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If you're a US citizen with a Facebook account, your value for Facebook is about $ 200 per year. That's the average, including children, seniors, etc. If you're

If you're a US citizen with a Facebook account, your value for Facebook is about $ 200 per year. That's the average, including children, seniors, etc. If you're a tech worker in your 30s, it's probably 3x as much. If you want to use Facebook without targeted advertising, you need to either convince them that they don't need all that money, or pay it yourself. And that's just Facebook. In other words: the internet economy without targeted ads will be a very different place. Facebook will survive. imgurl / snopes / fivethirtyeight? Unlikely...

UweSchmidt 6y ago
Worth noting that the $200 ultimately come from our pockets. We are paying those $200 anyway through markups on products ads made us buy.
- lordnacho 6y ago
  Isn't the 200 bucks more a way for FB sellers to get your money instead of other shops?
  - names_are_hard 6y ago
    No, because it's $200 on top of what you would otherwise spend on the stuff you buy. The cost of marketing has to get baked into the price of goods or the sellers would be losing money. If they weren't advertising, or could advertise for less, they'd be able to lower prices.
    - tangjurine 6y ago
      Advertising can lower the cost per item, if there was a large startup cost and marginal costs are small. More importantly, facebook ads have caused me to buy more things because the ads showed me things that I thought were useful that I otherwise wouldn't have known about. Honestly, I feel like maybe I should be paying to see FBs ads sometimes.
- rorykoehler 6y ago
  I would love to see a correlation score between profiles and purchases
- names_are_hard 6y ago
  Not necessarily. I don't know what percentage of advertising revenue is from political advertising, but that's money that Facebook makes off of you that doesn't come out of your pocket. Essentially any time you're shown an ad that aims to convince you to support some idea, or vote for something, or change your behavior in some way (like going vegan) instead of trying to get you go spend money, you provide value to Facebook that doesn't come out of your pocket. I suspect that this is a lot of the value of "the next billion". Why bring Facebook to people who have little disposable income? Because there are still ad buyers who will pay to reach those audiences if they have votes to give, or even just public support for some cause or another.
  - scatters 6y ago
    Money spent on political advertising absolutely comes out of your pocket. The process is: politicians levy taxes and excise, divert the revenue to linked entities, pay Facebook out of the proceeds. Or they extract money from companies under threat of expropriation via adverse regulation and litigation. In developing countries this is blatant; in developed countries it is disguised (as lobbying, consulting fees etc.). In fairness, there is an argument that at least some political advertising is consumption by politically engaged citizenry who don't stand to gain financially from the result; witness spending on unwinnable Senate races in the latest election, for example. But in general you have to assume that political advertising comes with some expectation of return, which comes out of the everyday citizen's pocket.
    - names_are_hard 6y ago
      Let me rephrase. Someone advertises to you because they expect something in return. Coca-Cola advertises to you because they expect you to buy coke. If you're too poor to buy coke, you're not useful to them. Joe's political campaign advertises to you because they want you to hate Bob, or be scared of those other guys, or whatever. This will help put Joe in charge, which is good for Joe and potentially bad for you, but it doesn't necessarily come out of your pocket. It comes out of the pockets of Joe and his friends. That might be taxpayer money, but you might not be the taxpayer paying for it. It might be private money from religious people who want gay marriage to be illegal. You pay for it with freedom, but not with money. My point wasn't that there's a free lunch here. My point was that there are other mechanisms at play, costs of advertising that don't translate directly into cost of goods and services you buy.
- monkeybutton 6y ago
  Potentially buy.
- imtringued 6y ago
  Product awareness is not the same thing as buying something.
tonyedgecombe 6y ago
>If you're a tech worker in your 30s, it's probably 3x as much. I wouldn't be surprised if it's much more than that. Most businesses sales follow the Pareto principle, 80% of their revenue comes from 20% of their customers.
pjc50 6y ago
"Without ads" and "without targeted ads" are different things. There's an "ad-centrist" view whereby adverts should be OK so long as they're chosen to go with the content on the page and the community that the site aims at - you know, like all newspapers and magazines used to do. I'm not sure how imgurl survives given the abuse workload; there is an inevitable death spiral of image hosting sites as they get cluttered by more and more adverts of worse and worse quality. Stackexchange handles this very differently, too.
pradn 6y ago
And what about all the sales that are made through Facebook ads? They support millions of jobs around the world. A less efficient ad machine would mean worse sales or higher marketing costs or both. Some of this excess goes directly to profits, but a good chunk of it supports employment. Imagine if we got rid of all advertising and what that would do to demand. I know the discussion here is centered on targeted ads, but I think there would be significant economic effects if their incidence was decreased. The global consumer economy runs on all these extra desires created by ads, and ads do fulfil the function of informing customers. If I have to see ads (and I really don't), I'm not against tracking ads per se, but the long-term storage of them. Given current technology and governance, there's not a way to separate these two. In any case, there's significant economic effects to stopping tracking ads.
bogwog 6y ago
> If you want to use Facebook without targeted advertising, you need to either convince them that they don't need all that money, or pay it yourself. And that's just Facebook. I hate this argument. It's tries to find a solution to sustain the status quo in the face of change. But that's illogical because if there is a change, then the status quo is going to change too. The only way Facebook is going to stop doing targeted advertising is if they're forced to, likely due to new regulations. If that happens, Facebook's entire business model will collapse, so they'll either have to make massive fundamental changes to how they make money, or they'll die and be taken over by a competitor. In either case, users don't "owe" Facebook anything. Consumers are the life blood of the economy, and thinking about how consumers should change their behaviors to sustain a corporation is backwards thinking.
- s1artibartfast 6y ago
  I think you might be missing the main point of the argument. It is not that users owe or need to sustain facebook. It is that most users may prefer keeping FB and targeted adds, over losing FB and taking down targeted adds.

