Our recent adblocking report contained some shocking numbers. In the United States alone, adblocking resulted in an estimated $5.8bn in blocked revenue in 2014 and is expected to cost publishers $10.7bn in unrealized revenue in 2015.
To put these figures into perspective, we decided to see what $10.7bn would buy in the real world, and to determine what this means for publishers and publishing jobs.
What you can buy with $10.7bn
At the high end, one Nimitz class aircraft carrier costs approx. $4.45bn to construct. These are the largest warships afloat, propelled by two nuclear reactors. Each is a third of a kilometre long (1,092 ft), has up to 6,000 people aboard, and can accommodate 130 aircraft. They are truly massive. The $10.7bn of adblocking could comfortably pay for two of these titanic vessels.
The Nimitz-class is soon to be superseded by the Gerald R. Ford class aircraft carrier, which comes in at $10.44bn. Due to enter service in 2016, these are even more massive than the Nimitz class carriers that have been serving the United States for the last 40 years. Our $10.7bn could pay for one of these.
Leaving the dizzying realms of defense budgets behind and moving on to more practical comparisons, $10.7bn would cover the cost of the Federal Bureau of Investigation for a year (annual budget of $8.3bn), with enough left over to pay for the Los Angeles Police Department (annual budget of $1.4bn).
On a more human scale, Donald Trump earlier this year announced that his personal net worth is “in excess of ten billion dollars”, so revenue lost to adblocking would wipe out the fortune of the tycoon presidential candidate.
The cost to publishers
Ten billion dollars sounds like small change when looking at aircraft carriers, FBI budgets and the net worth of the super-rich, but the problem is that this money is not disappearing from places which can afford it: it is being bled from publishers who are already hitting the wall in terms of profitability. This in turn is threatening the livelihoods of the people who make the web a wonderful source of news, entertainment, creativity and information.
At a median salary of $38k per year in the US, journalists would certainly notice $10.7bn disappearing from the market. As would web developers, at $55k, web designers, at $45k, copy editors, at $41k, and graphic designers, at $40k. In fact, taking the average $43.8k salary of these jobs (data from PayScale), that $10.7bn would pay over 245,000 employees. That is, literally, a small city’s population. In fact, it is just slightly more than the total population of Winston-Salem in North California. Winston-Salem is actually pretty big. It covers an area of 132.4 sq miles (343 km2).
Focusing on journalists, once the backbone of news in the United States and responsible for breaking the stories that keep those in power relatively honest, the Bureau of Labor Statistics reported that there were 46,590 “news analysts, reporters and correspondents” employed in the US in 2014. It’s safe to say that the $10.7bn being lost would cover a lot of mortgage payments, healthcare, school fees, groceries and everything else that a real person needs to keep going while doing their job well.
News outlets of all kinds are increasingly dependent on the Internet to pay the bills, with advertising dwarfing subscriptions and paywalls in terms of revenue. PageFair predicts that the loss of revenue to adblocking will rise to $20.3bn in 2016. Forget about aircraft carriers and presidential candidates; revenue lost to adblocking is about an altogether more human cost.
Data from PageFair, Wikipedia, FBI, LAPD, US Congress Research Service, US Dept. of Labor, PayScale.