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Internet-based media can identify users and send individual users selective information on products. We develop a model that takes into accont the strategic interaction between consumers, advertising firms and a website that has to decide whether to finance the website through targeted advertising or traditional non-targeted advertising. We show that targeted advertising always benefits firms, but consumers are never better off which is caused by price discrimination. We examine the effect of firms being forced to send the same content to all users they address. Interestingly, in this case consumers can also benefit from targeted advertising because price discrimination becomes impossible.