Advertising is one of the main business models on the Internet: it scales very well and enables websites to charge micro-transactions to their visitors without the fees that apply to regular online payments, e.g. fixed fees of about $0.30 for Paypal and Stripe.
Publishers have the incentive to display more ads, in more intrusive formats, so that visitors cannot just ignore them. For example, they introduced pop-up ads in the early 2000's.
Visitors got annoyed and designed workarounds to skip those ads. A competition had begun between publishers and visitors, in a $100B+ market.
I first describe the different types of ad blockers and how they work. Some projects even try to sabotage the ad system!
Then, I discuss the available options for ad companies to fight blocking: technology, law or redefining the content itself.
Lastly, I review different mechanisms that will regulate the ad market and shape the future of that industry.
Overview of ad blocking software
Detecting and filtering ads in webpages can be done when content is in transit (e.g. ISP, home router) or directly on the end-user device (e.g. computer, smartphone).
Browser ad blockers
Adblock Plus, uBlock are extensions for browsers. They use filter lists, such as the community-managed EasyList that is installed by default. Filter lists are lists of patterns for web resources. When a page is loaded, the address (URL, domain) and display characteristics (DOM structure, CSS classes) of each resource are checked against filter lists.
They are compatible with the most popular desktop browsers, as well as some mobile browsers, such as Firefox for Android.
Network ad blockers
Ads can also be filtered at the network level, by blocking a list of domain names, by using a proxy or simply at the DNS-resolution, hostfile level. Such ad blockers can be installed on the user machine, or on its router.
For example, on Android, hostfile installer AdAway cleans many ads at the system level, using several domain lists).
At the router level, Pi-Hole, a software that is to be installed on any Linux machine (including the Raspberry Pi, hence the name) and Privoxy, a web proxy, can filter some ads before they reach computers on the network.
A French ISP, Free, tested blocking ads for their customers in 2013. They mangled the DNS server configured by default for end users. This has been abandoned since, some groups condemning the move as a bold attack against Google in the context of ongoing peering agreements and a first step towards censorship (archive if the site is down).
Combining both at home can be a good idea
Domain-name filtering has the advantage that it can be set up at a network level, ensuring that all requests are blocked on all devices, for all applications, without any further configuration required. However, it lacks the precision of browser-based blockers, especially on domains that use HTTPS and that serve useful content (e.g. https://domain/ham) as well as unwanted one (e.g. https://domain/spam). The proxy only sees https://domain/ and cannot filter by full path, DOM structure or CSS rules. Also, network ad blockers are less convenient when a temporary whitelisting is needed.
In a nutshell, using two adblockers is nice if the network-level filter is tuned to have a minimum of false positives. Browsers can finish the filtering job with their own blocker (filering DOM/CSS and the websites that need to be occasionnaly whitelisted). The presence of the network adblocker ensures other ressources on the network where adblockers are not easily installed (e.g. smartphones & rooting) have also much less ads.
Advertising and tracking sabotage
Simply hiding the ads is only one way to fight an Internet driven by advertising platforms. Sabotaging the system is even more entertaining in the eyes of the developers of AdNauseam, a web extension that not only hides ads, but also quietly click[s] on every blocked ad, registering a visit on ad networks' databases. This is devilishly genius. My personal piece of advice is to use AdNauseam on the websites you want to support, so that they benefit from the click fraud. For other websites, use a plain adblock. This extension has been kicked out of the Chrome Web Store but you can still install it manually. It is also available on Firefox and Opera.
Automating click-fraud has been at the center of Google Will Eat Itself, now defunct, artistic project:
We generate money by serving Google text advertisements on a network of hidden Websites. With this money we automatically buy Google shares. We buy Google via their own advertisement! Google eats itself - but in the end "we" own it!
By establishing this autocannibalistic model we deconstruct the new global advertisement mechanisms by rendering them into a surreal click-based economic model.
Counterattacks from advertisers
Obfuscation
A counterattack from a website would be to obfuscate its assets. The homepage /index.html would show a useful image /m33te.jpg and an ad /fdc65.jpg, with the paths changing regularly. In the scenario where DOM/CSS filters would not be effective either (ads and content mixed in a feed for example, with same presentation), there would be no easy way to block the ad. It has been the approach of Facebook. A game of cat and mouse is happening between Facebook and the Easylist community. List maintainers have to tailor very sophisticated filter rules (by DOM structure and CSS properties) that break as soon as Facebook decides so.
But few websites follow this strategy. Facebook can do it because it is a walled garden having its own advertising platform and vast resources to engage in an obfuscation battle. The majority of websites in general rely on third-party advertising networks, as it is much easier to implement.
Fortunately, third-party ad networks are straightforward to filter and the community maintaining the lists it has grown to a point you almost never see an ad anymore when you surf the web.
