Google Explains Online Advertising and Funds Academics to Expand its Clout

Here's a very useful discussion of online advertising via a recent Google post [excerpt]:  "Consider online advertising, which is based on principles from algorithmic game theory and online auctions. The Internet has enabled advertising that is more segmented and measurable, making it more efficient than traditional advertising channels, such as newspaper classifieds, radio spots, and television commercials. These measurements have led to better pricing models, which are based on online real-time auctions. The original Internet auctions were designed by the industry, based on basic economic principles which have been known and appreciated for forty years.

As the Internet grows, online advertising is becoming more sophisticated, with developments such as ad-exchanges, advertising agencies which specialize in online markets, and new analytic tools. Optimizing value for advertisers and publishers in this new environment may benefit from a better understanding of the strategies and dynamics behind online auctions, the main driving tool of Internet advertising."

Google has funded several scholars to help it "foster collaboration and interdisciplinary research by bringing together world renowned computer scientists, engineers, economists and game theorists to analyze complex online auctions and markets."  Clearly what's needed are independent scholarly efforts to address the impact on civil society that the expansion of personalized data mining and targeting will have.