Apple’s App Tracking Transparency Network is Driving Advertisers Away from iOS

ios 14.5 app tracking transparency

Apple introduced a controversial privacy feature on iOS 14. The feature requires permission from users for cross-tracking across apps. This move severely impacted the amount of data advertising companies can collect. A new report claims advertisers have started spending more money on targeting Android users as opposed to iOS.

Apple rolled out the App Tracking Transparency framework in April this year. It is now compulsory for apps to ask users permission to track their data across other apps. Users get a prompt the first time they open any app on iOS. Data from ad-measurement firm Branch Metrics indicates that a whopping 67% choose to opt-out of tracking.

Ever since Apple announced the privacy features, advertisers, including Facebook, were unhappy. The affected companies warned Apple that the new feature would thwart their advertisement model and adversely impact business. It is no secret that the digital ad industry thrives on granular user data. Expectedly, the ad spends on iOS have fallen by one-third between June 1 and July 1. On the other hand, ad-spend on Android has increased by 10% during the exact timeframe.

After the tracking change took effect in April, many users of Apple’s iOS operating system have received a high volume of prompts from apps asking permission to track them—requests that most have declined. Less than 33% of iOS users opt in to tracking, according to ad-measurement firm Branch Metrics Inc.

Advertisement firms are seeing a shift in clients’ spending patterns. The advertisers are blinded by the lack of user’s interest, preferences and behavior across multiple apps. Typically, advertisers create a profile of the user and serve tailor-made ads. This helps in ensuring highly targeted adverts with increased potential for conversion.

Our Take

Facebook has accused Apple of impacting small businesses with a new privacy feature. The company painted it as “anti-compitative” and said it could help Apple run its advertising networks on iOS without any competition. Trouble seems to be brewing for Apple as EU Tech Cheif recently asked the company not to use privacy as an excuse to eliminate competition.

[via WSJ]