The Amount of Money Lost to Ad-Blocking Is Skyrocketing
Are you annoyed by online pop-up ads or those video commercials that automatically start playing when you visit a new Web page? Worried about advertisers collecting your personal information online? You’re not alone. In the perpetual cat and mouse game between marketers and Internet users, the utilization of ad-blocking software by Web surfers is growing rapidly — and it’s costing advertisers billions.
Ad-blocking technology was employed by 45 million active users during the second quarter of 2015, a new report by PageFair and Adobe found. This represents 16 percent of the U.S. online population. In the past year, the number of users blocking ads grew by 48 percent.
In 2014, ad-blocking in the U.S. cost an estimated $5.8 billion in lost advertising revenue. That figure is expected to jump to $10.7 billion in 2015 and $20.3 billion in 2016 as more users adopt the practice. The new version of Apple’s mobile operating system coming this fall is expected to make the problem worse, since it will allow iPhone users to block ads in Safari with a simple app.
In addition to lost revenue, ad-blocking skews the demographics of the online audience. Websites that cater to younger users — a demographic advertisers are eager to target — are the ones most significantly affected by ad-blocking.
Related: The Future of Advertising: Everything, Everywhere, All the Time
A survey in the PageFair/Adobe report found that the main reason individuals block ads is a concern about advertisers mishandling personal data.
Advertisers have a long way to go when it comes to trust. An article in AdAge argues that marketers should be more transparent about the ways they use the information they collect. It recommends giving users more control of their personal data, the ability to decide how much information to share and the choice to opt-out at any time.
Trust isn’t the only issue, though. The appeal of ad-blocking is growing as “malvertising” attacks become more common. Last month, Yahoo’s ad network was targeted for seven days by hackers who sent out corrupt bits of code through Flash-based ads to visitors on Yahoo’s popular sites. Some users were redirected to sites that paid the hackers for traffic, while others had their computers locked for ransom.
Top Reads from The Fiscal Times:
- Bush Looks to Make Up for Past Blunders on Iraq Policy
- Oil Sector Insiders Signal It’s Time to Buy
- How a Soaring Dollar Forced China to Devalue Its Currency
Quote of the Day: A Big Hurdle for the Tax Cuts
“He goes in and campaigns on an issue, and the challenge is he then talks about executing drug dealers. Why do you think the press is going to cover the tax cuts if you’ve given them the much more exciting issue?”
-- Grover Norquist, president of tax-cutting advocacy group Americans for Tax Reform, on President Trump’s failure to sell the tax law.
The Obamacare Mandate That Could Produce $12 Billion in Fines in 2018
Republicans effectively eliminated the individual Obamacare mandate in the tax package signed late last year. Although the new regulation reducing the mandate penalty to zero doesn’t take effect until 2019, President Trump has cited the rule change as a victory over the health law so many conservatives oppose. “Essentially, we are getting rid of Obamacare. Some people would say, essentially, we have gotten rid of it," Trump told a crowd in Michigan two weeks ago.
However, many parts of the Affordable Care Act are still in effect and will continue to operate even after the individual mandate is eliminated in 2019.
In particular, the employer mandate, which requires companies with more than 50 employees to offer health benefits or face fine of roughly $2,000 per worker, will continue to play a significant role in the Obamacare system. The Congressional Budget Office estimates that the mandate will produce more than $12 billion in fines in 2018 alone.
Some conservative groups are pushing lawmakers to stop enforcing the employer mandate, but the IRS is still working to enforce the law. According to The New York Times Monday, the IRS is sending out notices to more than 30,000 businesses that have failed to comply.
Chart of the Day: It’s Still the Economy, Stupid
Security may be the top policy issue for Republican voters, but the economy is the top concern for Democrats, independents and voters overall, according to Morning Consult’s latest polling on the midterm elections. Health care is third on the list, followed by “seniors’ issues.” The results are based on surveys with more than 275,000 registered U.S. voters from February 1 to April 30.
Number of the Day: $13 Billion
An analysis by Bloomberg finds that the roughly 180 companies in the S&P 500 that have reported earnings for the first three months of the year saved almost $13 billion thanks to the corporate tax cut enacted late last year. Those companies’ effective tax rate dropped by more than 6 percentage points on average. About a third of the tax savings went to 44 financial firms.
How a Florida Doctor with Social Ties to Trump Delayed a $16B Billion VA Project
A West Palm Beach doctor who is friends with Ike Perlmutter, the chairman of Marvel Entertainment and an informal adviser to President Trump on veterans’ issues, has held up “the biggest health information technology project in history — the transformation of the VA’s digital records system,” Politico’s Arthur Allen reports. Dr. Bruce Moskowitz “objected to the $16 billion Department of Veterans Affairs project because he doesn’t like the Cerner Corp. software he uses at two Florida hospitals, according to four former and current senior VA officials. Cerner technology is a cornerstone of the VA project. … Moskowitz’s concerns effectively delayed the agreement for months, the sources said.” Read the full story.