III. The Internet sells its soul

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WHEN times are tough, commercial re­alities bite hard. Internet users are increasingly being asked to pay for in­formation, music and other services. Ad­vertisers, too, have grown more demand­ing. As a result, the Internet is being transformed, from a vast repository of mostly free content into a commercial cauldron in which almost everything is available only at a price.

Even Internet search-terms are up for sale, as advertisers bid to push their sites up to the top of search-engine listings. As if to confirm the trend, Yahoo! has just announced that its revised privacy rules will allow it to exploit users' personal informa­tion to market its own and business part­ners' products and services-unless users take the trouble to opt out by ticking a long list of preferences.

In retrospect, more aggressive commer­cialisation of the Internet was inevitable. As the many dotcoms that have already gone bust discovered, making money on the web is not easy-especially from ad­vertising. Yahoo! might be a giant Internet portal with more than 23om users, but it is now desperately trying to reduce its reli­ance on ad revenues by providing new paid-for services and content. Last week, the firm posted its sixth consecutive quar­terly loss. If its users do not go to a special site in the next 60 days to change their pref­erences, they are likely to be barraged by e-mail, telephone calls and other direct-mar­keting material.

Yahoo! says that its sales pitches will be restrained. It plans only to e-mail and call target groups of users on advertisers' be­half. But other portals have already gone further and are renting their customer lists directly to advertisers.

This has resulted in a new flood of intrusive advertising, which is beginning to irritate many users. A new business is growing up to provide software that blocks Internet ads. A program called Smasher, for instance, claims to stop pop-up ads and to remove from pcs the "cookies" (in effect, electronic name-tags) that advertisers and websites plant on to a user's machine to monitor the use of their ads.

If the Internet has a soul, it is the vast pool of information that people can ex­plore, usually using a free search-engine. Now, even search-engines have become vehicles for marketing products and gath­ering information on users. Somebody us­ing the term "digital cameras", for instance, is probably interested in photography and may be on a shopping expedition. Many search-engine sites are now auctioning such search-terms. The more companies are prepared to pay, the higher their web-sites will appear in the results.

The pioneer of paid listings is Overture, a California firm that has built a profitable business from a string of partnerships with sites such as AltaVista, aol and Ya­hoo! Advertisers are now paying around 60 cents for every user clicking on their link, so as to get towards the top of the list­ing for digital cameras. The idea behind such paid listings is spreading fast. Over­ture, however, is now suing Google, one of the Internet's most popular search-en­gines, alleging that Google's own recently launched system for auctioning keywords infringes an Overture patent. Google de-nies this.

Although the Internet's growing com­mercialisation is unlikely to slow down any time soon, it is still far from clear what the best business models should be. On the face of it, aggressive, in-your-face ad­vertising seems to work. Advertisers say that their "click-through" rates—the per­centage of visitors to a website who click on an ad-is greatly increased by the use of pop-up ads rather than stationary "ban­ner" ads. But many people may be clicking accidentally as they struggle to get rid of such ads. Some sites have become virtu­ally unviewable because of the mass of ad­vertising directed at anyone who visits.

If users do not want to be hounded by advertising, they may have to consider something that most have so far been loth to do: paying subscriptions for their fa­vourite sites, just as they do for newspa­pers, magazines or cable-TV channels. Al­ready, companies are charging for e-mail services that were once free. The Internet may be a mould-breaking new medium but, as with all that came before it, some­body has to pay-and that usually means, one way or another, users.

Дата добавления: 2015-11-14