Advertising is big business and as increasing activity moves online, so too do the marketing dollars. While 2015 saw an estimated $170.5 billion (bn) spent on online advertising globally, this figure is projected to mushroom almost 50% by 2018 to $252bn. But can anyone apart from the big guys snap up a slice of this lucrative business and leverage the Internet of Things to achieve it?
Until recently only the big players were able to get into it. Software though has made it possible for some webmasters to serve adverts and generate revenues based on their own traffic. Yet profiting from the advertising sector more broadly was a complex undertaking out of reach to the ordinary punter and investor.
Now to solve the problem, a group of future-tech innovators from Denmark and the US have used the power of ‘peer-to-peer’ platforms to throw the doors open to everyone. Effectively they are offering anyone who wants it a piece of a pie that isn’t getting smaller any time soon.
It follows documentation revealed just last week of the so-called ‘Decentralized Conglomerate’ concept using the Blockchain, which Larry C. Bates, Bitland’s Chief Security Officer from Bloomington, Indiana, was involved and instrumental in.
BitTeaser, an advertising network that combines advanced blockchain technology and a fresh market approach that launched in January 2015, is one venture being touted by its creators as the “evolution of online marketing”. The innovators behind it have high hopes that it will pave the way to the next stage of advertising.
That said, it could well be a bit of a David and Goliath struggle for the new boys on the block versus the likes of Google GOOGL -0.43%’s AdSense, which has been used by almost two million users for blogs and websites. The service is a major income contributor for Google.
Indeed, just go back to earnings from AdSense in Q3 2012 and they amounted to a not inconsiderable $3.13bn, or 27% of Google’s revenue. Fast forward to this January and AdSense earnings for users had declined 50%-70% and AdSense publishers were questioning the massive decrease in their earnings, low RPM and low CPC on many tech forums.
What Is BitTeaser’s USP?
Effectively BitTeaser is described as a “powerful combination” of cutting-edge advert placement and the speed, flexibility and convenience of digital cash. Together, these offer what are being promoted and described as the “democratization of advertising”, and offer anyone with a website to benefit from ad revenues – wherever they are located in the world.
While Google’s AdSense program popularized the idea of site owners hosting adverts, promoting businesses in return for revenues based on clicks from their visitors and represented a great step forward, certain market observers view it as still having a number of shortcomings.
For a start, some point to the limitations of AdSense itself. For instance, there is the minimum payout of $100, which instantly disqualifies small sites from benefiting on a meaningful time scale, not to mention the need to have a bank account to receive payments in the first place – something we take for granted in the West. However, that isn’t the case for around a third of the world’s population today despite the fact that many of them are nevertheless active web users.
One could also cite the entry barrier of applying and submitting documentation for Know Your Client (KYC), low earnings and the restricted range of sites that can host ads.
Digital Money Solution
Using digital money solves or rather circumvents all of these issues according to the developers behind BitTeaser. The combination of serving adverts and paying in Bitcoin (BTC) and other forms of virtual or digital currency is being held up as a natural development. And, why shouldn’t it.
One should be minded to note that BitTeaser is not the first such initiative, but it does have some advantages over earlier forays in the space. Previous efforts were limited in scope or lacked the “flexibility and user friendliness” of BitTeaser according to the developers behind the project.
“This is not a completely new crypto service,” says Ronny Boesing, CEO of Danish crypto currency exchange CCEDK and the entrepreneur who heads up the program with counterparts in the US.
“However, it is the leader in terms of both its reach and the variety of payment options that are offered,” he adds. “Users can pay for ads and accept revenues in just about any digital coin they want.” This includes BTC (Bitcoin), ETH (Ethereum), BTS (BitShares), BitUSD, BitEUR, OBITS, LTC (Litecoin), DOGE (Dogecoin), PPC (Peercoin) and NBT (NuBit) – to name a few options.
Payment Rates & Speeds
The speed of all forms of “crypto-currency” payments, as well as their low cost, accessibility to anyone with an internet connection and relative anonymity, makes BitTeaser “an attractive proposal for webmasters and businesses alike” according the Dane who was educated in the US.
For example, there are a wide variety of banner sizes and configurations, and several advertising models for advertisers. Moreover, the cost benefits can be passed on to hosts – meaning that BitTeaser can boast the highest percentage of revenues paid per click in the sector.
Webmaster receive up to 90% from the cost of a click. So, simply if the click costs 5 US cents, they will receive about 4.5 cents. (Note: The current average price per click being 5.15 cents).
There will also be an option to set a fixed-price per click for the webmaster, which potentially could be interesting for websites with quality traffic. Also, an auction system of traffic distribution is in the pipeline and expected to be presented in due course.
Some like Paytoshi at btcfaucet.smart-bytes.com, a site that allows users to purchase pre-written code to make their own crypto-currency faucet, have chosen to use BitTeaser over Adsense because they had trouble in converting their profits into Bitcoin to reinvest in their site.
