In this episode of The Decentralists, we discuss Brave -- a so-called “private” web browser that just blew-up its own reason to exist.
Until recently, Brave was lauded as the world’s most privacy-centric browser. That is, until their hand was caught in a private cookie jar. Mike, Henry, and Chris ask:
In hindsight, Brave’s bad behavior was easy to predict -- many of their promises were too good to be true.
And just why is Peter Thiel, world-class privacy violator, funding Brave?
In this episode of The Decentralists, we discuss Brave -- a so-called “private” web browser that just blew-up its own reason to exist.
Until recently, Brave was lauded as the world’s most privacy-centric browser. That is, until their hand was caught in a private cookie jar. Mike, Henry, and Chris ask:
In hindsight, Brave’s bad behavior was easy to predict -- many of their promises were too good to be true.
And just why is Peter Thiel, world-class privacy violator, funding Brave?
Henry : Hey everyone, it's Henry, Mike, and Chris of The Decentralists, it's time for another Hot Topix and it's been a busy week. There's something that I know that they want to talk about called Brave, I'm not an expert, but Mike, why don't you start us off?
Mike : Well, Henry, thanks for the warm intro, yeah, we have another Hot Topix this week, back on the 8th of June Shoshana Wodinsky from Gizmodo, broke a topic on the Brave browser blowing up their whole reason for existence. And I know that Chris and I have talked about this one because it was actually very, very kind of ironic the article itself. But Chris, I know that you have a lot to say about Brave, so why don't you give us the intro to tell us what we can expect with the Brave browser?
Chris : So, the first thing that you need to know about Brave is not just a regular old web browser, this web browser is meant to be the ultimate in privacy. It was founded by Brendan Eich, if you don't know who that was, he was a former CEO of Mozilla and he is the fellow who created JavaScript, which is, yeah, a pretty big deal, it's one of the primary languages of the world.
Mike : So, somebody who knows what he's doing?
Chris : He absolutely knows what he's doing. So, not only was Brave meant to be the ultimate in private web browsing but they were offering all of this stuff for free and not just for free, but if you surf for a certain amount of time and go into their revenue sharing program. Well, Brave was supposed to pay you for web browsing. So, what could go wrong?
Mike : Oh man, I'm betting a few things.
Chris : What are you betting, Mike?
Mike : Well, I think that part of the problem is that what we've seen in this article by Wodinski is the fact that a lot of these private browsers; Mozilla has them with Firefox, you even have little private buttons on Safari and on Chrome. But Brave was one that was built with the intention of providing a private browsing experience, coming from these pure backgrounds of open-source and all of these types of things, you expect these tools to deliver what they say, especially when they're supported by an open-source community that's there to keep the developers honest. And what I found interesting about what was reviewed this week is it turns out that Brave has been less than honest with its users.
Chris : That's absolutely true. So, whenever it comes to a piece of software, you always have to ask yourself, well, how do they make money? Because, if their need to make money compromises their reason for existing, then you have a problem, so Brave was, or it still is, it's a free web browser, so they have to make money somehow. And the way that they said they were going to make money was through something fairly convoluted called a Basic Attention Token.
I'm not going to get into the details here because it is convoluted, but basically, the amount of attention that you give to the Brave web browser that was supposed to turn into money and then through the magic of blockchain and other hocus-pocus users of Brave were supposed to get paid.
Henry : Do you mean, Chris; that this browser could see or monitor what you're watching, then go to that progress service and get money from them and then eventually pay you? Is that what you meant?
Chris : Yes, and Henry, now you're seeing kind of the problem here, which is.
Henry : It's complex.
Chris : Not only is it complex, but there's a contradiction here, which is if you're supposed to be the ultimate in privacy and yet it's monetizing attention, well, whose attention are you monetizing and how do you find out?
Mike : Without monitoring them, without tracking them?
Chris : Exactly. So, that has to be convoluted, there has to be a special sauce to make that happen. And finally kind of looking at this through a skeptical eye, we have to ask ourselves, well, who is funding Brave, and where are their reasons?