UweSchmidt 6y ago

Worth noting that the $200 ultimately come from our pockets. We are paying those $200 anyway through markups on products ads made us buy.

lordnacho 6y ago
Isn't the 200 bucks more a way for FB sellers to get your money instead of other shops?
- names_are_hard 6y ago
  No, because it's $200 on top of what you would otherwise spend on the stuff you buy. The cost of marketing has to get baked into the price of goods or the sellers would be losing money. If they weren't advertising, or could advertise for less, they'd be able to lower prices.
  - tangjurine 6y ago
    Advertising can lower the cost per item, if there was a large startup cost and marginal costs are small. More importantly, facebook ads have caused me to buy more things because the ads showed me things that I thought were useful that I otherwise wouldn't have known about. Honestly, I feel like maybe I should be paying to see FBs ads sometimes.
rorykoehler 6y ago
I would love to see a correlation score between profiles and purchases
names_are_hard 6y ago
Not necessarily. I don't know what percentage of advertising revenue is from political advertising, but that's money that Facebook makes off of you that doesn't come out of your pocket. Essentially any time you're shown an ad that aims to convince you to support some idea, or vote for something, or change your behavior in some way (like going vegan) instead of trying to get you go spend money, you provide value to Facebook that doesn't come out of your pocket. I suspect that this is a lot of the value of "the next billion". Why bring Facebook to people who have little disposable income? Because there are still ad buyers who will pay to reach those audiences if they have votes to give, or even just public support for some cause or another.
- scatters 6y ago
  Money spent on political advertising absolutely comes out of your pocket. The process is: politicians levy taxes and excise, divert the revenue to linked entities, pay Facebook out of the proceeds. Or they extract money from companies under threat of expropriation via adverse regulation and litigation. In developing countries this is blatant; in developed countries it is disguised (as lobbying, consulting fees etc.). In fairness, there is an argument that at least some political advertising is consumption by politically engaged citizenry who don't stand to gain financially from the result; witness spending on unwinnable Senate races in the latest election, for example. But in general you have to assume that political advertising comes with some expectation of return, which comes out of the everyday citizen's pocket.
  - names_are_hard 6y ago
    Let me rephrase. Someone advertises to you because they expect something in return. Coca-Cola advertises to you because they expect you to buy coke. If you're too poor to buy coke, you're not useful to them. Joe's political campaign advertises to you because they want you to hate Bob, or be scared of those other guys, or whatever. This will help put Joe in charge, which is good for Joe and potentially bad for you, but it doesn't necessarily come out of your pocket. It comes out of the pockets of Joe and his friends. That might be taxpayer money, but you might not be the taxpayer paying for it. It might be private money from religious people who want gay marriage to be illegal. You pay for it with freedom, but not with money. My point wasn't that there's a free lunch here. My point was that there are other mechanisms at play, costs of advertising that don't translate directly into cost of goods and services you buy.
monkeybutton 6y ago
Potentially buy.
imtringued 6y ago
Product awareness is not the same thing as buying something.

tonyedgecombe 6y ago

>If you're a tech worker in your 30s, it's probably 3x as much. I wouldn't be surprised if it's much more than that. Most businesses sales follow the Pareto principle, 80% of their revenue comes from 20% of their customers.

pjc50 6y ago

"Without ads" and "without targeted ads" are different things. There's an "ad-centrist" view whereby adverts should be OK so long as they're chosen to go with the content on the page and the community that the site aims at - you know, like all newspapers and magazines used to do. I'm not sure how imgurl survives given the abuse workload; there is an inevitable death spiral of image hosting sites as they get cluttered by more and more adverts of worse and worse quality. Stackexchange handles this very differently, too.

pradn 6y ago

And what about all the sales that are made through Facebook ads? They support millions of jobs around the world. A less efficient ad machine would mean worse sales or higher marketing costs or both. Some of this excess goes directly to profits, but a good chunk of it supports employment. Imagine if we got rid of all advertising and what that would do to demand. I know the discussion here is centered on targeted ads, but I think there would be significant economic effects if their incidence was decreased. The global consumer economy runs on all these extra desires created by ads, and ads do fulfil the function of informing customers. If I have to see ads (and I really don't), I'm not against tracking ads per se, but the long-term storage of them. Given current technology and governance, there's not a way to separate these two. In any case, there's significant economic effects to stopping tracking ads.

bogwog 6y ago

> If you want to use Facebook without targeted advertising, you need to either convince them that they don't need all that money, or pay it yourself. And that's just Facebook. I hate this argument. It's tries to find a solution to sustain the status quo in the face of change. But that's illogical because if there is a change, then the status quo is going to change too. The only way Facebook is going to stop doing targeted advertising is if they're forced to, likely due to new regulations. If that happens, Facebook's entire business model will collapse, so they'll either have to make massive fundamental changes to how they make money, or they'll die and be taken over by a competitor. In either case, users don't "owe" Facebook anything. Consumers are the life blood of the economy, and thinking about how consumers should change their behaviors to sustain a corporation is backwards thinking.

s1artibartfast 6y ago
I think you might be missing the main point of the argument. It is not that users owe or need to sustain facebook. It is that most users may prefer keeping FB and targeted adds, over losing FB and taking down targeted adds.