“The open web will not be killed by regulators or hackers. It will be killed by ROAS targets and quarterly revenue goals.”
The open web is losing ground because money is moving somewhere else. Ad buyers keep shifting budgets into closed platforms where attribution looks cleaner, CAC is more predictable, and LTV models update in real time. The traffic is still there on the broader web, but the revenue multiple belongs to the walled gardens.
The market does not care about philosophical arguments around openness. It cares about unit economics. Investors look for channels where acquisition spend connects to revenue with fewer unknowns. Right now that means buying traffic and attention from companies that own identity, distribution, and billing in one place: Meta, Google, Apple, Amazon, TikTok, and a small group of vertical platforms.
The trend is not fully clear yet, but the direction is hard to ignore. Each year, more user time moves into closed environments, more first‑party data concentrates inside those environments, and more brands accept that scaling growth means renting access from a handful of gatekeepers. The open web is still large in absolute terms, but its influence over where money flows keeps shrinking.
Why the open web had the early advantage
In the early 2000s, the open web looked like the perfect growth machine. Search drove intent. Blogs and forums built trust. Display networks stitched everything together. A small team could launch a product, rank on Google, buy some banner traffic, and build a brand.
The economics made sense:
– Traffic was cheap.
– SEO felt stable.
– Cookies tracked users across sites.
– Retargeting printed money.
Investors loved this story. Founders could show a path from content and SEO to sales with a CAC that looked sustainable. The narrative was simple: publish more, rank higher, convert better.
Then two things happened at the same time:
1. Platforms began to capture more user time and attention inside closed feeds and apps.
2. Regulators and platforms started to restrict tracking across the open web.
The business case for an open, interconnected web started to weaken. Not overnight, but quarter by quarter.
Data point: In many markets, more than 70% of digital ad spend now goes to just two or three companies, depending on the country. That is not just concentration. That is a shift in who owns discovery and demand.
What walled gardens actually sell
The phrase “walled garden” sounds like a design choice, but for growth teams and investors, it is a pricing model and a risk profile.
Platforms like Meta, Google, Amazon, Apple, and TikTok sell three things that the open web struggles to match at scale:
1. Identity
2. Attribution
3. Distribution
They do not just sell impressions or clicks. They sell an integrated loop from awareness to purchase with a feedback system that updates in near real time.
Identity as the new “homepage”
The browser used to be the starting point. Now, identity is the starting point.
A logged‑in user on Meta, Google, or Amazon comes with:
– A known history of engagement
– Purchase signals or search intent
– Device data
– Demographic signals or proxies
On the open web, those identities fragment. Cookies expire. Consent banners add friction. Cross‑site tracking breaks. The same user becomes five or ten different “profiles” with no reliable link between them.
Investors look at this and see risk. Attribution models become noisier. CAC calculations wobble. Cohort ROAS takes longer to stabilize. The more uncertainty in measurement, the higher the discount on any growth story based on open web traffic.
Inside a walled garden, the platform owns the identity graph. That graph stays stable across apps and devices. That stability has direct business value: clearer cohorts, more repeatable experiments, and faster iteration on creative and offers.
Expert view: “The company that controls user identity controls the unit economics of customer acquisition,” a growth investor told me. “Everything else is just targeting tactics.”
Attribution: from “maybe” to “probably right”
No attribution system is perfect. But platforms do not need perfection; they only need to be more reliable than the open web.
Post‑iOS tracking changes made this even more visible. Open web campaigns saw more “missing” conversions. Platform data and server‑side tracking tried to fill the gaps, but the story became complex and full of caveats.
Walled gardens respond differently:
– They model conversions inside their own walls.
– They keep the full path from impression to click to conversion under one roof where they control the data.
– They use probabilistic models on top of rich first‑party signals.
For the growth leader reporting to a board, this starts to matter:
– Meta or TikTok says: “Spend 100, we will send you modeled conversions that roughly line up with your actual revenue.”
– Open web says: “Spend 100, then piece together analytics from five platforms, and accept large blind spots.”
