Google beware, Facebook’s coming for you: Facebook’s Audience Network is now an open ad exchange and will be looking to take on Google’s AdSense. The social media major’s advertising network will now start displaying ads to non-users as well. Till now Facebook non-users and logged out users didn’t see ads powered by Facebook’s Audience Network on third-party sites or apps. Now that changes. Note that you have the option off opting out of ads, irrespective of whether you’re a Facebook user or not. More on that here.
Earlier this month, Audience Network was expanded to desktop and it was announced that it will start selling video ads on behalf of other companies. The company had said that its advertising network will deliver ads in both in-stream and in-article formats. At the time, Facebook had claimed that its two-year-old Audience Network accounts for almost 6% of all time spent by U.S. web surfers on mobile.
How does Facebook and Google’s ad revenue stack up?
Both Facebook and Google depend heavily on advertising for revenue generation. Facebook’s ad revenue increased 57% year-on-year to $5.2 billion in the first quarter of 2016, from $3.3 billion in the same quarter last year. The company reported 1.65 billion monthly active users (MAU) in Q1 2016, of which 1.51 billion or 91.5% were on mobile.
On the other hand, Google still runs one of the biggest online ad networks and dominates digital advertising, with advertising revenues of $18.02 billion in Q1 2016, an increase of 16.18% year-on-year from $15.51 billion in the same period last year.
Ad revenue share
The revenue share in case of Audience Network is not clear, though Wall Street Journal had reported Facebook pockets about 30% share of revenue, which would mean the publishers’ share would be about 70%. Note that this hasn’t been confirmed by the company. Google’s AdSense revenue share model is clearly specified: publishers receive 68% of the revenue, for displaying ads for content. In case of search, publishers receive 51% of the revenue. Geographic location of the publisher doesn’t affect the share percentage. It’ll be interesting to see if in the coming days or months Google tweaks this share a bit, just to make it that much more difficult for Facebook.