Mobile Ad Blocking Takes Off In Asia, Sparked By User Data Costs
March 22, 2017
Want to know what large-scale mobile ad blocking looks like? Go to Asia, specifically China and India, where the bulk of the world’s new smartphone users are entering the market.
A PageFair report last year said mobile browsers with pre-installed ad blockers more than doubled over the previous year and now outnumber those without ad blocking.
Whereas only 1.7 million American smartphones users had browsers with default ad blocking installed at this point last year, 116 million did in China, 89 million did in India and 28 million did in Indonesia.
The reason many people block ads in APAC markets is not annoyance or poor user experience, which were the principle factors in the rise of desktop ad blocking in the US and Europe. It's data cost, pure and simple.
“One thing you see if you’re in Asia traveling around these markets is that people are on a limited mobile plan, so they’ll do anything to minimize the use of their data,” said Andy Fan, founder and CEO of the Shanghai-based digital ad analytics company RTB Asia. It isn’t a matter of being annoyed with ads, he said, it’s that over the course of a month blocking ads could save days of browsing before hitting a pay cap.
Asia’s leading browser, the Alibaba-owned UC Browser, passed Chrome in overall mobile market share in the region last year, according to web tracking tool StatCounter. UC Browser is also strong in the triumvirate of major APAC markets, with a 47% plurality of mobile browser market share in Indonesia, 54% in India and 13% in China.
Additionally, Samsung, Safari and Opera each represent between 6% and 10% of mobile browsers in Asia. Jana, a mobile ad company focused on the developing world, released a mobile browser this month that offers data-free browsing periods (10 megabytes, or about 20 minutes per day), which it plans to monetize through search licensing deals and ad sponsors.
Adblock Plus (ABP), the world’s most popular ad-blocking software for desktop browsers, has relatively little purchase in Asian markets and has seen adoption plateau even while mobile browser-based ad blocking has soared in the region.
“It’s actually reached the point where UC blocks more ads than we do even though people don’t think of them that way,” said Till Faida, CEO of Eyeo, the tech company that owns ABP.
The mass adoption of mobile ad blocking would seem to be a crippling trend for marketers in the region. But many agencies AdExchanger spoke with take the philosophical view – for now.
“There are so many users coming on and so much collective media consumption being made available that in that context the supply hasn’t been meaningfully reduced,” said Arshan Saha, Xaxis’ APAC president.
Saha compared those lost ads to a slight decrease in water pressure for someone trying to drink from a fire hose, but he acknowledged the issue will loom larger in two to three years, as new user growth starts to plateau in some APAC countries.
Another factor is mitigating concern: the rise of native ads. In-feed placements are dominant on platforms like Tencent and WeChat in China, and they're often not screened out by today's crop of low-bandwidth browsers.
According to RTB Asia's Fan, mobile ad blocking “can threaten the long tail of apps certainly, but because native ads that don’t get blocked are becoming the norm on platforms that are totally dominant in China, like Tencent and WeChat products, it isn’t a major threat to the advertising industry.”
Saha said he anticipates more scrutiny and oversight of internet advertising in APAC, potentially alleviating concerns about mobile ad blocking. “Mobile ads in Asia have been overpopulated, heavy and just bad because there’s no true IAB- or MRC-type certification, and it meant many mobile users weren’t able to enjoy it.”
Will Asia's ad-blocking trend play out in Western markets, wreaking havoc with US and European publishers? There's little sign of that. Yet.
"The numbers in the US still lag China significantly and we haven’t seen significant increases over the last year or so,” said Ben Barokas, founder and CEO of publisher monetization firm Sourcepoint.
But it could happen. Barokas cited Samsung’s decision last week to make its ad-blocking browser available on Google’s Pixel and Nexus devices as one example of a UC Browser-inspired move that could keep nudging up mobile ad blocking in the US.
"Mobile monetization is still a major pain point,” Barokas said. “And even small increases would represent increased headaches and challenge for digital publishers.”More