Advertising in the age of the internet

The Internet has spawned more innovation over the last 20 years than we’ve seen as a society in the past century. It has become a powerful economic equalizer, allowing us to participate in global commerce instantly and with people all around the planet.

But more than the incredible economic engine it powers, the Internet is the connective tissue that lets us create and share content that brings us closer together. Consider these facts: 140 characters tweeted from one country can spark a conversation halfway around the world; consumers can browse and purchase almost anything from the comfort of their own home; and a simple post from an independent blog can make headlines in The New York Times.

Today, we carry a world of information in our pockets everywhere we go. As remarkable as that is, we’ve become so accustomed to our unrestricted access to online content that it’s easy to forget what pays for it. And as consumers spend more time on the Internet, there’s little question that digital advertising – which topped US$ 100 billion worldwide last year and now represents roughly US$ 1 out of every US$ 5 ad dollars spent – has emerged as the lifeblood of our digital economy.

This value exchange isn’t a new concept. TV, radio, print and other traditional media have been able to fund the content they create while keeping consumer costs to a minimum (if they pay anything at all) thanks to advertising. And when it’s done right, with a high quality, contextually relevant ad experience, the value trade is a powerful one from which everyone benefits.

What’s different about the Internet is the volume and diversity of content available. From its beginning, the Internet has been a democratic and fertile ground where anyone can produce original content and share it with the world, from a college student in a dorm room to a major news organization with global reach. Both compete for the same attention from consumers, so to keep digital content available (and “free”) for Internet users, publishers need to be able to monetize their work by giving advertisers the opportunity to reach the right consumers.

That’s where companies like Rocket Fuel, which makes digital advertising more relevant to consumers and effective for advertisers; Integral Ad Science, which helps protect the online ad environment; and my own, AppNexus, which works to put more money into the digital system by making it easier for content producers and advertisers to connect with consumers, come in.

Every day, our technology platform facilitates tens of billions of ad transactions, putting hundreds of millions of ad dollars in the hands of online and mobile content producers who use that funding to create more content for the consumer.  It’s a virtuous cycle. The better we are at putting together consumers, publishers and advertisers, the more effective and accessible the Internet will be in the future.

New York City, where  companies like Tumblr, MongoDB, and AppNexus are based, has long been recognized as the media and advertising capital of the world. Now the city has come into its own as one of the great technology hubs as well. At AppNexus, we’re bringing these three communities together to create a better Internet through better advertising because a better Internet means a better world.

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Author: Brian O’Kelley is Chief Executive Officer and Co-Founder of AppNexus, a World Economic Forum Technology Pioneer company.

Image: Internet cables are seen in Sydney REUTERS/Tim Wimborne.