One path leads to budget increases. The other leads to “test and learn” with limited scale.
Distribution: owning the feed, the format, and the default
The open web offers a universe of sites with different layouts, content types, and user behaviors. That variety can be rich for users, but it is harder for growth teams that want repeatable systems.
Walled gardens give:
– A small set of ad formats
– Controlled environments
– Predictable engagement patterns
This control removes a lot of noise:
– Creative teams know the canvas.
– Performance teams know the metrics.
– Product teams know where users will land inside the app or site.
The trade: less freedom, more predictability.
For investors, predictable distribution translates into higher confidence when underwriting growth projections. A deck that says “we will scale through paid social and search inside known platforms” often feels lower risk than “we will scale through content, SEO, and open web partnerships.”
How this shows up in growth metrics
Founders do not wake up and decide to abandon the open web on principle. They move budget because the numbers on their dashboards push them there.
Here is a simplified comparison many teams run when they evaluate acquisition channels:
| Metric | Open Web (Programmatic, Direct Buys) | Walled Gardens (Meta, Google, TikTok, Amazon) |
|---|---|---|
| CAC predictability over 3 months | Low to medium | Medium to high |
| Attribution clarity | Fragmented, cross‑platform | Single platform, modeled within |
| Audience refinement speed | Slow; depends on partners | Fast; platform algorithms adjust |
| Testing new creative | Manual, varied formats | Standard formats; strong tooling |
| Retargeting reach | Constrained by cookies and consent | Based on first‑party identity |
| Reporting overhead for growth team | High | Lower |
Growth leaders do not need perfect outcomes. They need channels where spend can increase without blowing up CAC. Walled gardens do not always win on raw performance, but they often win on stability and feedback speed.
Data point: Many consumer companies now run 60 to 90 percent of paid acquisition through 2 to 4 closed platforms, with only a small portion reserved for “open web experiments.”
Why the open web feels worse for businesses now
From a founder or CMO point of view, working with the open web brings real friction that the platforms have learned to hide.
Fragmented data and broken cookies
The removal or weakening of third‑party cookies hit publishers first, then hit advertisers. What used to be normal:
– Track visits across many sites.
– Build retargeting lists.
– Run frequency caps.
– Attribute conversions back to specific impressions.
All of this became harder.
Now, on the open web:
– Each publisher or ad network has its own ID system.
– Consent banners vary.
– Browser rules shift by vendor and version.
– Legal risk adds another layer of review.
For an early stage company, this means:
– More vendor meetings.
– More analytics work.
– More uncertainty in campaign performance.
On a walled garden, the story is simpler. The user logs in. The platform tracks everything inside. The business accepts the platform’s reporting as the de facto truth.
Rising acquisition cost with less control
As open web targeting got weaker, many advertisers saw:
– Higher CPMs
– Lower clickthroughs
– Less precise retargeting
Publishers tried to push up ad prices to compensate for fewer effective impressions. At the same time, quality inventory on the open web became harder to secure without direct deals or private marketplaces.
Walled gardens saw the same macro shifts but had more levers:
– They shifted algorithms toward engagement that drives ad revenue.
– They pushed more automated campaign types.
– They leaned on their data to keep performance acceptable.
From a business view, both sides raised prices. But only one side could credibly say, “We will adjust for you in real time if you trust our automation.”
Compliance and brand safety pressure
Regulatory pressure on privacy and content adds cost for anyone operating on the open web. A brand that buys across many sites must check:
– Content suitability
– Data handling
– Consent practices
– Geographic rules
Walled gardens present a single entity to evaluate. Boards often prefer the clearer accountability: one counterpart, known legal team, established process.
Again, the open web does not lose on principle. It loses on perceived risk and overhead.
Why investors back walled garden-centric growth stories
When a founder raises capital, they are selling a future cash flow story. That story relies on growth assumptions about:
– CAC over time
– Contribution margin
– Payback periods
– Retention
Walled gardens support those assumptions in a way the open web now struggles to match.
