How Facebook and Google Earn 80% annual revenue Spent on Digital Ads

 

The Teach giant company Google and Facebook who’s power depends on selling advertising space on their various Digital media platforms which include websites and mobile applications as well video content has taken over digital ad space.

A recent report from the United Kingdom’s competition watchdog has shown that Facebook and Google earned 80 percent of all the money spent by advertisers on digital platforms in 2019.

Though, Digital advertising helps businesses find customers and supports the websites that people know and love. Advertisers today choose from a wide range of platforms that compete with each other to deliver the most effective and innovative ad formats and products.

According to the CMA report, out of the £14 billion spent on digital advertising in the United Kingdom in 2019, Google with more than 90 percent share of market search earned £7.3 billon while Facebook with more than 50 percent of display market earned £5.5 billion. Representing 80 percent of the total digital ads spent in 2019.

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In the 440-page report, the Competition and Markets Authority (CMA), UK said Google and Facebook market positions are having a “profound impact” on newspapers that now receive almost 40 percent of all visits to their sites through the two platforms.

Though the two digital platforms has help small businesses reach customers and are valued by users, they have “developed such unassailable market positions that rivals can no longer compete on equal terms”.

This dependency potentially squeezes their share of digital advertising revenues, undermining their ability to produce valuable content,” .

According to Interactive Advertising Bureau, growth in digital ad in United states spending went to Google and Facebook, which already account for more than three-quarters of the U.S. digital ad market with record $72.5 billion.

Google and Facebook respond

According to Facebook spokesperson, Providing a free service, funded by advertising that is relevant and useful, gives millions of people and businesses the opportunity to connect and share.

Facebook  face significant competition from the likes of Google, Apple, Snap, Twitter and Amazon, as well as new entrants like TikTok, which keeps us on our toes.

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