Ad blocking is an issue that’s not going away. Further evidence of this is that today the carrier Three, in the UK and Italy, announced that it was going to roll out ad blocking “at the network level.”
This is a much more serious and comprehensive threat to mobile advertising than individual apps that may block ads on the mobile web. Although end users could disable it, network-level blocking has the capability to disrupt all ads, whether in apps or on the mobile web, and presumably in all ad formats, including video.
Three says its objective is not to block all ads, just poor-quality or malicious ads. The operator announced that it will be working with Israeli startup Shine to do so. Shine presents itself as an anti-virus provider for mobile users. Yet it’s also an unapologetic ad blocker. On the company’s website it reads, “Ad blocking is a consumer right. Full stop.”
Here’s the carrier’s statement regarding its motives and objectives in adopting ad blocking:
That customers should not pay data charges to receive adverts. These should be costs borne by the advertiser.
That customers’ privacy and security must be fully protected. Some advertisers use mobile ads to extract and exploit data about customers without their knowledge or consent.
That customers should be entitled to receive advertising that is relevant and interesting to them, and not to have their data experience in mobile degraded by excessive, intrusive, unwanted or irrelevant adverts.
Three, which operates throughout Europe and in parts of Asia, is part of Hong Kong-based Hutchison Holdings. Hutchison is controlled by Li Ka-shing. The Chinese billionaire is also an investor in Shine.
In the announcement today, the IAB’s Randall Rothenberg doesn’t see consumer protection, he sees a self-interested conspiracy.
Both the carrier and the ad-block extortionist are owned by Hong Kong billionaire Li Ka-shing. #iab #itsallaboutthe$ https://t.co/kvheUW5y9A — Randall Rothenberg (@r2rothenberg) February 19, 2016
While the program is starting with Three UK and Three Italia, it will likely roll out to the other countries the carrier services, including Austria, Ireland, Sweden, Denmark, Hong Kong and Indonesia. Three’s subscribers in Europe represent roughly 30 million users.
The IAB considers ad blocking an existential threat to publishers and marketers. Survey data show that Millennials are the most active users of ad blocking. There are different and conflicting statements about how damaging ad blocking has been to date.
Three hasn’t said how it will implement ad blocking or whether it will be seeking to generate revenue from the move. Mobile carriers, however, have largely been shut out of the mobile ad revenue stream — notwithstanding Verizon’s acquisition of AOL.
Other carriers could see Three’s move as a model and seek to insert themselves as gatekeepers between users, publishers and advertisers as a way to get in on the action. This is precisely what IAB fears and why it refers to ad blockers and their supporters as “extortionists.”
If Three uses ad blocking as a marketing tool to capture subscribers in Europe or Asia, other carriers may feel compelled to offer something similar on a competitive basis. That will remain to be seen, however.
Google’s AMP initiative is in part an effort to address some of the root causes and consumer concerns behind ad blocking. Indeed, dealing with the problems that make people inclined to block ads is much closer to a solution than name-calling.
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