The market for ads delivered on smartphones may be going away faster than publishers and advertisers hoped or expected.
A new research report from PageFair, an Irish startup that measures and helps publishers manage ad blocking, reports that 419 million people—22% of the world's 1.9 million smartphone owners—are blocking ads on their mobile devices. The report was compiled with the Berlin-based mobile applications intelligence firm Priori Data
Ad-blocking smartphone users are heavily concentrated in Asia, where 36% of users block mobile ads, according to the report. As of March of this year, there were 159 million people with mobile ad-blocking browsers in China, 122 million in India, and 38 million in Indonesia. There were a mere 14 million users with mobile ad-blocking browsers in Europe and North America (there are only 2.3 million in the U.S.). Overall, the report found a 90% growth in mobile ad-blocking during 2015.
Here's the report:
The trend will only increase. The report's writers found 45 different kinds of ad-blocking browsers available, and noted that ASUS had partnered with Adblock Plus to put an ad-blocking browser on 30 million handsets in 2016.
This data is unlikely to please publishers and advertisers looking for new ways to make contact with smartphones users. Mobile ad spending has become an increasingly large chunk of the ad industry. According to eMarketer, mobile was likely to have surpassed desktop in display ad spending in the U.S. last year, increasing from $9.65 billion in 2014 to $14.67 billion in 2015.
Until now, researchers have been fairly sanguine about the threat of mobile ad blocking. In a research note it published last September, UBS said that it didn't think mobile ad blocking would become a mainstream activity, and expected that the impact on actual advertising sales would be small—at most, the bank estimated, the industry might lose $1 billion or so in revenue, or 0.5% of what it pulls in every year.
But PageFair's numbers suggest that ad blockers threaten to kneecap the growing market, something that Tejal Patel, the director of consumer engagement at Microsoft, seemed to acknowledge in April when he said that mobile banner ads would disappear within three or four years at the most.
That pain has already come to the desktop ad world, according to a report PageFair and Adobe released last year. They found that $21.8 billion in advertising was blocked on desktops in 2015, a number that would rise to $41.4 billion in 2016.