Publishers beware: ad blocking has gone mobile
Publishers are already having a difficult time making money off mobile readers, but ad blocking could make it that much harder.
While ad blocking has long been a menace on desktop, it’s still largely a nonentity on mobile phones, thanks to a combination of offensive moves by Google and the difficulty of installing mobile ad blocking software. That’s quickly changing. Adblock Plus, whose browser extension has been downloaded 400 million times, launched on Wednesday a beta version of its new Android Web browser, which will block “annoying” and “obnoxious” ads that appear across the mobile Web.
Adblock Plus isn’t alone. Israel-based Shine Technologies plans to block mobile ads by skipping smartphone users entirely. Instead, it’s teaming up directly with the world’s big cellphone carriers, many of which want to block mobile advertisements in an attempt strongarm the likes of Google and Facebook into sharing their ad revenue.
“The problem with ad blocking software is that you have to download it, and not everyone can or knows how to do that,” said Shine Technologies CEO Ron Porat. “We’re using the pipes of carriers, so there’s very little ability for the other side to stop what were doing.”
Mobile ad blocks say their cause is just because mobile advertising is a drain on smartphone batteries, is commanding an increasing amount of data and comes with a host of privacy concerns. A 2012 study from Purdue University found that 65-75 percent of the battery energy used by free apps went to advertising functionality. A Microsoft study a year later found that the top 15 free Windows Phone applications used 23 percent of their energy usage to fetch and display mobile ads. Likewise mobile advertising accounts for roughly 2 percent of mobile data usage, according to Citrix. That number will only increase as video advertising continues to climb.
The rise of mobile ad blocking threatens to complicate an already-fraught financial picture for publishers when it comes to mobile. While Americans spend 20 percent of their media consumption time on mobile, ad spending there is less than 5 percent of the total, according to data from Mary Meeker’s 2014 Internet Trends report. Publishers are seeing the same trend on a micro level, where mobile readership is climbing far faster than publishers’ ability to monetize it. The situation has gotten so dire that many publishers are now turning to the likes of Snapchat and Facebook to help them monetize their mobile audiences.
The ad blockers aren’t apologetic about what their technology could do to publishers’ businesses. “Some publishers have strong businesses; others don’t,” Porat said. “The ones that have shaky business will suffer from this and fall. The ones that have a solid business will still have solid businesses.”
Mobile ad blocking threatens to compound what is already a massive and growing issue for publishers. The global ad-blocking monthly active user base topped 144 million people last year, almost double its numbers from 2013, according to PageFair. And that number will only climb as younger, digital-savvy Web users take up an increasing part of the overall Web population.
“Mobile is the perfect storm for ad blocking ultimately being an even larger issue than it’s quickly becoming on desktop,” said Jason Kint, CEO of Digital Content Next. “It’s heavily reliant on direct response, behavioral targeting and intrusive advertising in what is a more intimate and personal experience.”
But publishers aren’t keyed in on the mobile ad-blocking threat — in large part because mobile ad blocking is still a non-entity relative to desktop ad blocking.
“Our focus on the moment is desktop,” said David Morris, chief revenue officer at CBS Interactive. “I assume this will only be an issue in browsers, but the tech is changing all the time.”
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