Will The New York Times Be the Next to Ban Ad Blockers?

Subscription revenue doesn't cover all of the newspaper's costs

Subscription News: Will The New York Times Be the Next to Ban Ad Blockers?

Source: The New York Times

During a keynote discussion during Social Media Week in New York last week, New York Times CEO Mark Thompson spoke against the use of ad blockers, said Ad Week, likening their use to stealing a print issue of a newspaper.

“Trying to use and get benefit of the Times’ journalism without making any contribution to how it’s paid (for) is not good. Everything we do is worth paying for. Everything should feel like it’s HBO rather than a broadcast network,” Thompson said. “[Times journalism] is an expensive, handcrafted thing that needs to be paid for.”

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The CEO further pointed out that, as with many similar publications, the subscription model does not cover all of the newspaper’s costs, reported Ad Week. Those other costs are covered by advertising and sponsorship dollars, and those may be in danger as the usage of ad blockers grows.

Last year alone, ad blocking was estimated to have cost publishers $21.8 billion. That number is expected to nearly double to $41.4 billion this year. (See our December 1, 2015 report on “Ad Blocking: A $21.8 Billion Problem” for additional details, statistics and solutions.)

Subscription News: Will The New York Times Be the Next to Ban Ad Blockers?

Source: The New York Times

During the discussion, Thompson said he is considering banning non-subscribers who use ad blockers from the site. Other publishers have already done so, including Wired and GQ who have asked readers to either whitelist their site or to pay a small subscription fee in exchange for an ad-free experience.

Though the New York Times is moving away from traditional display ads as that revenue source continues to decline, banning ad blockers remains on the table. Instead of display ads, Thompson said the company is moving toward more branded content to better engage readers.

In a January 2016 blog post, Percolate reported the four primary solutions publishers are utilizing to combat ad blocking.

  • Content blocking – 47%
  • Paywalls – 25%
  • Subscription models – 22%
  • Using an ad block vendor – 9%

(Note: the total is 103% which may mean some publishers will employ multiple solutions.)

Insider Take:

As the usage of ad blocking becomes more prevalent, publications like the New York Times have to find solutions that keep their business models sustainable. To do so, they have to serve their subscribers as well as their advertisers. A mix of a metered paywall, subscriptions and content blocking may be needed to help the Times find the right balance.

There are bigger issues at play here than just the Times’ need for long-term sustainability though. One of the biggest issues is that readers want privacy online. They don’t want their data tracked and shared, nor do they want to be inundated with annoying, intrusive ads. This is a problem that extends far beyond the publishing industry, and something that can’t be solved overnight.

Media organizations can, however, take steps to mitigate the impact of ad blocking until a more palatable solution can be found. In the meantime, we expect more companies to take a stand against ad blocking. Should the New York Times choose to ban ad blockers, as a publishing stalwart, it will be among the most prominent to take a stand, and we expect others to follow suit.