Henry : And by the way, when you talk about funding, it should be obvious to everyone, but anything has to be funded because you have these workers who have to create it, who actually have to write it, put out their host, that sort of thing, nobody does it for free. So, that's the essence of funding because nobody can afford to live and work for free.
Chris : Absolutely.
Mike : Well, and let's take that a little bit further though, Henry. What you have is that a lot of these things like Brave and other kinds of applications like this come from what is typically an open-source background. And kind of the challenge with open-source itself, if it's pure open-source, which Brave may not be. But at the end of the day, when it's an open-source project, what you typically have is, you have a bunch of really smart people who get together and they build a tool for people to use for free.
And the downside of that is that it's usually like a pet project, it's a couple of people or four or five people who just get together and they build something, but they don't necessarily support it, they don't necessarily have manuals or user guides and things, so it never usually makes that move into the mainstream of software. What happens in some cases is some really cool open-source, like the Linux operating system and then the Linux operating system gathers steam because it fulfills a particular need for the technology people that build it.
And then as it gets bigger and bigger, the Linux operating system, now all of a sudden you wrap a banner around it, you put a user guide on it and an 800 number, you rename it, Red Hat, and now an enterprise can buy it. So, this is kind of like an honest path to revenue for something that is an open-source project or for any kind of software tool. Sorry, Chris didn't mean to interrupt there.
Chris : Correct. But when it comes to this stuff, that's free, we have to look at who is funding the project because when we look at who is funding the project, we uncover, what is the motive for the project's existence. Now, I personally have a problem with the fact that Peter Thiel is one of the primary funders of Brave and why is that a problem? Because Peter Thiel is one of the worst offenders when it comes to online surveillance, he runs Palantir.
Henry : Now, what's his background?
Chris : Peter Thiel runs Palantir, which is one of the primary government contractors for surveilling and keeping watch over citizens. So, the US government is one of the primary customers of Palantir and basically, if the US government wants to find out what its citizens are doing, Peter Thiel and Palantir is the go-to guy. So, that's the first problem I have with Peter Thiel, the second problem is that he is also a board member and very, very early investor in Facebook and as we all know, Facebook recently just last year, paid 5 billion dollars in FTC fines for privacy violations, now why are we trusting Brave to be the ultimate in privacy when, Hey, Peter Thiel gets to call the shots.
Mike : Which is the case, right, and now we're starting to hit it, Peter Thiel gives them money and now they have to answer to Peter Thiel.
Chris : Yeah, so we have a convoluted way of making money through attention, we have an investor who is one of the worst offenders when it comes to privacy and we have a browser that says it's the ultimate in privacy, what can ever go wrong? So, Mike, in the Gizmodo article here, why don't you tell us a little bit about how they got in trouble?
Mike : Well, basically, it's quite funny, what they're talking about is that basically, in a browser that is supposed to be completely private and not doing any tracking or any of this kind of stuff, so that you could feel secure using it. People were actually noticing that when they were typing in URLs like to do a search if you look close enough, you saw that the URL was being changed and redirected to an affiliate website, so the idea was, is what Brave was actually doing was you were typing something in, let's say you were typing in Bitcoin.
And what it would do is it would send you to a known affiliate of Braves website for information on Bitcoin, which means, guess what? They're targeting your search, and they're sending it to a known affiliate where they get a cut because they sent you there. And I thought that this was astronomically bad until Chris told me about something even more egregious just this afternoon, Chris, talk about Brave and advertising.
Chris : So, one of the things that makes Brave different is that Brave by default turns off ads, so while in most web browsers like Firefox and Chrome, you have to download Adblock and allow it, Brave turns all of this off intentionally.
Mike : Sounds like a good thing, right?
Chris : Yeah, sounds like a good thing until you realize that a lot of these advertisements are replaced by Brave Zone advertisements.
Mike : Wait for a second, explain that to me.
