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Center for Education and Research in Information Assurance and Security

Ad-Blockers: Extortionists or Digital Age Robin Hoods?

Abhishek Ray

Nov 15, 2017

Abstract

Intrusive online advertising has given birth to the trend of ad-blockers. Initially dismissed by the online advertising industry as inconsequential, ad-blockers have evolved from a mere plugin tool on browsers to full-fledged platforms that derive benefits from certifying quality of advertisers and reducing disutility of users from intrusive activities such as user tracking. 
However, are ad-blocking platforms the optimal solution to improving user experience online? There is no clear answer. User experience advocates term this as yet another way to target users online. Industry advocates accuse ad-blockers of using an extortion-based business model, built on fleecing advertisers. Through our game theoretic model, we inform policy-makers on this problem and establish the optimal pricing policy for such ad-blocking platforms. In addition, we theorize the socially optimal pricing policies of advertising supported content platforms and establish how such platforms should price participation from users, given the obvious disutility of advertising they are exposed to.

About the Speaker

Abhishek Ray is a 4th year PhD candidate in Management Information Systems at Krannert School of Management, Purdue University. His research interests lie at the intersection of Economics, Digital Business & Engineering. He holds an MS in Economics and MS in Industrial Engineering from Purdue University.

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