Apple plans to bring in more ad revenue in different iPhone and iPad apps by expanding the scope of advertisements seen in the App Store and in Apple Maps, Apple Books, and more, according to a new report.
In his latest Power On newsletter, Bloomberg's Mark Gurman stated Apple will be significantly expanding its advertising business over time. The reliable analyst believes the Cupertino tech giant will bring search ads to Apple Maps, as it's reportedly already been explored. It would allow businesses to pay to be more prominent in search results.
Apple Books and Apple Podcasts could also be getting the advertisement treatment, letting publishers pay to have their work appear more in searches and throughout the app. Using ads throughout apps isn't anything new, as users already see display ads in the Apple News and Stock apps, with the former giving publishers a portion of ad revenue.
Not to mention the App Store. Here, apps for iPhone, iPad, and Mac are promoted if developers pay to have their apps shown more prominently. The question is: if Apple already has advertising spotted around its suite of apps, why does it need to expand? As Gurman notes, its to do with a major revenue hit with all kinds of companies, and Apple wanting to increase its ad revenue to the (billion dollars) double digits.
App Tracking is Apple's undoing
Last year, Apple introduced App Tracking Transparency, allowing iPhone and iPad to block ad tracking across other companies’ apps and websites. It's a privacy feature that lets users opt out of having their data collected by various apps, which has been a hit with users. In fact, Gurman states that 78% of iOS 15 users disabled ad personalization. (By the way, here's how to find out which apps track you on your iPhone.)
However, you can still be tracked in Apple's apps. As the report points out, the app tracking feature “does not follow you across apps and websites owned by other companies,” Apple states. Still, ad revenue is a big commitment Apple wants to pursue, and there's be a restructuring of sorts. VP of advertising platforms Todd Teresi is again reporting to Apple Services head Eddy Cue, with Teresi previously reporting to Cue before 2016 when iAd was a thing (a now discontinued mobile advertising platform).
Teresi aims to ramp up ad revenue annually from $4 billion to something in the double digits, hence the increase in ads across iPhone and iPad. In an earnings call, CEO Tim Cook still called the state of its ad business "great," but there are a lot of pain points Apple needs to sort out to boost its ad revenue without upsetting customers.
The good news is Gurman doesn't anticipate Apple putting ads inside of third-party apps for the time being, but more ads are coming. Is it fair to put ads in apps on an iPhone that could cost around $1,000? Let us know your thoughts on Twitter and Facebook.
We may not see this transition anytime soon, but we will see the iPhone 14 lineup possibly as soon as this September, and it's looking like the Pro models may get a $100 price increase.