There has been much more press in the past week about ad blocking as Google's influence is being questioned as it rolls out ad blocking as a feature built into Google's dominant Chrome web browser.
As much as it can make us all uncomfortable, the industry coalition (called the CBA) is working to improve ad experiences. The CBA serves an important function as it includes many stakeholders at the table and its ad experience research was solid regardless of how it was sourced.
The rub is Google itself said its ad blocker will only impact 1% of the top 100,000 publishers. Not surprisingly, many saw this as good news but obviously at that rate it won't reduce installations of ad blocking software (yet). Even the largest ad blockers celebrated this point.
Standby for the missing/real Google story, though:
Most ad blocking in the western world happens within 2 ad blockers - both pieces of software block most ads and then leverage a scheme in which they are paid $$$ to whitelist certain ads which they have deemed “acceptable.”
Most ad blocking in the western world happens within 2 ad blockers - both pieces of software block most ads and then leverage a scheme in which they are paid $$$ to whitelist certain ads which they have deemed “acceptable.”
And importantly both are considered inferior in protecting tracking, security, privacy. Ppl would be much better off installing extensions from @EFF (@PrivacyBadger), @disconnectme, @brave, @firefox, etc than the two major ad blockers which are most often used in western world.
this scheme to whitelist ads in ad blockers for $ started in 2011. The scheme tempted Google to play ball in June 2013. G since admitted to signing on, paying into the scheme (scheme directly funds ad blocking software companies). So G's deal was mutually beneficial w/ blockers.
the deal benefitted Google in that 1) G's ads would no longer be blocked like rest of the web and 2) the formats for "acceptable ads" allowed for most of G's revenue and didn't impact G's trackers (note: G is by far the biggest tracker/collector of use data across the US web).
the deal benefited ad blockers in that it would provide them with $$$ from Google to pay for developers, engineers, marketing, legal defense. it was also a market maker for whitelisting and provided further leverage over G as their business grew. Likely too much in hindsight.
In August 2013, Business Insider reported Google was saving close to $900 million in revenue by paying off Ad block Plus to show its ads. Makes sense. If you turn off the whitelisting, literally every Google search ad goes away. That's most of Google's business at risk.
If you model for financial impact from the growth in ad blocking software since 2013, the simple models show Google is now saving many, many billions of dollars from this scheme. It also means a single ad blocking company likely has a "kill switch" on billions in G's ad revenue.
Pausing to remind everyone, Google along with Facebook controls 85% of the global digital ad market outside of China. Google also controls 60% of web browsing with Chrome. Google also controls nearly all search including buying out search on Mozilla Firefox and Apple Safari.
In other words, if you’re going to search for an ad blocker, install an ad blocker, deliver an ad through or be blocked by an ad blocker, or distribute your ad blocker, your $$$ money likely flows to Google. Quite a concept, eh. Rockefeller would be impressed.
Thought experiment: if the two major ad blockers turned off Google’s whitelisting, what would happen? Google would have to kick out their extensions, walk into legal disputes, promote better solutions. This would likely help real publishers.
Google had many ways to play their "ad blocking problem” back in 2013. The noble one would've been to stand for consumer experience, privacy/security like Apple, Mozilla. But they opted to pay off the ad blockers, something even Facebook and all reputable publishers refuse to do.
And yes Google has revenues impacted across the web by ad blocking and on YouTube but for most of the time, it likely hasn’t been worth the risk to do something more aggressive around ad blocking. G needed to protect its core business: search ads.
Some questions reporters need to ask: (1) How much revenue did the two major ad blockers make from whitelisting scheme in 2014-2017? (2) and how much and what %of this revenue does Google provide to them directly or indirectly?
(3) How much $$$ if any do the major ad blockers spend per year with Google to market and promote their software? (4) What % of ad revenue from whitelisting scheme does Google pay to the ad blocking companies?
(5) What % of these whitelisting deals are at comparable or better terms than Google's own deal into the scheme? (6) can anyone else compete with Google’s sweetheart deal for whitelisting? Scheme advertises 30% which of course Google doesn't pay anything close too that.
(7) Does G have a most favored nations clause in its deal? (8) Who acquired the second largest adblocking software company, AdBlock, on October 1, 2015? We still don't know. Timing was entirely suspicious. businessinsider.com/adblock-gets-s…
(9) What were the significant terms and motivations for the acquisition of Ad Block by the mystery buyer? (important considering it shifted dynamics for legal defense by Ad Block Plus owner).
I’ve got more. I know this one is complex but it’s critical to understand as industry is torn between two dominant worlds: an entirely closed Facebook platform world and a mostly Google-controlled stack. Ultimately industry needs the open web and Google wants to control open web.
Google’s stack more and more is a function of Google-controlled OS + Google-controlled browser + Google-controlled AMP + Google-controlled ad tech stack in which Google’s tracking and data collection runs from end to end through all of it.
Happy President’s Day </end thread>
