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Comment by CPLX | Hacker News Reader

> it is irrelevant of whether publisher earns 75% or 30% of the total revenue

Of course it matters if a middleman is skimming off 70% of the revenue in a given market.

> it is incredibly efficient

On what planet is a loss of 70% of the resources to the matching process between buyers and sellers "incredibly efficient"?

> What matters is how much they are earning compared to the next best alternative.

Right, which is why it is illegal to prevent there from being a next best alternative via anti-competitive practices which is precisely was was proven in this trial after a detailed examination of the evidence.

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> On what planet is a loss of 70% of the resources to the matching process between buyers and sellers "incredibly efficient"?

One where the market maker is taking up the cost of providing a market. E.g. Steam takes a 30% cut for providing the infrastructure required to distribute games. Some people/companies can do it for less but it is the best option for a majority of sellers.

If the market maker did not the seller would get more revenue but would also eat the cost directly instead of paying someone else to do it.

Are you saying that serving ads costs more than running a news site?

This also neglects the fact that the programmatic market routes billions of dollars intended to be spent on real media (ad placements on real news websites etc), to fraudulent mobile apps and websites and bot traffic.

> Are you saying that serving ads costs more than running a news site?

Static text is much cheaper than dynamic content. News isn't anything that couldn't be served out of a .txt or sqlite CMS.

News providers seem wholly uninterested in providing anything better and actually competing with better content providers

Assuming the content is $0

> Are you saying that serving ads costs more than running a news site?

Serving the ads is probably much more expensive than serving the news site, since there is a ton of heavy algorithms to determine what ads to show.

Total costs for each depends on how much it costed to make the news article so is hard to say.

30% is a long way away from 70% and Steam are providing substantially more of a service for that cut.

> One where the market maker is taking up the cost of providing a market

Does a landlord on a literal physical market take 30% of revenue? I find that unlikely.

How did we arrive here, where supposedly ‘efficient’ digital marketplace is a form of rent higher than actually building physical rent, and expenses on wages and materials for a typical business?

Unfortunately a lot of economic activity in general today is just money-on-money financialism. It is all just gambling and rent seeking and dishonesty. These practices are whitewashed and given various names. The one for rent-seeking is "market making".

Ad platforms too are fundamentally about letting someone perceive ROI lesser than their real ROI, for your own benefit. For me, it falls under the same category as all of the above - zero productivity endeavours.

Maybe we should go back to the previous millenium and make usury illegal. Should fix all of these problems, albeit in a nuclear fashion.

Competing ad/fill markets fix the problem.

Which is why market makers like Google quietly work very hard to discourage, prevent, interfere or buy their competition.

It is 'incredibly efficient' because it is incredibly good at predicting clicks, conversions, or even conversion values. Which in turn makes it efficient. Sure, there is something called "auction" there, but Sothesby's or Tattersalls generally don't have buyers bidding based on what some machine-learning prediction AI computed in a jiffy (or maybe they do these days, who knows).

There are three parties. Media Buyers, publishers and users. As a publisher, you can go with “dumb” platforms that don’t deliver quality users to media buyers because of relevancy, you’ll make less money m. Apple ad platform is 40/60 split but for media buyers, it’s not efficient so we spend less money on it. Assume publishers make less money with it as well.

We seen dumb platforms with linear tv. Go watch any TV with an antenna.

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