They also disclosed that: “The volatility makes it hard to predict the revenues and also it takes too long to convert them. So, if all of this is done for you, why not use the ready-made solution instead of doing it all by yourself?” Point taken.
The idea of a faucet is that a centralized micro-payment page allows new users of a digital token to receive a little bit of currency in their wallet so that is is not standing at zero. Faucets have a set limit that is given to each user every 24 h0urs. Thereby a single person cannot empty a faucet by visiting it repeatedly.
BitTeaser and Open Ledger
The crypto advertising network is one of a growing number of projects associated with OpenLedger, the fintech platform for which CCEDK is registrar and which is used to administrate the associated BitTeaser asset – a token that acts as a kind of crypto stock.
Clearly, although every business has to start from somewhere, the prospects for growth in this area are viewed as being significant. And, it is no good trying to build a global ad network on a blockchain that suffers from fundamental limitations of scalability.
In contrast to and unlike Bitcoin, which is still mired in almost intractable arguments over block size, the Open Ledger platform is built on Bit shares, a protocol that uses MIT University-licensed Grapheme blockchain technology and integrates a governance structure to drastically reduce transfer and trading fees, as well as reach consensus on key decisions.
The Internet of Things
Boesing explains: “It allows targeted ad campaigns based on the ecosystem’s metadata. And, as the ‘Internet of Things’ (IoT) becomes tomorrow’s reality, the smart network has been designed to evolve with the market.” So one could argue that the future of advertising is here.
He contends further that: “By combining advanced blockchain technology and a fresh approach to market trend analysis, BitTeaser will lead the way into the next stage of advertising.” Well, I guess the Dane is hardly likely to be less than bullish in his outlook given his involvement with the BitTeaser project.
Pointing to the Internet of Things as being one of the hottest current trends in tech, Morgan Stanley MS +1.66% projects that within the next five years, as many as 75bn smart connected devices will be communicating with each other via IoT.
And, research firm Gartner IT +0.69% has predicted that IoT will generate almost $2 trillion in global economic value by 2020. Perhaps not surprisingly IoT is placing unprecedented pressure on companies to modernize and migrate their legacy systems to handle growing consumer demand.
The flexibility and purely market-driven approach that such a crypto platform enables is being promoted in a way to users that means there are said to be “few limits” on what can be executed or undertaken.
Having tested the service himself, and being surprised at the low price per click that was possible (the lowest price being 0.0001 BTC/currently c.$0.04), CCDEK’s Boesing reveals that he literally “jumped at the chance” to partner with BitTeaser.
“We have tried a few other crypto-advertising networks in the past,” he reveals. “However, they didn’t match our different requirements. Consequently and following some negotiations we commenced a trial and it grew into a long-term cooperation. There were no doubts in our mind that advertising with BitTeaser would be a profitable business model.”
Going forward from here, new technologies will be integrated into the platform, bringing their own unique advantages. One such development is IOTA, an ‘Internet-of-Things’ currency that takes a radically different approach to regular blockchain technology to deliver fee-free transactions as well as unprecedented scalability – both factors which are said to lend well to BitTeaser’s application.
“For obvious reasons, we’re very interested in using technologies like this. Costless micro-transactions are perfect for this kind of business model,” Boesing asserts.
Traditional online advertising networks do not typically allow for their ordinary users to invest in the overarching company behind ventures. But this is something that is a relatively trivial matter when dealing with crypto currencies.
With reference to BitTeaser, for example, it is possible to purchase a stake in the initiative and even the underlying technical platform, BitShares. In fact it is also something CCEDK’s Boesing has actively pursued as part of “an intentional move towards the sharing economy”.
BitTeaser is powered by a digital token that trades on OpenLedger’s platform under the ticker symbol ‘BTSR’. The power and flexibility of the network’s infrastructure allows users to earn tokens by blogging, selling ads, pointing traffic to a designated website via social media or SEO. And, if they want to be an active community member they can opt for that too.
Tokens can also be purchased on the next-generation digital asset exchange OpenLedger.info, or on the BTSR.IO site, for a wide range of different fiat and virtual currencies including US dollars, Bitcoin, Ethereum and BitShares amongst others.
Holding BTSR entitles owners to a slice of BitTeaser’s revenues. With 70% of monthly profits being used to purchase tokens – holders should always be able to cash out without trouble – while the intention is that remaining tokens will command higher prices in the future.
The ultimate goal is to make people love the service (see educational video) to such an extent that they just want to be a part of it. That means generating revenues from adverts on their sites and benefiting from profits distributed to BTSR holders.
But even if, as Boesing contends, it is the “kind of project that should sell itself”, the program looks like it is hardly selling itself short. And, while one can’t surely fault this initiative any ambitions on taking on players like of Google AdSense won’t exactly be a stroll. Watch this space.