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Rise of Ad-Blocking Software Threatens Online Revenue

Posted by Steve Schram on June 01, 2016 at 10:28 AM

Originally published on May 30, 2016 on The New York Times by Mark Scott.

Many of the world’s largest Internet companies, like Google and Facebook, rely heavily on advertising to finance their online empires.

But that business model is increasingly coming under threat, with one in five smartphone users, or almost 420 million people worldwide, blocking advertising when browsing the web on cellphones. That represents a 90 percent annual increase, according to a new report from PageFair, a start-up that helps to recoup some of this lost advertising revenue, and Priori Data, a company that tracks smartphone applications.

The use of ad-blocking software has divided the online world. Supporters say it allows people to get better access to content without having to suffer through abrasive ads. Opponents, particularly companies that rely on advertising, say blocking ads violates the implicit contract that people agree to when viewing online material, much of which is paid for by digital advertising.

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