Brave founder Brendan Eich
Brave hopes to build a better online advertising ecosystem that works for both users and publishers, but a group of 17 publishers are demanding that the new web browser company cease and desist.
Brave, which recently launched for iOS, Android, OS X, Linux and Windows, exists as something between ad blocker and ad server. In its current form, it works as an ad/cookie blocker, but is designed to soon replace existing online ads with those it considers “safe” (i.e. those that don’t track users with unique identifiers and have been screened for malware) and faster loading to improve the browsing experience.
After swapping in its own ads, the company intends to compensate publishers for part of the revenues generated on their website — revenues that would have otherwise been lost had the user employed any of the other ad blockers currently available on the market.
However, an open letter addressed to Brave CEO Brendan Eich and signed by 17 of America’s biggest publishers, called the company’s approach “blatantly illegal.”
“You are hereby notified that Brave’s plan to replace our clients’ paid advertising content with its own advertising violates the law, and the undersigned publishers intend to fully enforce their rights,” reads the open letter published in full on Business Insider.
The group, which included Dow Jones, Gannet, The New York Times Company, McClatchkey and The Washington Post, among others, all belong to the Newspaper Association of America (NAA), which represents 1,200 newspaper companies in the U.S. Together, they are seeking damages of up to $150,000 per work.
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“Brave’s use of publishers’ trademarks to sell its own advertising will confuse consumers, infringe upon publishers’ exclusive rights in their brands and dilute our highly distinctive marks,” the publishers said.
“We stand ready to enforce all legal rights to protect our trademarks and copyrighted content and to prevent you from deceiving consumers and unlawfully appropriating our work in the service of your business. Unauthorized republication of our copyrighted content to support Brave’s illegal advertising model violates protected rights of publishers under the Copyright Act and other laws.”
Brave says its system would see publishers claiming 55% of the ad revenue that results from users visiting their websites. That money awaits their collection in an online wallet while Brave collects 15% and distributes another 15% to its ad partners.
“If we can do a better job with having private, anonymous ads, then they will perform, we will get paid and we will share the wealth very generously with publishers,” said Eich, in an interview with Marketing prior to the release of the NAA’s letter. “We think [the publishers] will get a better revenue share with us, the user will keep their data private and anonymous, and the user can get a share too.”
Interestingly, Brave’s users themselves will have the option of collecting the remaining 15% via Bitcoin — which Eich estimates will around US$50 to US$100 per year — or distributing the money equally among their most-visited websites in exchange for blocking ads on those sites.
“Ultimately, it’s not in [publishers’] interest to spend a lot of money trying to fight us if we’re dropping 55% of the revenue directly on them,” said Eich. “The users’ 15% trickles out in micropayments to certain sites. That’s an aggregate share of 70%, and that’s a lot. That’s more than they’re getting from programmatic partners.”
Second-time Disruptor
This is not the first time Eich has reengineered the web browsing experience. As the former CEO and co-founder of Mozilla, which created the Firefox browser, Eich is considered a “Javascript pioneer” and web browser expert.
“We think the current system of third-party tracking and advertising has failed not only users, but publishers,” he said. “It’s not leaving enough revenue on the table after all the trackers and middlemen take their cut.”
While payments to users are not yet available, once downloaded, the Brave browser tracks and reports each second the user saves by not waiting for ads to load on a page, and those seconds add up quickly.
But it’s clear that, so far, publishers aren’t having it.
“We continue to support our members’ interest in their cease-and-desist letter notifying Brave of its planned unlawful activities,” said David Chavern, the CEO of the NAA, in a statement provided to Marketing. “While we appreciate Brave’s interest in defending its business model, and would not have expected otherwise, we continue to view their proposition as crossing legal boundaries.”
Eich disagrees with this assessment, calling the cease and desist letter “filled with false assertions” in an open response to the NAA. “We categorically reject the claim that browsers perform ‘republication,’ and we repeat that Brave has a sound and systematic plan to financially reward publishers. We aim to outperform the invasive third-party ads that we block, with our better, fewer and privacy-preserving ads.”
The response, however, will likely do little in convincing publishers to stand behind Brave.
“From an ethical standpoint, they’re totally capitalizing on the issue, the problem the industry is facing, which is ads in general,” said Sonia Carreno, the president of IAB Canada, whose members include marketers, ad agencies, media and tech companies. “They’re not reinventing anything. Basically, they’re siphoning it off, they’re taking power away from the publishes.”
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Carreno, for one, has her doubts that Brave will reach the critical mass required to provide publishers with significant revenue, and views the startup as just another variation of the same old ad blockers wreaking havoc on the advertising industry today.
“I applaud it for the due diligence that it’s done in its privacy. But I do believe this is a long shot to make it work. And to the industry, it’s seen as just another ad blocking scheme to siphon off publisher revenue,” she said. “That does not do any favours to the industry.”
Carreno is concerned that publishers will not be aware of the digital wallets Brave has filled with their ad revenue, that subscribing will become too much of a burden and that those funds will eventually be forgotten or distributed elsewhere.
But Eich would disagree. “We create the wallet for them and we make the verification process really lightweight,” he said. “We’re not forcing the publisher to do extra work. We’re saying ad blockers are here, we’re moving to a majority of web users using an ad blocker, and that’s going to leave the publisher with nothing.”
In spite of the controversial nature of the company, Carreno suggested there is a silver lining for both Brave and publishers from this now very public disagreement.
“The good news is that the discussions on blocking ads is creating a globally ripe environment for innovation in the online media landscape,” she said. “We’re in for some interesting new interpretations of what media could look like in the future using the digital channels, we just need to ensure that it is respectful to the well-established publishing community and the hundreds of thousands of content creators working to provide a rich online experience to consumers.”
In the meantime, Eich appears hopeful that the industry will come around to this way of thinking. “The NAA has fundamentally misunderstood Brave,” he wrote in his open letter. “Brave is the solution, not the enemy.”
