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Ad blockers: A solution or a problem?

Robert L. Mitchell | Jan. 16, 2014
It's a cause. It's a curse. It's just business. Ad blockers take a bite out of the $20 billion digital advertising pie.

Furchgott-Roth thinks that's a battle that the ad blockers would have a hard time winning. "The economic model between sites and advertisers is so powerful that they will figure out some way to allow this to continue." And it won't be just the small startups like ClarityRay and PageFair, each with about $500,000 in backing, that the ad blocking vendors will need to worry about. Ultimately, he says, "Google has more money to invest in this than do the ad blocking companies."

For some smaller publishers catering to more tech-savvy audiences, dealing with the effects of ad blocking is fast becoming a matter of survival. Since appeals to users haven't worked at Geekzone, Freitas is trying to deal with the declining ad revenue problem by coming up with other ways to generate income. For example, he has developed a sponsored tech blog where community members receive early releases of new mobile phones in exchange for writing about their experiences in a blog. "They can write anything they want, and Telecom New Zealand pays for that," he says.

With display ad revenues declining and paid contributions a tiny fraction of revenues, such models are the key to recovery. "The big takeaway for publishers is that you have to have a diversified income stream to survive," he says.

 

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