Apple Is Plotting To Push More Ads To Your iPhone But Claims To Respect Privacy

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Internal moves and discussions at Apple may indicate that the company is moving to grow its advertising business. Apple already generates around $4 billion in ad revenue every year. However, according to Bloomberg, Apple’s vice president of the ad group, Todd Teresi, is pushing for a significant expansion of the company’s advertising business. His current goal is to boost annual advertising revenue into the tens of billions. Teresi may also be positioned to expand Apple’s ad business in pursuit of this goal, as he recently began reporting directly to the company’s service chief, Eddy Cue, rather than reporting to Peter Stern, Apple’s deputy services head.

The last time Teresi reported directly to Cue was in the days of iAd. iAd was Apple’s own advertising network launched in 2010, but the company eventually shut down this venture in 2016. During its time, iAd provided in-app advertisements to third party apps, similar to Google’s in-app ads network. However, nowadays, Apple displays ads only within its own apps, namely the App Store, as well as Apple News and Stocks. Even subscribers to News+ still see ads in the Apple News app, though fewer of them. If Apple does expand its advertising business, we’ll have to see whether the company introduces ads to more of its own apps or takes a second run at providing ads to third party apps.

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User data used for advertising purposes within the Apple News (click to enlarge)

The news that Teresi is looking to increase Apple’s ad revenue comes after the company introduced its App Tracking Transparency (ATT) feature, which appears to have cut heavily into other companies’ advertising revenue. Meta projected that ATT would cost Facebook $10 billion in revenue in 2022. Other reports have also shown Snapchat, Twitter, and YouTube as losing billions in revenue after Apple’s implementation of ATT.

Much of online advertising these days is highly targeted at specific user advertising profiles that are based on large amounts of user data. ATT aims to prevent the collection and sharing of user data without user consent by requiring app developers to list what data they collect and share and for what purpose and giving users the option to opt out of this behavior. ATT isn’t perfect at preventing apps from collecting and sharing user data, as some apps use clever methods for fingerprinting users in ways that fall within the bounds of Apple’s policies. Still, the massive advertising revenue losses demonstrate that ATT has certainly managed to cut down on this behavior.

ATT fits into Apple’s public goal to protect user privacy. However, Apple’s own advertising efforts seem somewhat contrary to this goal. The ads presented in the Apple News app are targeted with user data that is linked to each user, including purchase history, location, and usage data. Users can disable personalized ads in the Privacy & Security settings menu, but this setting doesn’t completely prevent Apple News from serving ads based on some device information and what users read within the app. ATT is intended to stop apps from tracking users across third-party apps and websites, not first-party in-app tracking. If Apple introduces ads into more of its own apps, it will expand first-party tracking to these apps as well.