How Tech Took a Bite Out of the Ad Industry
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The best content: ad-free
While 35% of content was viewed without ads through subscription services in 1994, today it’s 60% to 65%, said Rishad Tobaccowala, chairman of Publicis Groupe’s DigitasLBi and Razorfish. For $60 a month, people are paying for access to “the best content in the world without ever seeing an ad,” he said, totaling the cost of subscribing to Netflix, HBO, Showtime, Hulu and Spotify or Pandora.
If anything, technology has advertising in its teeth, keeps shaking it, and won’t let go. Even the tech giants who do more to shape the industry than anyone else — Google and Facebook (which notably didn’t exist 20 years ago) — keep struggling to find formats that work both for consumers and advertisers, who are left serving ignorable pre-roll, blending into other content with native ads or creating branded entertainment to stay in the game. That they haven’t fully succeeded means ad dollars haven’t just shifted, they’ve gotten less important in the broader economy.
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