18 Things, #18: The walled gardens win

The web is now well in to its twenties. When it was born it was open, free, and collaborative. The last two decades have been a process of closing and commercialising, the building of walled gardens. While there’s a nostalgic drive to “save the web”, the walled gardens have won. In 2018 we’ll likely see Google and Facebook capture more than 100% of digital advertising growth globally, and Facebook representing more than a quarter of time spent online by Australians(currently sitting at 21%).

In 1996 John Perry Barlow wrote his Declaration of the Independence of Cyberspace, warning corporations and governments that “You are not welcome among us. You have no sovereignty where we gather”. Skip forward 21 years and we are on the verge of the end of Net Neutrality, a clear signpost for the end of the period of massive innovation on an open web.

Walled gardens winning means many things. For publishers and media companies it means that their digital advertising revenue will decline, while they simultaneously face competition as publishers and content creators from Google, Facebook, and Amazon. For brands it means an even more challenging environment for connecting with existing and new customers, with a decline in control and visibility as you are forced to play on the walled garden’s terms.

New innovation is needed, and it will happen eventually. And while the trendlines all seem to point in one direction, I expect 2018 to be the last year of growth in developed markets for these “traditional” digital companies (but more on that in 12 months).

Confidence: 100%

18 Things is a slightly different take on the usual “Annual Predictions” posts. For the next 18 days I’ll post one thing per day I believe might happen in 2018, with a brief overview of why. Each will also have a confidence level (an idea nicked from Scott Alexander), so I can come back at the end of the year and see how I went.

I’ve mostly stuck to my circle of competence, but please don’t read in to anything too much, and definitely don’t go betting your house on any of these. You can read previous posts here, or if you’re impatient, I’ll be posting these in 3 parts over at Blonde3.com.