Forecasting that passes the “board slide” test
Investors review growth plans through a simple lens: Can this team scale revenue without breaking unit economics?
A deck with charts like:
– “Meta CAC from 40 to 55 over 18 months at 3x spend”
– “Google search CAC stable at 60 with incremental new keywords”
– “TikTok CAC at 35 in early tests, room to 50 at scale”
looks more reliable than:
– “Open web display CAC highly variable, depends on creative”
– “Native inventory source mix shifts each quarter”
– “Content and SEO likely to improve with more posts”
The first set has platform‑level data, a history of other companies scaling with those channels, and a shared understanding between investors and founders. The second set has more unknowns and more execution risk.
Investor comment: “If I see most of the budget in channels where my other portfolio companies already scaled to $100M+, I feel better about the plan,” one growth equity partner said.
Exit stories that reference familiar playbooks
Buyers of later stage companies also prefer predictable channels. A buyer that has seen five brands scale on Meta and Google can understand the dial that controls growth.
Pick two scenarios for a DTC brand at $50M revenue:
– Scenario A: 70 percent of paid acquisition on Meta, Google, TikTok, with consistent CAC and ROAS history.
– Scenario B: 40 percent on open web display and native, 30 percent Meta, rest affiliates and random partnerships.
Scenario A aligns with known patterns. Scenario B raises questions:
– How repeatable is the open web spend?
– How exposed is the brand to inventory quality issues?
– How will regulation or browser changes affect performance?
Lower uncertainty leads to better exit terms. That reality nudges founders and growth leaders toward walled gardens long before exit talks start.
Why users move into walled gardens, and why that matters
This is not only an advertiser story. User behavior sets the ceiling on where attention and money can go.
The open web has more friction for average users
For many users, visiting independent sites now feels heavier:
– Consent banners appear.
– Layouts vary wildly.
– Ad density swings from light to aggressive.
– Account systems differ everywhere.
Inside a walled garden, the platform optimizes for session length and repeat use:
– Single login
– Familiar UI
– Personalized feed
– Integrated payments
Users vote with time and taps. Monetization follows that time. Growth teams follow monetization.
Search is still open, but the clickthrough is not
Search engines remain a primary entry point. But where people land after a search has shifted.
Try product searches:
– “Best headphones” leads to review sites, but also to Amazon, YouTube videos, or retailer pages.
– “Local restaurant” leads to Google Maps, Google reviews, or platform booking links.
– “How to” queries often lead to videos on closed platforms instead of long‑form articles.
Google itself also keeps more users on its own surfaces:
– Answer boxes
– Shopping units
– Maps
– Knowledge panels
The open web still receives traffic, but the highest value queries and clicks often route into environments where the platform captures more of the value chain.
Where the open web still wins
The obituary for the open web would be premature. There are pockets where it still delivers strong business outcomes.
B2B, niche content, and high‑intent traffic
In B2B and complex purchases:
– Search visits to independent sites still convert at high rates.
– Long‑form content builds trust more than short clips.
– Email lists and owned communities carry real value.
For these segments, the open web remains core, because:
– Decision cycles are longer.
– Buyers look beyond feeds for reference material.
– Walled gardens do not cover the depth needed.
Growth teams here use walled gardens for awareness and retargeting while relying on site content, webinars, and newsletters to move buyers to close.
Owned media and brand equity
Even DTC brands that live on paid social know that long‑term value depends on owning something beyond an ad account.
They invest in:
– Direct domains
– Email lists
– SMS lists
– Communities
– Apps
All of these sit on or beside the open web. The problem is not that the open web has no value. The problem is that its role has shifted from primary growth engine to retention and brand layer for many models.
What “the death of the open web” really means for operators
When people say the open web is dying, they often overstate the case. Traffic numbers and site counts show that it is still very large. The real shift is in bargaining power and revenue share.
Control of demand moves away from independent sites
In the old model:
– Search engines drove users to millions of sites.
