Facebook's latest attempt to make its newsfeed and the ads that come along with it more essential to users and, hence, valuable to advertisers saw it announce a new policy last week regarding ad blocking and serving of ads. Facebook will continue to show ads to users using ad blocking software on desktop while at the same time giving users more control over the kind of ads they want to block or watch.
What is a little surprising is the sheer effort that Facebook is making to battle the ad blocking community just now. There is no doubt that ad blockers are a major concern for all digital advertisers and platforms right now, with reports suggesting that nearly 200 million users worldwide use ad blockers on the desktop and an even larger number using it on the smartphone.
The point to be noted here is that desktop ad revenue forms a very small portion of the company's overall advertising revenue. As per the latest quarter results, nearly 84 per cent of the company's ad revenues come from mobile, a figure expected to further increase in the future. And yet, the Facebook ad block announcement was specifically for desktops.
The most logical answer to this is the fact that Facebook attracts most of the mobile traffic come from its app, which, for now at least, is mostly immune to ad blocking. And the approx 16 per cent of revenue that it gets from desktop advertising is hardly loose change as this translates to nearly $ 992 million as per latest quarter results.
Facebook, itself, in a recent filing with the Securities and Exchange Commission, claimed that ad blockers "could adversely" affect the company's financial results.
"Technologies have been developed, and will likely continue to be developed, that can block the display of our ads, particularly advertising displayed on personal computers. We generate substantially all of our revenue from advertising, including revenue resulting from the display of ads on personal computers. Revenue generated from the display of ads on personal computers has been impacted by these technologies from time to time. As a result, these technologies have had an adverse effect on our financial results and, if such technologies continue to proliferate, in particular with respect to mobile platforms, our future financial results may be harmed," wrote the company in its statement.
Perhaps, a deeper reason behind this new found zest for taking on ad blocking could lie in Facebook's long-held dream of becoming the premier content destination on the internet. To this end, it has gone out of its way to woo content creators and publishers, created platforms like Instant Articles and is even helping out publishers and creators with monetization on quite generous terms (or so we have heard).
Under Instant Articles, Facebook hosts publisher content with the promise of faster page uploads and better user experience. For most publishers, who might lack the technical know-how in these things, it is an easy choice to make. Add to this, the promise that their content when hosted on Facebook's native publishing platform will no longer be subject to ad blockers and one can see the obvious allure of it to publishers who are highly dependent on Facebook for referral traffic.
Of course, companies like AdBlock Plus were quick with a repartee, with the company's Ben Williams calling Facebook's move "anti-user" in a blog post last week. In a subsequent blog post titled, "Trampling on users’ free will is not sustainable -- even if you're Facebook", he writes, "We clearly feel like giving users control of their internet experience is better than taking it away, and it’s disheartening that a company like Facebook would abuse everyone’s experience of their site by forcing that experience into a one-size-fits-all, see-the-ads-or-else tube. The internet just doesn’t work that way. At least it shouldn’t."
AdBlock Plus has already introduced a workaround, which further prompted Facebook to come up with another way to circumvent this workaround, which AdBlock Plus says users can themselves circumvent with a new workaround introduced by the company. Of course, this has further caused the engineers at Facebook to work at record speed with yet another way to block ads on Facebook.
"Ad blocking technologies work on certain defined principles of detecting where ads and tracking codes are placed. To detect auto blockers is not a very difficult task. In fact, at iProspect we have developed iUnBlock for our publisher partners that detects ad blockers and restricts content to the user basis this and asks them to disable the same to access the full content," says Vivek Bhargava, CEO at iProspect India. It is an approach being favoured by quite a few online publishers.
At the time of writing, the game of one-upmanship showed no signs of letting off.
"It's a simple cat-and-mouse game that we have seen too often. Hackers jailbreak iOS, Apple patches them. Virus makers find new vulnerabilities and anti-virus companies patch them. I see a similar trend in the ad blocking segment," opined Gautamm Mehra, VP (Account Planning & Innovation) at iProspect India.