Facebook enjoyed a boost in share values after announcing in their latest financial report that mobile ad revenue particularly is soaring (responsible for 41% of all advertising income).
However, it has also been suggested that advertising on social networks is not a particularly efficient or reliable revenue stream. A recent survey by Greenlight, reported by Silicon Republic, found that 70% of Facebook users rarely, if ever, click on ads or sponsored links. 15% of people surveyed also said they’d be willing to pay for an ad-free Facebook.
Biz Stone, one of Twitter’s founders, suggested earlier this week that a ‘premium’ model for Facebook could be a big earner for the company. By eliminating advertisements and offering subscribers some sort of extra features, Stone estimates that if even 10% of Facebook users opted-in to an €7.50 a month ad-free model, the social network could earn somewhere in the region of €9-10 billion a year. In comparison, they earned €1.2 billion from advertising during the second quarter of this year.
Of course, the counter-argument is that social networks such as Facebook and Twitter have proven popular precisely because they’re free to access and ad-supported. However, a theoretical subscription model would be predominantly aimed at dedicated users, with the standard advertising model retained for the vast majority.
Do you think paid subscriptions for ad-free social networks are a good idea and a sensible financial move for these companies? Would you pay to free up your Newsfeed or Twitter stream from advertising? Do you simply ignore ads and ‘sponsored’ posts? Vote in our poll and leave your comments below.