Ending the privacy bidding war is a frontier for new investment


Meta Platforms’ core product is not Facebook…nor is Alphabet’s product Gmail, or Twitter’s product has nauseating levels of vitriol.

For all these companies, the main product is you.

And to get the most money when they sell you to advertisers, pollsters and Snowden-knows-who-else…they have to invade your privacy.

Hackers, scammers and phishers do this using underhanded and unethical methods. But social media sites and other web publishers don’t need to. They invade your privacy by taking the information you voluntarily provide to them in exchange for their services… and selling it to marketers.

If that worries you, it should. And you’re not alone… According to Google Trends, more people than ever are searching for the phrase, “If the product is free, you are the product.”

Americans want their privacy back. This is a problem that must be solved. Today I’m going to explain what this means for investors – but first, let’s look at how we got here…

In the 1990s, the dot-com boom was a time of outrageous profits for lucky (smart?) investors. I was one of them.

My best investment was the one-word domain name (a URL you type into your browser to access a webpage) that I bought for $7. I sold it six years later at the height of dot-com mania for over a million dollars.

The buyer paid so much simply because he thought a lot of people would type in that domain name – and all those “eyeballs” were worth paying for. (They were right.)

That was 1999. Until then, many internet companies got by without revenue because they could simply burn through investors’ capital. But after the dot-coms wound down in the early 2000s, they had far less investment capital to spend.

Thus, Internet companies have turned to advertising. But the advertising models of newspapers and television did not work at all on the Internet…

For example, Internet users in the 90s did not tolerate large, full-page display ads. And the bandwidth at the time did not allow streaming video as TV commercials demanded.

At the time, I had a job helping small internet businesses advertise. After the bust, we shifted our focus away from just “shooting,” as it was called, and into strategies that worked.

The race was on to monetize every inch of the internet in a way early publishers couldn’t. A new tactic has evolved – pay per click (or “PPC”).

PPC is a way to measure the effectiveness of advertisements. Internet advertisers pay Google or Microsoft Bing or Meta or Twitter anywhere between a penny and $109 each time you click on an ad. Whoever wins this bidding war is the one whose ad appears on your screen. Suddenly, every click on every ad became the penalty Something.

This model reduces costs for advertisers. It captures your interest by giving you content you want to click on. And it’s a proven tactic to increase revenue for the advertiser, their publisher, and the medium that sold them the ad space to begin with.

But it’s also a blatant invasion of your privacy. Now everything we watch, watch, read, or interact with is monetized by the publisher who created it… And as web browsers have gotten better at tracking your behavior, that monetization can target almost anything about you .

Therefore, “you are the product”.

The idea behind this phrase originated in the 1970s as a warning against what was considered the over-commercialization of television…

But it is even more true today. The things we consume on the internet are only free because ad revenue (like text ads, search results, or video ads) supports free content publishers.

If you use Google Trends to index how often people search for that phrase, you see that it gained as much popularity in the 10 years from 2009 to 2019 as it did in the Three years from 2019 to today…

It’s not just Google Trends either…

Market information firm Morning Consult surveyed 1,992 registered U.S. voters in 2021 and found that “86% of Democrats and 81% of Republicans said Congress should make privacy a ‘top’ or ‘ important but lower” in 2021″.

That’s at least four out of five people in both sides on the same side of a question. We cannot think of any other issue favoring this kind of bipartisan agreement.

There is an unprecedented level of agreement from the bluest of Democrats to the reddest of Republicans…saying Something must be done about privacy.

We are online more than ever. And with the coming wave of the Internet of Things, we will be more connected to the Internet than ever before.

Internet advertising revenue in the United States surpassed television advertising in 2017, according to Statista… And globally, the industry is now worth $365 billion. So far the advertisers have won.

But there is a demand for a web experience where you don’t have to sacrifice your privacy to go online. Both sides of the aisle support it. And figuring out how to solve this problem will mean disrupting an industry worth hundreds of billions of dollars.

This will be a huge opportunity for innovative companies looking to create the Internet of the future. We’ll soon see newcomers determined to end the privacy bidding war… And that will be a major frontier for investment in the years to come.

Good investment,

Eric Wade

Editor’s note: One of Eric’s subscribers came to him last year with an anonymous letter. Now we finally share the whole story behind it. It has to do with the Stansberry Research strategy that has created more huge winners than any other in our company’s history…including over 60 opportunities since the start of 2020 that could have earned you between 100% and 5,000% winnings. Get the details here.


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