Monday, October 2, 2017

Mining, Not Ads

Last week, the internet changed dramatically and you probably did not notice.  This has nothing to do with Net Neutrality, though that is a big thing that may change the internet in ways that are hard to imagine.  Instead, it has to do with how websites make money.

The news story that you probably heard was that the CBS and Showtime websites were set up so that when you browsed their sites, your browser ran a script that 'mined' a crypto-currency.  It turns out that, in this particular case, the code to do this was not authorized by CBS and that some programmer did this in the dark for their own Superman III/Office Space style scam.

What you did not hear was that the mechanism that this back office Richmond used to do all of this is actually legitimate.  Just not approved by CBS.  And it can help monetize web content AND minimize advertising.  How does all of this work?  Read on.


The crypto-currency in play here is called Monero (symbol XMR in the world of digital coin exchanges).  It is similar to BitCoin in that there is no physical thing to represent it.  No dollar bills or minted coins.  Instead, it exists purely as bits that say so and so has so many Monero tokens.  It only has value because everyone says it does and can exchange it for other things that have value.  In this sense it is no different from any other form of currency.  After all, while we all could pay for everything with hard currency, most of us use our credit cards or debit cards which are really doing nothing more than saying so and so has this much less money in their account and this merchant now has this much more.

Like many other digital currencies, it also can be 'mined'.  A computer is asked to do a series of complex mathematical operations to 'earn' a new Monero token.  It uses a different set of operations from other currencies, but the concept is the same.  In essence, you are trading the time and energy your computer uses for money.

What makes Monero different from other digital currencies (and there are now several hundred out there), are two things.  First, it is highly secure.  And by that, they mean that it is impossible (or at least very, very difficult) for someone to see how many Monero tokens someone else has.  Most digital currencies have some level of anonymity associated with them, usually in the sense that everyone who owns any of them are identified by random number and not by anything directly tied to their name.  Monero takes this farther and hides the numbers from all other users as well.  This makes it a great medium of exchange for things that are a bit fuzzy on the legal side.  Like making your browser tell your computer to mine it without you knowing about it.


Where this becomes interesting is if a website were to tell you about it.  If they were to put up something similar to the "Cookies Warning" pop up that many sites have that said, "Hey, we're using your computer to mine Monero while you are here.  We're doing so that we don't have to clutter up our site with ads and still provide you with great content."

Where replacing ads with currency mining becomes interesting is with Apple and their launch of the iPhone X.  They announced that with iOS 11, they will limit the way that advertisers/sites can follow individuals around the net.  Of course, the advertising world started screaming bloody murder.  How will web sites pay their hosting fees much less their employees?  Only the most altruistic sites post content for free (but only because no one wants to advertise with them).

Monero offers an alternative revenue stream for these sites.  And it does it by using your computer, one that is more than likely overbuilt for simply browsing the web.  Will it cost you some extra electricity?  Sure, but usually only while you are on those sites.  And you get fewer, maybe no, ads.

To me, that's worth it.

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