Apple, earlier this year, made it harder for third-party advertisers to display user-interest-based ads on iPhone. iOS 14.5 and above have a feature called App Tracking Transparency, enabling which shows general ads to the user instead of user-interest-based ads on the app. Ever since the feature’s release, advertisers like Facebook has been complaining that the changes have costed in increased ad budgets for most of the companies — even though the social network giant posted healthy ad revenue numbers in Q2, 2021 — the changes seem to have benefitted Apple’s ad business unit.
According to a new report from Financial Times, Apple’s ad business unit has seen an immense growth of 58% since App Tracking Transparency was released with iOS 14.5. According to the report, Apple’s Search Ads have seen a sudden rise in usage bringing app downloads via ads to 58% from 17% just a year ago. All in all, Apple could earn nearly $5 billion from its ad business in 2021, according to the report. Financial Times also says that the revenue could increase to $20 billion a year within three years.
“It’s like Apple Search Ads has gone from playing in the minor leagues to winning the World Series in the span of half a year,” said the product marketing head of Branch, Alex Bauer. Researchers at Evercore ISI claim that Apple has “significantly altered the [advertising business] landscape.”
Another mobile advertising executive whose name wasn’t mentioned in the Financial Times’ report said that “[Apple has] given itself a free pass” because the company isn’t “subject to the same policy that every other ad network is.” In the Privacy settings of iOS, Apple has conveniently placed third-party app tracking toggle to the top and its own targeted ad business settings towards the bottom.
Despite the clear growth Apple’s ad business has achieved, the company continues to say that its “privacy features were designed to protect users.” In a statement, Apple said, “The technologies are part of one comprehensive system designed to help developers implement safe advertising practices and protect users — not to advantage Apple.”
Source: Financial Times