– Those sites could monetize with ads or direct sales.
– Ad networks stitched demand across them.
In the current model:
– A few platforms intermediate more of the demand.
– They keep more of the ad spend inside their properties.
– They decide which external sites get exposure and on what terms.
This does not kill independent sites. It compresses margins and forces them into niches where they can defend loyalty or direct relationships.
ROAS gravity pulls budgets into closed systems
As long as:
– CAC on walled gardens stays within acceptable range.
– Attribution looks reasonably accurate.
– Experimentation is faster and less painful.
Budget will tilt toward closed platforms.
The open web must fight not only for attention, but also for a fair comparison. When each walled garden grades its own homework and the open web sits on a messy analytics stack, the comparison is not neutral.
How founders and growth teams can respond
The question is not whether walled gardens are winning. They are. The question is how much dependence on them is healthy, and how to use them without giving up all long‑term leverage.
Use walled gardens for scale, not for total dependency
For early stage companies, avoiding walled gardens on principle burns time and capital. The better pattern:
– Use platforms to get initial traction and learn who buys.
– Watch CAC, payback, and LTV carefully as spend ramps.
– Start building direct channels early, even if they look small at first.
A practical mix might look like:
| Stage | Walled Garden Share of Paid Spend | Open Web & Owned Channels Focus |
|---|---|---|
| Pre‑product market fit | 70-90% | Basic site, early content, email capture |
| Early scale ($1-10M ARR or revenue) | 60-80% | SEO, partnerships, referral programs |
| Growth stage ($10M+) | 40-70% | Brand content, community, direct deals, affiliates |
The goal is not to “escape” walled gardens. The goal is to keep them as one input into a broader mix, not the only engine.
Invest where open web still compounds
There are areas where the open web still compounds better over time than closed platforms:
– Email lists increase in value with every send.
– Evergreen content can rank and convert for years.
– Communities create retention that paid ads cannot replicate.
Growth teams can link walled gardens and open web like this:
– Use paid social to drive to content that builds an email list.
– Retarget site visitors across platforms, not just on one.
– Use single‑sign‑on or account systems to tie user behavior across site and app.
This creates a partial identity graph that belongs to the business, sitting on top of the open web, rather than relying only on platform‑owned graphs.
Negotiate smarter with walled gardens by knowing your numbers
Platforms respond to clear signals:
– If you know your blended CAC and LTV, you know how far you can push bids.
– If you track incrementality, you can see which platforms drive net new business versus just catching conversions that would have happened anyway.
The better you understand your own unit economics, the less likely you are to accept every new automated campaign type as a black box to throw money into.
In other words: treat walled gardens as vendors, not employers.
Where this trend likely goes next
The future of the open web will not be set by one regulation or one product launch. It will be shaped by a series of smaller shifts in where users spend time, how tracking works, and how capital flows.
Several patterns seem likely:
More direct relationships, fewer intermediaries
Publishers, creators, and brands that survive will lean into:
– Direct subscriptions
– Memberships
– Merch drops
– Premium content
These models pull value away from ad‑based monetization and into direct payments, which reduces exposure to both open web ad markets and platform ad policies.
Walled gardens will try to look more “open” without losing control
Platforms have strong incentives to appear supportive of the open web:
– Referral programs
– Revenue share for creators and publishers
– Embeddable content
But the underlying economics will still favor keeping identity and billing internal. Expect more APIs and programs on the edges, with the core kept tightly controlled.
The open web becomes more niche and more premium
As generic ad‑supported sites struggle, the remaining independent properties that do well will likely be:
– Highly focused on specific audiences
– Strong on trust and authority
– Less cluttered with third‑party ads
– More direct‑monetized
For growth teams, this can still be a powerful channel, but it will look more like business development and sponsorships than broad programmatic buying.
Final thought: The open web is not disappearing. It is losing the argument for where the next advertising dollar goes by default. For founders, marketers, and investors, the question is how to ride the walled garden wave for growth without letting it own the whole P&L.