Chris : So, you go to somebody's website, a mom and pop website, Hey, they're just a mommy blogger, they support themselves through ads, on Brave, you don't see these ads, at least not the ads that are pushed through the blogger, instead, you see Brave's ads. Yep, Brave replaces website ads with their own ads, and the way that they justify this is by saying that 80% of the revenue from those ads goes back to the web browser, like people who browse through Brave, that's how they justify it, they say, Hey, you get a cut.
Mike : Wait for a second, so what you're telling me is that they come out and they launch something saying, we're just going to be completely private adblocking, blah, blah, blah and we're going to reward people for the amount of time that they spend on the browser. And then what they're really doing on the back-end is making tweaks in what they do so that they're basically driving revenue that you would have driven anyway because the reality is that the mommy blogger's ads on her blog are what she makes money off of.
And if people view those, if people view her blog through the Brave browser, which she has no control over, she makes zero money off of that ad and Brave makes the money and just pays it back to the people on the platform.
Chris : Ideally, but there are also controversies with that because a lot of folks, such as YouTube creators say that they haven't been compensated. So, you have this convoluted system that is all about your attention and monetizing your attention and they do it through tokens, sounds all very convoluted but basically, the way that I would describe this whole thing is how private can your web browser actually be when it's other contradictory mission is to monetize your attention. Whose attention, how does Brave know who is paying attention?
Mike : So, basically what you're saying is that this pretty much could potentially be coined as the Thiel effect, let's think about it, one of the things that's clearly a challenge for any company, we've all gotten used to this idea that everything's free. If your app isn't free in the app store, nobody's going to download it, nobody's going to use it, and so the contradiction there is, Facebook's free and back in the days before they had the timeline and all these other things, Facebook was basically a scrapbook that people shared too much personal information with, but they didn't really have a way to make any money off it.
And then bingo, all of a sudden, the newsfeed shows up and ads start popping in and algorithms start controlling where the traffic goes, it sounds almost identical to Brave. The only difference is that Facebook was meant to be kind of a bigger kind of alternative to Myspace and a bunch of those other kinds of community apps that existed at the time and then all of a sudden, bang, they turn into this kind of all-encompassing vacuum of misinformation and advertising.
Because an investor who now controls the purse strings and the people who program the code in this case, Peter Thiel says, it's time for you to make some money because I want to make some money on my investment and maybe this is the same thing that's happened with Brave. It's quite likely that it's the same thing that's happened with Brave.
Henry : Okay, so, guys, they've been exposed, what has been the fallout, or is it too early and what do you think that the fallout is going to be?
Chris : One of the nice things about Brave being based upon open-source software is that there is now a fork of Brave called Braver.
Mike : Ah, that's great.
Henry : So, what's that?
Chris : So, Braver is the version of Brave that removes all referral codes, attention token integration, and various ad wear.
Mike : So, basically removes, the Thiel effect.
Chris : Removes it, exactly. So, in this version Braver, there's no more ad wear, nobody is trying to monetize your attention, and guess what? If you do a search for Bitcoin, your browser won't input a referral code, which means that they're not going to make money off of you that way.
Mike : And so, basically the idea is, if we want to distill this whole thing down, where kind of the people's head should be going something with because it sounds innocuous things like this, but what this is to me is an indication that people need and are demanding now more honesty and transparency in everything right down to the business model level. I don't think that it was Tim Cook that actually coined the phrase, but Tim Cook got a lot of credo for the phrase, if the product is free, you are the product.
And I think that is now, kind of the thing that I think is going through most people's heads or should be going through most people's heads when they are doing, what lots of people are doing right now, guys, is that they're looking for browsers that'll protect their privacy and messaging systems that'll protect their privacy. And other applications that they use on a day-to-day basis that will keep their privacy and allow them to do things like organize for protests or things like this and when you're out looking for these things and that service is free, you have to look for the hook.
There has to be something there now, or in the very near future that could change what you're doing, and so, if you start to think, remember guys, we've used this article or this kind of analogy before, but back in the early days, Napster and all of these bit torrent based music and file-sharing services. Where basically you could download all these songs and things for free and you start to realize that somebody's not making money off it, the music industry wasn't making money off it, Napster got sued out of existence, all of these things.
