The online ad industry is about to face a massive disruption, but there’s still a lot of work to be done.
That’s what Google and the Internet giant Facebook have been saying for months, with the two companies working to put the brakes on games on both their platforms.
But the big question remains: Will it all work out?
The answers are still up in the air.
Read moreAt the end of August, Facebook announced that its advertising partners were “in the process of finalizing a deal that will provide us with a significant amount of revenue from the sale of ads on the platform.”
In an investor call, Facebook CEO Mark Zuckerberg said that it was “very likely” that the company would have to “pause all sales of games, ads and content” on its platforms.
The announcement came less than two months after Facebook acquired the company Playdek, which had developed the ad network GameSpy for about two years.
Zuckerberg said at the time that the acquisition was “a strategic decision that we made because of the incredible work that our partners have done to bring their ad network to our platform.”
But, in a new interview with the BBC, Zuckerberg says that this deal was not the result of “a big push to put us out of business.”
Rather, it was the result “of a combination of events that are very difficult to forecast.”
In his BBC interview, Zuckerberg, who is known to be a firm believer in a single market and open to free market solutions, explained that his decision to purchase Playdeks “was a strategic decision” because it allowed him to “make a really big bet on the future of the ad ecosystem.”
That “big bet” is a very big bet, to say the least.
GameSpies ad network has been a core part of Facebook’s business since 2011, and in the years since it has grown exponentially.
In its most recent quarter, it accounted for nearly half of the company’s total revenue, and Facebook is reportedly paying it around $150 million per year.
That said, Zuckerberg said in the interview that this move “does not mean that we will stop supporting the ad industry.”
He added that “there are lots of opportunities in the ad market” and that “our partners are committed to bringing this amazing ad platform to all of our users.”
The move is all the more noteworthy given that Facebook has spent years working to limit the use of its platform to advertising, a strategy that has resulted in the company having a dominant position in online advertising.
In an effort to ensure that its platforms remain a “free-for-all,” the company has been trying to convince advertisers that they have no obligation to pay for ads, and that users have no choice in the matter.
This was one of the major arguments behind the move by Facebook in 2015 to end the practice of paid advertisements on its platform.
It was also one of its main complaints about the ad blocking software AdBlock Plus.
Since then, the company also has been moving aggressively to block ad blockers on other platforms, including WhatsApp, YouTube, Facebook, and the iOS and Android mobile operating systems.
So how did this change in strategy come about?
Zuckerberg’s answer to this question is a bit more complicated than it first seems.
In a recent interview with The Wall Street Journal, Zuckerberg explained that the “strategic shift” was a result of a “tipping point” for his company.
“I’ve been working on it for two years and I realized that it’s really important for us to make it clear that we don’t need to monetize,” he said.
“We don’t have to monetise because we’re the ones that create the content and the ads.”
But what is the content that Facebook creates?
As it turns out, there are a lot.
As of the end, Facebook’s ad revenue on its Facebook platform has increased by over 3,000% in the past year alone, and it is now generating more than $10 billion a year in ad revenue.
The company’s ad partners are now able to spend that money directly on the ads that they serve, meaning that advertisers can now make money directly from the ads they have purchased.
Zuckerberg explained that Facebook is “now a global brand” and is “the platform that millions of people visit every day.”
And that is precisely what he and his partners are looking for, as he and Facebook continue to push the ad platform further and further out into the world.
“We believe that the future is online, that is where the future lies,” he continued.
“This is why we have built the AdMob and AdSense services and we are building the AdSense for publishers and developers.
We’re going to be the dominant ad platform for the next 20 years.”
What this means is that the advertising business is going to get a lot more complicated.
It’s going to need to be more like an international marketplace where different countries have their own standards and rules for what constitutes an acceptable ad, and companies will have to