Although the world’s largest Internet companies derive the majority of their income from online advertising, some of the most powerful browser add-ons are ad blockers. One of the most prominent ad blocking plug-ins is Adblock Plus from Firefox. Adblock Plus allows you to cut out unwanted pop-up ads and in-page graphics. This often results in a better Internet experience since it prevents download of the larger graphics and animations of advertisements. Wladimir Palant, the developer of the open-source Adblock Plus project, estimated in 2007 that there were 2.5 million users around the world with 300,000 to 400,000 new users every month.
There is currently no case law precedent bearing on the issue of the legality of adblocking software; however, there is precedent on the issue of whether ad skipping should be allowed under the copyright law. In Sony Corp. of America v. Universal City Studios, Inc., otherwise known as the Betamax case, Universal Studios contested the legality of home video recorders because they allowed viewers to skip the advertisements that were normally part of television broadcasts by fast-forwarding through them. The court dismissed that argument and reasoned that the viewer still had to receive and record the commercials as part of the transition, and that fast-forwarding is a process that would be too tedious for most viewers. In fact, the court found that only 25% of viewers took advantage of the fast-forwarding feature. In 1982, Judge Posner held in WGN v. United Video, that commercial skipping created an unauthorized derivative work since it reduced the copyright owner’s income, which was funded by the purchase of commercials through advertising. The ruling is not controlling, however, because ad-skipping was not the focus of the case.
More recently, Realplay TV was sued in 2002 for its commercial skipping features, but the company soon faced bankruptcy so no legal decision was reached. The issue was once again revived this year when Fox sued Dish Network in Fox Broadcasting v. Dish Network for its ad-free primetime television service and its AutoHop features. Although no final decision has been rendered yet, the District Court for the Central District of California ruled that the copies that are made from the AutoHop feature were infringing, but denied Fox’s preliminary injunction because it found that Fox’s damages were not suitable for an injunction. R. Stanton Dodge, general counsel for Dish Network, saw the decision as in line with the Betamax decision and a victory for consumer choice and the right of consumers to enjoy their TV programs however they wanted to.
Given the current legal atmosphere in for commercial skipping features in TV programs, it seems like it will only be a matter of time before companies turn to ad-blocking on the Internet as well. In fact, although there has been no litigation on the matter, individual website owners have already taken action against the Adblock software. In response to Firefox’s Adblock Plus add-on, some websites have already started blocking Firefox users from their websites. One such site, whyfirefoxisblocked.com, writes that because of Adblock’s effectiveness on all websites, “blocking Firefox is the only alternative.”
So far, Palant suspects that the reason major Internet presences like Google have not gone after Adblock Plus is because the program is not popular enough and would be a waste of time for them. However, according to John Palfrey, executive director of Harvard Law School’s Berkman Center for Internet and Society, if the adblock software begins to cut away at the advertising companies’ revenues, there would “absolutely” be litigation around the issue.