Dec 4, 2018 - Technology

Amazon eats into the Google-Facebook duopoly

Google and Facebook, often referred to as “The Duopoly,” were responsible for roughly 75% of all digital advertising growth last quarter in the United States, according to Brian Wieser, Senior Advertising Analyst at Pivotal Research.

Reproduced from eMarketer; Chart: Axios Visuals

While this seems high, the percentage share of growth of new ad dollars coming from these two firms has actually dropped, mostly due to declines in growth projections at Facebook and increases in projections at Amazon. eMarketer estimates that Google and Facebook will capture 56.8% of the U.S. digital ad market this year. That's down from 58.5% last year.

Between the lines: Wieser notes that if his estimates are correct, digital advertising that did not go through Facebook or Google performed reasonably well during first half of 2018, growing by around +18%, or ~$1.5 billion.

  • This is especially optimistic, considering the fact that Wieser calculated that in 2016 ”the average growth rate for every other company in the sector was close to 0.”

The bottom line: It’s unlikely digital news publishers are the ones seeing those gains.

  • What’s driving growth in digital advertising outside of Google and Facebook’s share is mostly Amazon, which Wieser estimates likely added $1 billion in in domestic ad revenue during the first half of 2018 versus the first half of 2017.
  • In September, eMarketer estimated that Amazon’s ad business will bring in $4.61 billion this year, up 60% from the projection of $2.89 billion in March.
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