Adblock walls
An adblock wall is a technique to detect if ads have been correctly displayed on a website. If they have not, it denies access and displays instead a message asking the user to disable its adblocker (at least for the given website). This technique has mixed results, as described by a PageFair report from 2017:
90% of adblock users surveyed have encountered an adblock wall.
74% of these users say that they leave websites when they encounter such an adblock wall.When faced with an adblock wall, older internet users and men are more likely to leave than perform the steps required to disable their adblocker.
Verdict: Adblock walls are ineffective at motivating most adblock users to disable their adblock software, even temporarily. Unless the website in question has valued content that cannot be obtained elsewhere, an adblock wall is likely to be ineffective at combating adblock usage at any significant rate.
The main difficulty of web advertisers is that they do not control the end user platform. Adblock walls can be circumvented by tools such as Anti Adblock Killer or even the more general-purpose tool NoScript, that disables JavaScript execution.
Court
One of the remaining ways to fight adblockers has been to sue the only for-profit adblocking company in the sector, Eyeo GmbH, editor of Adblock Plus. There have been many decisions between Eyeo and Springer, over several years. The last one, handed down by the German Supreme Court, ruled in favor of Eyeo:
Today’s Supreme Court ruling confirms -- just as the regional courts in Munich and Hamburg stated previously -- that people have the right in Germany to block ads. This case had already been tried in the Cologne Regional Court, then in the Regional Court of Appeals, also in Cologne – with similar results. It also confirms that Adblock Plus can use a whitelist to allow certain acceptable ads through. Today’s Supreme Court decision puts an end to publisher Axel Springer’s claim that they be treated differently for the whitelisting portion of Adblock Plus’ business model.
Importantly, the judges ruled that the use of ad-blocking software and the employment of a whitelist that allows non-intrusive advertising is legitimate. Specifically, the judges decided that Adblock Plus does not breach the law §4a UWG (unfair competition), because it does not enforce aggressive business practices.
This final decision only deals with Germany, but establishes a very significant legal precedent.
Ad is the content itself: product placement
If displaying ads is not enough profitable because of blockers or platform fees, publishers still have the option to do product placement. The practice is common on blogs and social media, where you can pay influencers to get a product featured, or fake news distributed.
Fortunately, it has a very limited impact on real journalism, as it follows a code of ethics. But in general, product placement on a website is possible. This marks a clear difference between the Internet as a media on one side, and TV and radio on the other side. In Europe at least, product placement is forbidden on TV and radio. Ads and content have to be clearly separated (e.g. for radio in France: Décret n°87-239 du 6 avril 1987, Article 8).
Let's hope the financial pressure of ad blockers will not jeopardize the rule of separation between content and ads, as it contributes a lot to media quality.
Towards better ads on the web
Acceptable ads / Adblock Plus
Completely blocking ads is not really helpful for the web economy. Adblock Plus has introduced the concept of Acceptable Ads program a few years ago. Ads that follow a strict set of rules (defined by ABP) get whitelisted for Adblock Plus users that have not disabled this feature. Given the market share of Adblock Plus, this put an incentive on advertisers to use ads formats that are more respectful to the users, see e.g. Carbon Ads. Ads in general get better over time.
Despite the nice intentions behind this program, this move has lead to controversy. The caveat is that even if Eyeo whitelists the majority of ads for free, it asked money to the biggest ad networks (including Google). That looked a bit like extortion.
Coalition for Better Ads / Ad companies
The rise of ad blockers has gathered many actors to define better standards for advertising: the Coalition for Better Ads. Where the Acceptable Ads program (from Adblock Plus) has strict rules, Coalition for Better Ads guidelines are much more lenient. This puts incentives at different levels of the ad market, which is a good thing.
Recently, Google introduced an adblocker in Chrome itself, following the CBA rules. At first glance, this is a counter-intuitive move. Why would Google, an advertising company, give some income up? All things considered, it is quite brilliant in my opinion. If the worst ads get blocked, people have less incentive to install a full fledged adblocker and Google saves its business model.
I am looking forward to a big antitrust legal battle when Google will have used Chrome to block all ads except its own ones. My 2-cents piece of advice is not to rely on Chrome's built-in adblocker.
Innovative business models / Brave
Brave has its own approach to reconcile readers with advertising. Its main product, a browser, replaces ads with respectful ones, which means tracking-free and lightweight. Furthermore, it shares 15% the ad revenue with the user.
Users in the Brave ecosystem can gracefully migrate to an ad-free experience with the micro-payment system based on Basic Attention Tokens, that shares similarities with that of Flattr (now tied to Adblock Plus) or Tipeee. It's innovative. Brave should definitely stay in your radar.
To conclude, the war between ad companies and ad blockers is fascinating to analyze. I cannot wait to know what clever moves those actors are going to do next.