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Facebook is, obviously, a social media site. But it also is an advertising platform that links advertisers to consumers, and in this role, a recent move has stakeholders on all sides up in arms.

lo-res_dj2gjj-sAs a platform, Facebook has to mediate the interests of advertisers that pay it to place their ads on the site versus the interests of users who don’t want their social interactions interrupted by various product and service advertisements. These contradictory goals have prompted technical developments in support of both efforts. For example, ad blocking software helps consumers limit the number of advertisements that pop up as they browse websites, including Facebook. In turn, anti–ad blocking software entered the scene, offering a means to alter the signals that the blocking software uses to identify something as an advertisement. Thus the advertising gets around the ad blocking software, because it doesn’t look like advertising anymore, at least to the algorithm used by existing software.

Facebook is the latest and most prominent adopter of the anti–ad blocking software, suggesting that in this case, it is prioritizing the needs of its advertisers over the desires of its consumers. When users visit Facebook through their computers (the technology is different for mobile access), even if they have sophisticated ad blocking software installed, they will confront ads.

To explain its move, Facebook notes that even if advertising seems annoying, it serves a critical function for the overall social media platform: It pays for everything. If users want to keep using Facebook for free, the company needs to find some other source of revenue. But if the consumers block all the ads, then advertisers have no motivation to pay to appear on Facebook, ultimately disrupting the entire structure that enables most media sites to exist.

Similarly, some digital content publishers are experimenting with anti–ad blocking software, including Forbes, Wired, and The New York Times. Some options seek to solicit the help of users, such as by asking them to “whitelist” their specific site. This step tells the ad blocking software to give a free pass to the ads on a particular site. To convince users to agree, one publisher noted, “We need to spell this out clearly to our users. The journalism they enjoy costs real money and needs to be paid for.”

Advertisers have praised the moves, noting that by facilitating their marketing communications, Facebook and other platforms are enabling the market to survive. However, companies that write and sell the ad blocking software regard the move as unacceptable and cite as evidence the limitations it places on consumers’ ability to define what they will see on their computers. Furthermore, some privacy advocates argue that the ad blocking software can serve another function, as a means to limit the amount of tracking that websites can do. If the blocks on ad blocking become strong enough, such privacy protections would disappear too.

Together with these technological efforts to resolve the demands of its various stakeholders, Facebook added new options to allow users to indicate their advertising preferences, which it asserts are sufficient to keep customers happy. As a firm that provides a service to consumers, Facebook appears to be taking a big risk. As a business that supports other businesses, it might have no other option though.

Discussion Question:

  1. Should Facebook impose anti–ad blocking software?
  2. Is Facebook a business-to-business or a business-to-consumer company?
  3. How does your answer to the second question inform your answer to the first question?

Source: Mike Isaac, “Facebook Blocks Ad Blockers, But It Strives to Make Ads More Relevant,” The New York Times, August 9, 2016.