The latest update to Apple’s mobile operating system, iOS9, will make it easier for users to enable “content blocking,” or apps that remove advertising and ad tracking when users surf the web in the default Safari web browser. Apple believes this will lead to faster load times and a more secure experience for users. But blocking ads will also mean a loss of revenue for publishers and a loss of reach for advertisers.
Until recently, ad blocking technology was widely available but not widely adopted. A recent study by Pagefair and Adobe found that the use of this technology was on the rise, increasing 41% globally year-over-year, with 16% of the US online population blocking ads in Q2 2015. The study showed that mobile is lagging slightly behind, with 38% of all web browsing being conducted on mobile devices, and only 1.6% of mobile users blocking ads. Apple’s decision to make it easy to employ content blocking will undoubtedly lead to a sharp rise in those numbers.
Some have argued this technology is akin to a DVR making it easy to skip television ads. However, television viewers still see ads when watching in real time, and get at least a glimpse of ad messaging when fast forwarding through commercials. Ad blocking technology goes further by hijacking the content of a site, removing content used to monetize the site, and with it the opportunity for advertisers to reach an audience and publishers to make money.
On-site advertising may not be the only content blocked by these iOS extensions. Tracking tools employed by marketers and publishers to measure success and make optimizations – like Google Analytics, Optimely, and Adobe Site Catalyst – will be affected. These tools currently give publishers vital information to make business decisions and improve user experiences.
As of now, Apple is only making content blocking available on the mobile web. Also, it should be noted that ads displayed in native applications downloaded through the App store won’t be affected. In other words, Apple’s own iAds solution for delivering ads to those mobile applications will gain in importance. Because of course Apple profits when ads are displayed through iAds, but it doesn’t profit in the same way from ads being shown on the competitor-dominated mobile web.
The rise of ad and content blockers on the web poses serious problems to digital publishers. Monetizing content is vital to keeping the web largely free and open. Advertising is the transaction that happens between a consumer and a publisher that keeps content free. The loss of this transaction means publishers will need to find other ways to make money.
It is possible that our industry is coming to the end of an era where banner advertisements, pop-ups, interstitials and other intrusive ads dominate the web. In its place could be a greater reliance on Search Engine Marketing, Facebook advertising, streaming audio, in-app mobile and native ads. This shift would likely further consolidate revenue and influence among a small number of companies (Facebook, Google, Spotify, AOL, etc.) that already have large reach, deep pockets and well-known brands.
For publishers, options like paywalls, native ads, affiliate schemes, native apps, merchandising and premium content subscriptions could help them monetize. Unfortunately, all are options that work better for larger publishers than smaller ones. Online users have shown a reluctance to pay for content directly through subscription and want free content despite a growing resistance to ads.
While it is doubtful that one hundred percent of iOS users will install content blocking extensions, any sizeable percentage could have long-lasting effects. But it is easy to imagine a day when corporations and universities, using arguments about privacy and security, make ad blocking mandatory on their networked devices. This may be the start of a major shift in how online content is funded and marketers reach audiences online, and is a trend we’ll be watching closely as it unfolds.
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