Wake up, the ad blocking bubble has burst

By Oliver Smith 24 February 2017

An online nightmare that never came.

Back at the end of 2015 a new digital menace reared its head, terrifying publishers across the globe.

Ad blocking was described as an “existential threat” to all the websites you know and love by The New York Times, a threat directly triggered by Apple’s decision to allow ad blocking on iPhones.

We suggested that the ad blocking tidal wave was poised to be a “huge problem for publishers” and wondered if it might even destroy the web’s advertising-driven business model.

But 18 months on, now the dust has settled, reality is falling far short of the hype.

The ad-blocking bubble

Just 22% of Brits actually use ad blocking software on their smartphones today, the Internet Advertising Bureau revealed this week.

Far from an explosion in interest, that 22% is actually flat year-on-year

“The continued rise in ad blocking that some predicted simply hasn’t materialised,” said the Internet Advertising Bureau’s UK CEO Jon Mew.

At the same time ad blocking apps have plummeted in Apple’s App Store charts, with none in the UK’s top 150 most-downloaded free apps anymore.

Mew blames the flat growth of ad blocking on websites that block content for people who refuse to view the ads, but that’s not the whole story.

The truth is that ad blocking itself doesn’t have a business model.

Three's UK marketing chief Tom Malleschitz said ad blocking would be great for consumers.

A really bad business

The dozens of ad blocking apps that launched with great fanfare on the App Store in 2015 now wallow at the bottom of download charts, presumably making very little money.

One company called Shine appeared to have a half-decent business model, by charging mobile operators like Three to block ads across their networks.

With great fanfare UK network Three last February said it would block mobile ads for all its users.

“We don’t believe customers should have to pay for data usage driven by mobile ads,” Three’s marketing chief said at the time.

However, by November 2016 that plan had been put on ice and today Shine itself revealed it’s ditching its business to become a mobile advertising network… yes, you read that correctly.

Today there’s no business model for blocking ads, and websites are making it annoying enough for those who do use ad blockers.

If the trend continues, it won’t be long before that 22% starts to fall further.