With the number of people using ad-blocking software rising fast, the cost of ad-blocking to publishers is also set to jump: according to a new forecast from analytics outfit Optimal, the approximate losses in digital ad revenue will jump from $3.8 billion this year to over $12 billion by 2020.
That equals a fifth of projected digital ad revenues of $50 billion in the latter year, leaving publishers and media companies with $38 billion.
Over the same period, Optimal expects the number of U.S. Web users with ad blocking software to more than double, from 43 million this year to over 100 million four years from now.
While over half of consumers surveyed by Optimal were still unaware that ad-blocking software exists, the company points out that awareness and adoption have been rising fast, meaning there is plenty of potential growth for ad-blockers in years to come.
The report further noted that some publisher responses to ad-blocking may actually make the situation worse.
“Given that ad blockers are often distributed to users without charge, the increase in awareness of ad blocking will be a major adoption driver. It is possible that publisher action to curtail content to ad blocking users might actually further increase consumer awareness of online/mobile ad blocking.”
For good or ill, the publishing industry is gradually organizing itself to take on the threat of ad-blocking. Last month 17 members of the Newspaper Association of America, representing a total of around 1,200 newspapers across the U.S., signed a letter to a startup, Brave, warning that its plans for ad-blocking and replacement in its new browser are illegal.
After unveiling its open-source Web browser in January, Brave Software proposed a new business model that would include blocking publishers ads and replacing them with its own ads, while still displaying the publishers’ content on the browser and apps.
Overseas, publishers have banded together to enforce blackouts on ad-blockers in France and Sweden, while a number of U.S. publishers have tested their own bans on ad-block users, including Forbes and The New York Times.
Typically, publishers first present a message asking the visitor to disable their ad-blocking software and briefly explain the importance of ad revenues to their continued operation.