SAN FRANCISCO — Apple today reported that adoption of the latest update to its operating system was the fastest in the company’s history, with more than 50 percent of devices using iOS9 just three days after its release. But while this is good news for Apple (whose new phones hit stores Friday), the new operating system could have a major impact on the way that mobile publishers make money.
Among the updates was the ability to enable content blockers, which are apps that can block ads, in addition to invisible tracking scripts, during mobile browsing. They also decrease the time it takes to load Web sites, and thus potentially save consumers time and money in data charges.
According to Apple, content blocking was a popular Safari extension on Macs, so the company wanted to give mobile customers the option to block content in Safari for an improved mobile browsing experience.
Ad-blocking apps rose to the top of the paid charts in the app store. Crystal, at 99 cents, was the top-paid app overall on Monday, and Purify, at $3.99, was in the number-four spot.
A competing app, called Peace, was taken down by founder Marco Arment on Friday. He said in a blog post that the hurt it could potentially cause didn’t feel good. “If we’re going to effect positive change overall,” he wrote, “a more nuanced, complex approach is required than what I can bring in a simple iOS app.”
Ad-blockers have already been in use on desktop browsers — estimates put usage at 16 percent of the U.S. population — but the ability to use them on mobile devices has accelerated the issue, said Digital Content Next chief executive officer Jason Kint.
“The trend has been going up in a linear fashion,” Kint said, “but the one good part about the mobile launch is that it’s forcing everyone to face what’s going on.”
More consumers are trading their desktops for a mobile screen. According to research joint-published by PageFair and Adobe in August, mobile accounted for 38 percent of all Web browsing, and according to research from Google, 53 percent of those who shopped online during the 2014 holiday season used a smartphone or a tablet. A 2015 report from Oxford named the smartphone as the defining device for digital news, with news access from a smartphone growing particularly in the U.S., U.K. and Japan.
Consumers might have more to gain from installing a mobile ad-blocker than they would on a desktop, said Forrester senior analyst Jennifer Wise, due to the especially poor experience they get with mobile ads compared to those on a desktop browser.
The reasons for concern are obvious. PageFair estimated that the global cost of ad-blocking was expected to be as much as $41.4 billion by 2016. In addition to threatening the livelihood of publishers who monetize through ads and ad tech who make money from placing ads, this could mean bad news, and higher costs, for consumers who are used to accessing a wide range of free, high-quality content.
So what’s the solution? Although “there’s no magic bullet,” Kint said, experts seem to agree that a focus on the consumer experience is key. “Consumers,” he said, “are speaking up with software.”
“It clutters the screen and makes content load times unbearable,” Wise said of the ads. “Publishers and ad tech have to act quickly to evaluate and improve their users’ ad experience.” Wise recommended that advertisers create ads that are less interruptive and more relevant, and that publishers be mindful of the ad units they offer.
Although customization is a key component in mobile advertising, there is also discomfort among consumers about sharing personal information. PageFair found that misuse of personal information was the primary reason to enable ad-blocking.
“There has been billions invested in ad technologies to follow consumers all around the Web,” Kint said. “Consumer privacy and user experience haven’t been given proper consideration. The industry needs to clean up the user experience and provide more transparency and controls for consumers.”
While ad-blocking software is made to detect advertisements, it’s less able to detect advertising content that takes the shape of editorial — referred to as “native advertising” or “sponsored content,” which has been adopted by publishers including Yahoo! and The New York Times as well as many consumer fashion magazines. According to research from eMarketer, native ad spending on mobile was growing, partly because of the increased engagement, but also because its format of blending into the editorial that surrounds it lends itself to the mobile browsing experience. But native advertising, Kint said, is just another tool, but it won’t solve the issue.
Rather, he said, publishers are encouraged to diversify revenue streams or offer options beyond advertising. If consumers are responding to too many ads, an optional subscription service that minimizes them — like those seen in the worlds of music (Pandora), TV (Hulu) and movies (Netflix) — could follow suit. Similarly, rather than browsing news on Safari, there could be an increase in accessing mobile content via an app, which would not be susceptible to ad-blockers.
Somewhat conveniently, Apple News, a news aggregating app, launched with the new iOS release, but Kint sees that less of an intentional plot and more as a “beneficial coincidence.” It’s also an example of giving the consumer a more enjoyable experience.
“Apple has been one of the most consumer-focused brands and companies we’ve seen in our generation,” said Kint, citing Apple chief executive officer Tim Cook’s stance as an advocate for consumer trust and privacy. The Apple News, he said, embraces the consumer experience and “is consistent with their DNA.”
Ultimately, the popularity of mobile ad-blocker software stands to improve the mobile browsing experience, but for this to work, Wise said, the good ads need to stay.
“At the end of the day,” Kint said, “there’s a necessity that content needs to be paid for, and every publisher should be thinking about new ways to pay for that content. We’ll need the full support of advertisers, ad technologies and other third parties to win back these consumers — or evolve the models in a way that works.”