Yahoo Exec Calls Out Mobile Ad Blocker for ‘Destroying the Ecosystem’

Heated discussion compares digital advertising to 'military-grade tracking'

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BARCELONA, Spain—A panel discussion about ad-blocking at Mobile World Congress showed just how high the tension is getting between advertisers, tech companies and ad blockers.

Speaking to a packed room full of marketers, execs from Google, Shine, Nestlé, AOL and Yahoo talked about why consumers use mobile ad blockers and what marketers can do to improve the quality of online ads. Much of the talk specifically revolved around mobile ad blocker Shine and how it is working with carriers to remove ads.

Shine works with European carrier Three Group and Caribbean telco Digicel to power ad-blocking technology that consumers opt into. Unlike other blockers like AdBlock Plus, Shine does not "whitelist" specific publishers, meaning its technology blocks all smartphone ads.

"What we are doing can be considered blunt, but we believe that our strategy is more about helping expedite a solution rather than sitting and discussing it," said Roi Carthy, CMO of Shine.

"Every individual using a mobile handset, smartphone or desktop is being abused by ad-tech—that's not selective, that is 100 percent," he argued. "We're talking about military-grade tracking, targeting and profiling. Consumers do not have the ability to protect themselves. I understand that there is a criticism that all publishers are being painted with a single brush—there needs to be more nuance here—however, where the conversation is right now with ad blocking is less about nuance and more about sending a very clear signal."

In the middle of the ad-blocking war are companies like Google, AOL and Yahoo that power millions of digital ads publishers rely on to make money.

Benjamin Faes, managing director of media and platforms at Google, said he's alarmed by mobile ad blockers that work directly with carriers.

"I'm very uncomfortable by the idea that an operator or an ad-blocking company can decide on my behalf that I'm not seeing any ads," he added. "In that case, we see an issue for the user themselves. More and more, publishers just can't afford to give that content for free without the fair trade of ad-business content."

Nick Hugh, Yahoo's vp and gm of advertising in Europe, the Middle East and Africa, added, "My concern with this blunt instrument is you're blocking at a network level. But, actually at a publisher or property level, there are some [ads] that are very good. If you block everyone, you completely destroy the value exchange and the ecosystem."

Carthy said Shine is open to talking with advertisers, ad-tech companies and publishers about what rules should be put in place to improve the quality of ads. He added that anywhere from 5 percent to 50 percent of a consumer's data plan is consumed by advertising technology. He also said Shine currently does not make any money.

"Anytime you get a range of 5 to 50 percent, it's such a big range that it's almost impossible to [take] action," quipped Yahoo's Hugh.

Pete Blackshaw, Nestlé's vp of digital and social media, said that a quick glance at reviews for ad-blocking apps in Apple's App Store shows why consumers are fed up with intrusive ads.

For example, one of the top reviews for popular mobile ad blocker Purify reads, "I wish I didn't need this. I realize content providers depend on ad revenue, but I finally couldn't take any more full-page takeover ads and 'warning: your iPhone is infected' pop-ups."

"What's good about the debate is that it's forcing us—as we should as marketers—to stay very close to consumer opinion and sentiment," Blackshaw said. "It's hard not to sympathize with some of the issues around user experience and load time.

"Somewhere in the middle there is a more accepted ad model that consumers will accept, similar to how consumers ultimately accept the paid music model when everyone kind of concluded that would never happen."

Nestlé has started to use minute-long videos in the privacy section of its website to explain to consumers how data is collected.

"Transparency is definitely hard, but that's part of the tension that we need to manage in today's environment," Blackshaw said. "We're the heart and soul of the creative community. Surely we can step up the game in how we articulate the value exchange."

AOL's CMO Allie Kline added that brands need to refocus the argument. "I worry at times that we spend a lot of time talking about how to stop ads versus how to invest in content and creative," she said.

@laurenjohnson Lauren Johnson is a senior technology editor for Adweek, where she specializes in covering mobile, social platforms and emerging tech.