We are well aware that the internet is beating TV and print to the profit punch. Advertising has well and truly moved to our computer screens. But new research has shown that Google and Facebook are dominating one-fifth of global ad revenue. How are they doing this?

Traditional media companies are hemorrhaging advertising funds. News groups including the Daily Mail, the Guardian, the New York Times and Wall Street Journal have all announced that they are laying off staff in recent months. It seems the social media giants are the reason why, but we didn’t realise their dominance was quite so prominent and shocking.

Compelo has been looking into the new research.

The Google and Facebook effect

Alphabet’s company Google is miles ahead of it’s competition when it comes to ad revenues. In 2016, they attracted over £61 billion in ad revenue, which was three-times more than Facebook. Facebook pulled in just over £20 billion, according to Zenith‘s Top Thirty Global Media Owners list. Combined however, they are still well ahead of their competition.

Which are the top companies?

  1. Alphabet (which owns Google and YouTube
  2. Facebook
  3. Baidu (the Chinese search engine site)
  4. Microsoft
  5. Yahoo
  6. Verizon (owns AOL and is acquiring Yahoo later this year)
  7. Twitter

These seven platforms generated over £132 billion in internet ad revenues in 2016. This accounted for (shockingly) nearly three-quarters of ALL internet ad spend and one-quarter of the total ad spend in the world.

We predict that this ranking will change, however. Twitter’s new partnership with Bloomberg to create 24/7 video news will no doubt boost their revenue earnings over the next few months. Watch this space!

Is it all getting too much?

Google may be dominating the advertising revenue scene, but is enough enough? The corporation is facing growing boycott from the likes of the UK government, McDonalds and Marks & Spencer, who are all major advertisers. Why? When advertisers discovered that their spend was being used to place banner adverts from groups such as Britain First, the companies felt that they were indirectly funding extremists. The result was that they pulled their ad spends.

What do the experts think?

Furthermore, key industry leaders have publicly expressed their concerns. The duopoly both Google and Facebook hold over the industry, plus their reluctance to call themselves media companies, is a worry. Throw in the fake news scandal, and we have an advertising world with fears for the future.

The CEO of WPP, Martin Sorrell, said: “When you have a duopoly, clients and agencies are looking for alternatives. Unless they acknowledge that they are media companies and not technology companies and therefore have the same responsibilities [as the news industry] for the truthfulness of their content that appears on their pages, until that happens, there could be a problem.”

What do you think about Google and Facebook’s dominance over the advertising industry? And the publishing industry? Read more here -

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