Is Web3 the next phase of the Internet or just a phase?
Discussions around Web3 have really picked up speed. Whether it’s just dipping into blockchain or delving into the metaverse, many brands and advertisers are beginning to take the possibilities seriously. The medium’s staunchest supporters see decentralization as crucial creating an internet with privacy and user control at its heart, and Web3 can be The most viable way to break up Big Tech’s monopoly.
Despite the momentum gathering around Web3 and the opportunities it can afford, the industry seems divided on how it perceives the new technology. Opinions around blockchain, cryptocurrency and decentralization remain mixed Stack Overflow’s 2022 Developer Poll32% of developers have a “favorable” view of Web3, while 31% have an “unfavorable” view.
With the jury still out on the possibilities, we asked industry experts for their views on the advancement of Web3, whether it will truly be the next phase of the Internet, and what challenges might stand in its way.
Web3 can only go so far without regulation
Web3 gives Internet users more control over their data privacy than ever before. But despite advantages such as decentralized data capabilities, the lack of policy in crypto and NFTs has highlighted Web3’s vulnerability to fraud.
Further investment in Web3, once the decentralized currency market picks up again, can help companies successfully engage in public engagement and realize Web3’s potential to overtake Web2. However, until centralized bodies such as governments become familiar with decentralized environments and platforms overcome complex regulations and even outright advertising bans, the ad tech industry is limited by some significant obstacles.
Xavier Klein, UK Marketing Services Director, Making science
Big Tech is holding back Web3, but for how long?
There are some major blockers to the mass adoption of Web3 blockchain-powered Decentralized Identifiers (DIDs) for personal identity protection that will herald the start of the “Next Chapter of the Internet.” DIDs will enable users to transact securely and privately on the Internet, but also get a piece of the data monetization action if they want to sell their DIDs on advertising platforms.
The main blockers are all from Big Tech, who are worried about the impact of implementing DIDs on their current ad revenue. However, Big Tech is under revenue pressure. Meta from Apple’s ATT upgrade in 2021, Google from Microsoft’s investment in ChatGPT to supercharge Bing, and Amazon’s reported cuts in 2023 from overinvestment. So there may be some strategic advantage for one of the Big Tech players to provide a route to mass adoption of DIDs.
Kate Cox, CMO, BrightBid:
Web3 capabilities could rethink the industry
If we can agree that Web3 is about decentralization, our focus on user privacy, data ownership, and more leads us to rethink the ad tech industry.
Besides popular elements like NFTs and Blockchain, a “simple” concept like Composability can turn any brand, publisher or agency into an ad tech layer. A million pound brand campaign that uses Arweave:For example, as a low-cost, permanent database to store its creative, publishing partners, media costs and related contracts in one place that is auditable for 200 years.
Femi Taiwo, Head of European Consulting, Assembly global
Evolving audiences will drive Web3 adoption over time
Web3 and the metaverse are the natural evolution of the web as we know it today and will have a major impact on the ad tech industry. When you think about decentralized technologies and virtual worlds (including games), new possibilities emerge for real-time, personalized advertising and data privacy. Advertisers need to rethink how they reach highly engaged audiences in virtual environments while respecting users’ privacy rights, perhaps through blockchain-based solutions.
Over the next 5-10 years, Gen-Z and Gen-Alpha will become an even more valuable audience born from the worlds of gaming, immersion and creative economies. Expect utility and membership NFTs to be developed into ad tech formats and AI-generated videos, artwork, copy and digital humans that will disrupt the creative industries. Interactive and immersive experiences are already part of the DNA of good brand experiences. Moving people from audience to participant is at the core of Web3 experiences, but these are now being achieved through interaction with AR or virtual worlds.
Sam Field, EMEA Director of Innovation and Creative Collaboration, Yahoo Creative Studios
The potential of Web3 for advertisers is too great to ignore
Web3 concepts can unlock huge advertising potential. Blockchain technology, for example, could transform the way data is used by providing a public ledger that ensures transaction data is verifiable and trusted in the supply chain. At the same time, digital identity wallets put users in direct control of their data and can act as persistent, agreed-upon identifiers that facilitate valuable brand-user connections.
These features reflect Web3’s core ideology of shifting control away from the Internet’s gatekeepers and onto users. In comparison, Meta’s development of the metaverse runs counter to this ideology, as Meta will focus on protecting its walled garden even as its efforts make Web3 more mainstream.
Ben Patley, CEO, Alchemy exchange
Web3 has yet to deliver on its promises, but the future looks bright
Like the Internet’s growth from Web1 to Web2, Web3 will provide an evolutionary step that will enhance current functionality in a consumer-centric manner, particularly through immersion and sovereignty. The last two years have been dominated by the promise of technologies that have greatly outstripped the practical use cases we’ve seen in the industry, either due to abuse or quick cash grabs to capitalize on the broader crypto market.
However, these years of capital-driven growth have also helped to develop these technologies, and despite the market downturn, I am confident that we will see exciting new projects develop in the coming years.
Vlad Panov, Vice President of Web3 Engineering, Publicis Sapient
