Joined: 19 Dec 2002
|Posted: Tue Jul 30, 2019 12:20 am Post subject: What is the revenue generation model for DuckDuckGo
|What is the revenue generation model for DuckDuckGo?
Gabriel Weinberg, CEO & Founder at DuckDuckGo.com (2008-present)
Updated Jun 14, 2018 · Upvoted by Vikram, former Owner at Business and Pranay Manocha, MBA. Software Developer. Co-founder, RefugeeMaps.org.
DuckDuckGo has been a profitable company since 2014 without storing or sharing any personal information on people using our search engine. As we like to say, what you search on DuckDuckGo is private, even from us! We’re proud to have a business model for a web-based business that’s profitable without making your personal information the product. I’m happy to tell you all about how we make it work (and how other companies can, too).
Though first, if you’re not familiar with DuckDuckGo, we are an Internet privacy company that empowers you to seamlessly take control of your personal information online, without any tradeoffs. We operate a search engine alternative to Google at http://duckduckgo.com, and offer additional apps and extensions to protect you from Google, Facebook and other trackers, no matter where you go on the Internet.
The Big Myth
It’s actually a big myth that search engines need to track your personal search history to make money or deliver quality search results. Almost all of the money search engines make (including Google) is based on the keywords you type in, without knowing anything about you, including your search history or the seemingly endless amounts of additional data points they have collected about registered and non-registered users alike.
In fact, search advertisers buy search ads by bidding on keywords, not people. It makes intuitive sense, too. If you search for ‘car’, you are more likely to respond to a car ad than something you searched for last week.
For example, if you type in ‘dishwasher’ you will get a dishwasher ad.
Google also makes most of their money via this same type of keyword-based advertising that doesn’t require any search-history tracking.
So why do they track it all then? Because Google is not really a search company; they are an advertising company. On Google, your searches are tracked, mined, and packaged up into a data profile for advertisers to follow you around the Internet through intrusive and annoying ever-present banner ads, using Google’s massive ad networks, embedded across millions of sites and apps.
This is why if you search for something on Google, you may start seeing ads for it everywhere. Using the internet doesn’t have to feel like you’re being watched, listened to, and monitored.
Google, Facebook, and The Creepy Line
Eric Schmidt, former Google CEO and Chairman, famously said “Google’s policy on a lot of these things is to get right up to the creepy line, but not cross it.” But for most people, that line was crossed by Google, Facebook, and others long ago.
Alarmingly, Google now deploys hidden trackers on 76% of websites across the web to monitor your behavior and Facebook has hidden trackers on about 25% of websites, according to the Princeton Web Transparency & Accountability Project. It is likely that Google and/or Facebook are watching you on most sites you visit, in addition to tracking you when using their products.
As a result, these two companies have amassed huge data profiles on individuals, which can include interests, past purchases, search, browsing and location history, and much more. This personal data is stored indefinitely and used for invasive targeted advertising that can follow you around the Internet.
This advertising system is designed to enable hyper-targeting, which has many unintended consequences that have dominated the headlines in recent years, such as the ability for bad actors to use the system to influence elections, to exclude groups in a way that facilitates discrimination, and to expose your personal data to companies you’ve never even heard of.
The operative question is, though, is all of this tracking necessary to make substantial profits? Is this the only way to run a profitable digital consumer focused service company? Not in my opinion. The fact is, these companies would still be wildly profitable if, for example, they dropped all of these hidden trackers across the web and limited the amount of data they keep to only what is most necessary.
Yes, this additional tracking probably helps them compete with each other and adds some incremental revenue, but I believe the vast majority of their revenue would still exist if the tracking dial was turned way down, and they backed far away from the creepy line.
The reason is simple: Google and Facebook are the undisputed champions of audience and reach across the internet, something advertisers will always pay for. Their business models don’t need to be this invasive.
It is a choice to squeeze every last ounce of profit at the expense of privacy, democracy and society. A choice they don’t have to make. Without all this tracking, I’m confident they would still be among the most profitable companies in the world, and we’d all be better off.
As mentioned, DuckDuckGo is profitable based mostly on keyword-based search ads, though we have always been on the search for other ways to anonymously make money so that we can reduce the dependence on advertising. The only other way we’ve found so far, which currently accounts for a much smaller portion of our revenue, is non-tracking affiliate partnerships with Amazon and eBay.
When you visit those sites through DuckDuckGo, including when using !bangs, and subsequently make a purchase, we receive a small commission. This mechanism operates anonymously and there is no personally identifiable information exchanged between us and Amazon or eBay. These partnerships also don't affect the ranking of search results. The reason we can do this in an anonymous way with Amazon and eBay, though not with other retailers, is because Amazon and eBay run their own affiliate networks.
What Other Companies Can Do
At the beginning of this answer, I noted that other companies using an advertising business model could follow a similar path to DuckDuckGo. Here are a few actionable things companies can do to remain profitable without tracking the maximum amount of information possible on consumers:
Favor interest-based advertising instead of hyper-targeted advertising. For us, that is basing ads just on the keywords people type in. For others, that could mean basing ads on the content on the page and not on the individual viewing the page.
Sell advertising directly based on such interests, avoiding going through the hyper-targeted advertising systems of Google and Facebook.
Consider using an anonymous affiliate system like DuckDuckGo does as described above. This can help you get away from as much advertising on your pages.
Our vision is to set a new standard of trust online. The Internet shouldn't feel so creepy and getting the privacy you deserve online should be as simple as closing the blinds.