Perhaps nothing can stay ad-free forever.
Brave launched in 2016 as an open-source, ad-blocking, privacy-forward web browser to compete with Google’s Chrome.
But in 2019, soon after Brave exited beta, it began introducing opt-in, rewarded ad experiences. Two years later, after acquiring search platform Tailcat (formerly Cliqz), Brave rolled out its own search advertising experience.
Since then, Brave also added takeover display ads when users open new tabs, plus limited pop-up notifications.
Fact is, a browser without a search engine – and search ads – just doesn’t make any sense, according to Brave’s ad chief, Jean-Paul Schmetz, who also serves as CEO of Ghostery, an ad-blocking browser extension. (He helped build the Tailcat tech that now underpins Brave’s search engine, too.)
“I’ve always been fascinated by this idea that if people tell you what they want, and you give it to them, it kind of works,” he said, “versus the more interest-based advertising where you’re trying to change people’s minds.”
But one thing that hasn’t changed, Schmetz emphasized, is Brave’s stance on ad tracking. “It’s not programmatic,” he said of Brave’s approach. “It’s not trying to figure out that you were looking at gloves on Amazon 10 minutes ago, so I’ll give you an ad for gloves.”
Schmetz spoke with AdExchanger about competition in the search and browser markets, the fallout from the Google Search antitrust ruling and whether AI search will help smaller upstarts compete with Big Tech.
AdExchanger: Brave doesn’t share user data with third parties, so how do you target your ads?
JEAN-PAUL SCHMETZ: By the query itself and the user’s country. Nothing else plays a role. If you type “buy lipstick,” I don’t care if you’re a man or woman, I’ll give you a lipstick ad. If you want to go to Amsterdam, I don’t care if you’re rich or poor, we give you all the hotels.
For our new tab takeover display ads, there’s no targeting except the country.
What’s Brave’s philosophy on cookies and alternative IDs?
We never use third-party cookies and we don’t track any ad IDs.
The browser can remember ad exposures. It can tell if you click on a search ad and whether, 30 days later, you visit the “thank you” page. We have a sync feature [that enables this], but the data is encrypted from us.
Brave never blocks first-party cookies.
Do you have any optimism that Google will ever have to divest its Chrome browser?
Not at all.
How should regulators promote competition in the search market following Judge Amit Mehta’s ruling last year that Google operates a search monopoly?
I’m not sure what a Chrome divestiture would achieve. The main remedy would be to stop Google from paying browsers to force people to use Google Search – and the court did not say Google can’t do that.
What I recommended to the Department of Justice, but they didn’t push for, is that Google should pay any browser that brings them traffic [regardless of whether there’s a search licensing deal]. Then, even Brave users who use Google Search would have value to us.
Why should Firefox get $400 million a year from Google and we get nothing? Google would be a lot less powerful of a monopoly if it had to spread money around without the condition of “only if you don’t compete with us.”
Besides, if Google were forced to divest Chrome, then Chrome would go bankrupt within 10 minutes. There’s no way to monetize a browser unless you have your own search engine or a search deal.
Judge Mehta ruled that Google has to renegotiate exclusive search deals annually and share search data with competitors. Will those remedies have any impact?
This is being appealed, and it’s going to take a while.
But if Apple is getting $20 billion a year, it’ll renew every year. Apple isn’t suddenly going to say, “I won’t take the $20 billion this year because I want to live dangerously.”
On data sharing, Google asked the judge to stay the remedy so that it’s not implemented until after the appeal.
Has the rise of generative AI search changed competition in the browser or search markets?
Not yet. When people have a question, they look for the first search box that’s able to answer that question in the browser.
AI search has made it harder for publishers to get organic search traffic. Do publishers buy your search ads?
It’s too expensive. Search advertising has never been a workable path for publishers, because you end up paying, like, $1 per click and monetize at a $5 CPM.
Typically, they’ve gone the SEO route, which works at Brave the same way it works at Google – as in, I would say, less and less. The flywheel we’ve had for the last 20 years has been basically dismantled, whether by AI or other things.
What advice do you have for publishers?
I have 30 years in publishing [including as chief data scientist for German media and tech conglomerate Hubert Burda Media dating back to the mid-’90s], so I’m quite sympathetic to publishers.
If the summary of your content is as good as your content, you have a problem. You have to create content that needs to be experienced. That’s why video, podcasts and original content are working so well compared to more traditional publishing.
What was your reaction to OpenAI introducing ads?
It’s logical. If people tell you what they want to buy, you should give them ads, because it’s hard to answer commercial intent only with organic content.
For example, StubHub only advertises if they have seats for sale. But organic search can’t index these things very well. If you click on a search link for an event, and there are no seats left available, it’s frustrating, whereas the ad is actually quite helpful.
But what OpenAI is doing isn’t real search advertising. It’s just sponsored queries.
Are we in an AI bubble, and will all AI search companies eventually need advertising to be sustainable?
Yeah, but I don’t know why a bubble would be bad for users.
There’s precedent for this. In the late ’90s, people were laying fiberoptic cable for broadband internet. Some investors lost money because they invested too much or too early, and some companies like WorldCom went bankrupt. But the broadband infrastructure was there when we needed it.
If the AI bubble collapses, you might have a recession. The stock market and portfolios will suffer. But it doesn’t go back to the way it was before.
And if you want advertising to save your butt when the going gets rough, that’s hopeless. I was part of that first internet bubble, and when the shit hit the fan, advertising really hit the fan. Advertisers will panic before anyone else.
This interview has been edited and condensed.
For more articles featuring Jean-Paul Schmetz, click here.
