Apple Axing Advertising

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Apple is waging a battle on advertising, as they have made ad-blocking software available on the iPhone with the new operating system iOS9. This likely undermines their arch-rival Google, which dominates the $120 billion online ad market.

For the first time, third-party software strip out marketing messages such as banner and video ads when people surf the web via the Safari browser. But Apple’s new approach will not affect advertising inside applications such as Facebook, casual games, or even Apple’s own applications. In effect, Apple is nudging companies to shift spending to apps, rather than traditional online ads where Google leads. 200 million people have used ad blockers last year, up 40% from a year earlier, resulting in $22 billion in lost advertising revenue.

Incidentally, Apple has launched their own news app, which will allow media companies to bypass blockers to serve their own ads or let Apple sell ads and share the revenue. It will be interesting to see how these moves made by Apple will affect its own interests, and if it will loosen Google’s hold on the mobile ad market.

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