Given the rise of desktop ad blockers and the content blocking functionality of iOS 9, this new trend appears to be a legitimate threat to Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) and its Google search business. Ad blockers, to put it simply, make it possible to visit web pages without seeing the advertisements. That potentially improves user experience for the site visitor, but it could be very bad news for companies, including Google, which generate billions selling ads.

On this video segment, Motley Fool analysts Dylan Lewis and Sean O'Reilly comment on what Google CEO Sundar Pichai has to say about this hot topic.

Listen to the entire podcast by clicking here. A full transcript follows the video.


Sean O'Reilly: On previous shows, we've highlighted ad blocking as potentially bad.

Dylan Lewis: Yeah.

O'Reilly: Did they mention it at all? Did they mention the thing that shall not be named?

Lewis: Yeah. It's like the Voldemort for Google. It came up in the conference call. One of the analysts asked, "Is it something we could expect to have meaningful impact on revenue at some point in the near future?" Sundar Pichai fielded the question, the CEO of Google, and he said, "On the ad-blocking stuff, it's not a new phenomenon." He went on to say: "I think it's important to understand ads today fund almost all the services which people use, including products like Google Search, Maps, and many third-party products. For publishers, it represents the majority of revenue, and I think users are OK with the contract and we need to make sure it works well."

Everything that I'm hearing with ad blocking from Google is more along the lines of, "We need to make ads palatable to users, and not as invasive, and catered to their interests."

O'Reilly: It seems like he's implying -- I don't have a better word, and it's not the right one -- but a social contract between the American public and, "We're going to watch all this stuff for free and we'll accept some ads."

Lewis: It was funny because when I read that quote, a light bulb went off. I was, like, "Oh, yeah! I'm not paying to use that."

O'Reilly: No. A really big chunk of my music listening is done on YouTube, and I'm OK with the 15-second ad occasionally. I deal. It sounds like a pretty positive report.

Dylan Lewis has no position in any stocks mentioned. Sean O'Reilly has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Alphabet (A shares) and Alphabet (C shares). Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.