And what does Apple do, Jobs turns around and says, we're going to create this thing called iTunes and we're going to charge everybody a buck a song and I remember that they got laughed off of the planet when they came out with that. Laughed off of the planet, why would I pay for whatever I can get for free if I just go onto BitTorrent and look you flash-forward now and they basically are a platform, everybody pays for these things because right now we're in a different world where lots of people, they want to acknowledge people who create content.
And they want to make sure that people get their fair share of revenues, like the mommy blogger, she should get her revenue if she's going to spend her time writing up a blog that helps other moms with issues, things like this. And the challenge is, what do you do when you build your revenue stream on a platform that betrays you?
Henry : Well, said.
Chris : Exactly, Mike, I think that the other reality is that you have to be transparent about how you make money; one of Brave's problems was that the way they purportedly made money is, well, it wasn't transparent, it was very convoluted. How am I supposed to know what a basic attention token is? How am I supposed to know what that's worth? How do you convert something as amorphous as attention into real, tangible currency?
Mike : By referring people to advertisers, that's how you do it, clearly, which is what they had in their intention all along.
Chris : Well, yeah, clearly, you can measure things like time on site, you can measure things like click-through, and all that other stuff, that's tangible, what's not tangible is something like attention.
Henry : The online world has got to get more like the physical world, in other words, if I want a product or service, I go out and I buy it and I pay for it. Online, it's nebulous, if I don't pay for it, then yeah, how do they make money and what are they getting from me?
Mike : No, I think, I think Henry that you have basically kind of came to a, I think that this is the concluding point, I think that the idea simply is that this attention to something like Brave has done, and we're focusing on Brave and there are lots of other applications out there that are like this, and there will be lots more. But the reality is I think that what we're seeing is potentially kind of a seismic shift in just the day-to-day viewpoint of applications on the internet.
I think that you're going to find that more and more people are going to be looking at applications that are free and wondering what the catch is, in fact, anticipating the catch, there has to be something. If you go to the car dealership and they give you the car for free, or your grocery store gives you your groceries for free you know that something's going to happen.
Henry : Isn't that interesting, you're absolutely right. When it happens in real life, your spidey sense says, wait for a second, what's going on? But when it happens online.
Mike : look, my grandfather used to say, my dad, everybody, there's no such thing as a free lunch but on the internet, there's no such thing as a paid-for app, it makes no sense. So, basically, human nature and common sense will tell you that if you're not going to pay for it, if the person says this car and you look at the lot and it says free on all the windows, you know that there's something wrong.
It doesn't matter, it says that it's free, like something's going to happen and I think that what you need to do now is if you have good people programming good technology, or building a good product and your product has a market; then I think that you have to be honest with people that, Hey, it costs money to make this app or this loaf of bread or this car. And somebody has to pay the salaries of the people that do it. And if you're not honest and transparent at the outset when you first go to the app store and download the app and you look at this thing and you're like, it's free, there's something wrong.
And if they say, you know what, I don't need a lot of money, I need a dollar or whatever the number is, you need to evaluate it based on the service that you're using it for and if you're building your mommy blog on a blogging platform that actually costs you to buy it, that means that you're paying for that thing to deliver the service that it says on the tin.
Henry : Yes, and you've defined that, that value is worth paying for it's classic, it's nothing new, it's just basic economy,
Mike : Basic economy.
Chris : I think that the good news is, is that I believe that the Braves of this world are not long for this world. I think that their time in the sun is coming to an end, I think that people are investing more and more in software as a service, people are willing to pay for Netflix, they're willing to pay for Microsoft Office 365, it's only a matter of time in which, Hey, what's the price of privacy, a little bit of money.
Henry : Well said, Chris, both of you, Mike, Chris, very good insights and I think that the conclusion is, just be transparent and you'll be successful. Thank you, boys, really appreciate it.
Mike : Thank you, Henry
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