The effect of adblockers on Internet business models
Does the arrival of adblockers threaten the Internet as we know it?
The question is crucial, because the increasing use of adblockers is forcing service and content providers funded through advertising to find new sources of funding, including from consumers.
Explosion of Internet data and advertising revenue
Between 2004 and 2014, the number of Internet sites was multiplied by 18.7 and the number of users by only 3.2. The annual volume of data exchanged over the Internet is skyrocketing; it’s expected to exceed a zettabit (1021 bits) by late 2016 and reach 3 zettabits by the end of 2020.
Three categories of services and content are associated with different modes of financing: merchant sites, which generate revenue by acting as intermediary between buyers and sellers; premium services and content funded by Internet users (subscriptions, one-off media purchases, etc.); and free services and content funded through the sale of advertising space to advertisers.
Online advertising has developed particularly strongly, as shown by the growth in the sector's revenue (up 13.4 percent in 2015), which is expected to reach $180 billion in 2016. Web giants, meanwhile, are able to earn significant revenue from consumer purchases. Netflix, responsible for 37 percent of the downstream traffic in the United States, earned $1.67 billion in subscriptions in the fourth quarter of 2015.
This growth in the services and content market (free and paid) has been supported by continuous progress, enabling the exchange of ever-increasing volumes of data. At the same time, the increased amount and improved quality of content increases the value of the service offered by Internet service providers (ISPs).