Consumers block ads. Publishers block ad blockers. What's next?
There’s a standoff on the internet between consumers and publishers. It's difficult to see how anyone can win.Mary Meeker’s 2016 Internet Report and the Reuters Institute Digital News Report both spotlight the deadlock in digital advertising between consumers and publishers.
Consumers, fed up with intrusive and bandwidth hogging ads, are blocking them using apps and browser plugins.
Meeker reported global ad blocking at 400 million in June 2016, equivalent to around 12.5% of the 3.2 billion internet population.
According to Reuters ad blocking is running at between 10% (Japan) and 38% (Poland).
It is higher amongst under-35s and people who consume news the most. In every country, ad blocking becomes slightly less common with each increase in age bracket.
In the UK around of a fifth of web users use an ad blocker.
Reuters goes further, suggesting that the vast majority of those who have ever downloaded a blocker are using them regularly. Once downloaded people rarely go back.
Volume and distraction, privacy concerns, download speeds, data usage and battery life, are all reasons cited.
Web pages are cleaner and load faster without adverts, but publishers already squeezed in the shift from print to digital, lose much needed revenue.
What makes this extraordinary is that the technology didn't exist 18 months ago.
I've been running the Chrome desktop AdBlock plugin on my Chrome desktop browser for the last four weeks. It's blocked almost 12,000 ads according to the analytics. It’s used by 50 million people.
You can do the calculations yourself and quickly realise the scale of this issue for advertisers. Ad blockers are blocking millions of ad impressions every day.
Publishers such as Forbes have started to block ad blockers. An interstitial page invites you to turn off your ad block if you visit the site.
Publishers in Sweden, one of the worst affected countries by ad blockers (27%), plan to collectively block all content to those using ad blockers – offering a choice instead of one-off payments.
Ad blockers for their part need to generate revenue and so are white labelling ads or running their own ads.
It's an extraordinary situation in which no one wins. Publishers need smarter ways to generate revenue online that don't alienate their customers.