bids don't come from "ad networks" - I also assume you mean ad exchanges not ad networks? - they come from a federated collections of bidders (generally called DSPs or other custom bidders, which there are hundreds or thousands of). They also rely on extensive client-side cookie matching in order to determine who the user is and how valuable they are. Not only that, but then the ad itself lives on a different server from the one doing the bidding, and is often generated dynamically based on that specific user as well. You can't just dump these either; real-time bids from many sources, user-based advertising, and dynamic advertising, are some of the key contributors to the continuously increasing value of remnant ad placements over the last 5-10 years.