The AI industry is about to relearn every lesson of the ad blocking wars | Tech Radar

Overview

News, deals, reviews, guides and more on the newest computing gadgets

Start exploring exclusive deals, expert advice and more

Details

Unlock and manage exclusive Techradar member rewards.

Unlock instant access to exclusive member features.

Get full access to premium articles, exclusive features and a growing list of member rewards.

The AI industry is about to relearn every lesson of the ad blocking wars

AI advertising is repeating the ad blocking wars' mistakes

When you purchase through links on our site, we may earn an affiliate commission. Here’s how it works.

Maybe money does not explain everything, but it explains a lot. Goldman Sachs estimates the AI build-out will require roughly $7.6 trillion in capital over the next five years across compute, data centers and power. It’s unlikely that subscriptions alone will cover the bill, which is why ads are coming to AI.

Open AI started rolling out ads in some Chat GPT tiers this year and forecasts

2.5 billion in ad revenue in 2026 and

100 billion by 2030. At an ad tech event this summer, Open AI's chief revenue officer Denise Dresser dropped the hedging and said the company is "clearly in the advertising business now."

Perplexity, on the other hand, shut down its ad business entirely over user trust. Similar products, same opportunity, opposite conclusions.

Leads communications for Adblock Plus and Ad Block at eyeo.

This conflict is not new and the open web fought this battle 15 years ago, when ad blocking became mainstream.

Now, the AI industry is on track to repeat every mistake of the so-called ad blocking wars, unless it studies them instead.

What businesses can do as Cloudflare readies to categorize AI traffic

The invisible traffic problem: why AI agents are your biggest blind spot

Everyone is now an AI company. But here’s the real challenge

Lesson one: users revolt faster than big platforms think

When ad formats became more intrusive - because again, money! - the industry assumed users would just accept a bad experience. Instead, users fought back and installed software to get rid of aggressive online ads. In what technology commentator Doc Searls called “the biggest boycott in world history”, ad blocking went from being a niche tool to a mainstream product.

And we see the same dynamic playing out again. Within weeks of sponsored ads appearing in Chat GPT, purpose-built extensions popped up to specifically block ads there. Existing ad blocking tools made sure to block those ads as well. It took hours and days, not weeks or months, for users to act.

Lesson two: the arms race is unwinnable, both legal and technical

The predictable response is, of course, to sue ad blockers. For some publishers, the idea that users take agency over their own screens was not acceptable, so they took ad blocker developers to court. Almost all of the legal attempts failed. With one case still pending at the German courts, China is the only country in the world that bans ad blockers.

Another tactic is technology to fight ad blockers. Platforms tried different circumvention methods to deliver ads to users with ad blockers installed. This prompted their developers to update their techniques to prevent websites from bypassing. Every technical escalation met a counter-escalation and the sum of a lot of engineering efforts on both sides is that, today, over a billion people still block ads.

AI platforms hold one card their predecessors didn't, though: integrating advertising directly into the generated answers, instead of showing labelled ads. Researchers from the University of Michigan tried exactly this and the results should worry everyone involved: users largely don't expect advertising inside a generated answer and frequently fail to notice it.

The companies cutting humans for AI are about to learn an expensive lesson

The AI data problem nobody talks about: Why more information isn't making better decisions

‘Regulation by litigation is often overlooked as a regulatory tool’: Just how much responsibility should AI companies have on their users’ wellbeing?

At the same time, 63% of consumers say ads decrease their trust in AI outputs, according to Ipsos. The format that works best technically is the one users are least equipped to detect, and least willing to trust. Which brings us to the most important lesson.

As soon as users suspect that answers might be influenced by a sponsor, these doubts are attached to all answers and trust erodes.

Cory Doctorow coined the term “enshittification”, which the American Dialect Society crowned as its Word of the Year in 2023. Platforms start out by doing good to their users and then degrade their experience to make advertisers happy.

And compared to tracking-based advertising in the open web, AI assistants know so much more about you that they can sell to advertisers: your health worries, your finances, your political view, your job struggles and everything else these tools picked up from you, stitched into one persistent memory of who you are.

It’s the most revealing personal record people have ever handed to software, combined with the drive from digital advertising to always collect more data and more data for targeting. The table is set for the next wave of enshittification.

Lesson four: the ad blocking wars ended in a treaty, not a victory

There was no final winner and not one technical solution that settled ad blocking in the open web. There was a rough settlement: standards for ad formats many users tolerate, transparency about what is paid for, meaningful user control.

Not everyone loves that settlement and we still see platforms trying to circumvent ad blockers and vice versa. But the open web still has a functioning ad economy and users still have, mostly, a functioning veto.

Getting there took more than a decade and the lessons are written down. Which road to take is now a genuine choice and it sits with the AI companies themselves.

This article was produced as part of Tech Radar Pro Perspectives, our channel to feature the best and brightest minds in the technology industry today.

The views expressed here are those of the author and are not necessarily those of Tech Radar Pro or Future plc. If you are interested in contributing find out more here: https://www.techradar.com/pro/perspectives-how-to-submit

Leads communications for Adblock Plus and Ad Block at eyeo.

You must confirm your public display name before commenting

Sihoo Doro C300 Pro V2 office chair in Labor Day & back-to-school sale

'A computer should not make decisions on its own': Uber fined $1 billion for using automated systems to suspend 171 drivers

New Philips Hue module reportedly allows Nanoleaf integration

Logitech's ergonomic keyboard and trackball mouse are both 15% off

Tech Radar is part of Future US Inc, an international media group and leading digital publisher. Visit our corporate site.

Key Takeaways

News, deals, reviews, guides and more on the newest computing gadgets
Start exploring exclusive deals, expert advice and more
Unlock and manage exclusive Techradar member rewards
Unlock instant access to exclusive member features
Get full access to premium articles, exclusive features and a growing list of member rewards