In May 2021, Apple launched the App Tracking Transparency (ATT) feature on iOS, and in the past 18 months, the privacy feature has had an adverse impact on the business of digital advertisers who run targeted ads while the tech giant’s own digital advertising business has flourished.
A new report by the Financial Times reveals that Apple’s hiring rate has increased by four times between 2020 and today and doubled since the launch of the ATT privacy feature for its “fast-growing digital advertising business”.
The iPhone maker has about 250 people on its ad platforms team, according to LinkedIn. According to Apple’s careers website, it is looking to fill another 216 such roles, almost quadruple the 56 it was hiring in late 2020. Apple disputed the figures but declined to elaborate.
And these figures have given rise to the controversy that the tech giant released the ATT feature as a “Machiavellian” plot against third-party digital advertisers to increase its revenue and shrink theirs.
The ATT feature enables Apple to grow its digital ads business and put competitors at a disadvantage
ATT promote takes users’ permission, if they want to allow or decline an app on iOS to track their online activity across third-party apps and websites. As most digital advertisers track users to show targeted ads and earn revenue, they are denied of the data to run such ad campaigns when a user opts out of tracking which most of them do.
Therefore, digital advertisers now argue that Apple is growing its mobile ads business by putting them at a disadvantage.
“Building new ad systems to effectively compete with incumbents with tens of thousands of employees and 10 to 20 years of maturity would normally be an impossible task,” said Alex Austin, chief executive of adtech group Branch. “Unless,” he added, “you were somehow able to disadvantage those competitors on your platform”.
David Steinberg, chief executive of Zeta Global, a marketing technology company accused the Cupertino tech giant of scheming against its competitors to capture a larger share of mobile ads business.
Apple was being “Machiavellian” and “brilliant” by adopting privacy rules that forced rivals to rebuild their ad infrastructure, simultaneously creating an opening for itself to fill the void.
“They could build out (their advertising business) dramatically (and) the ‘air cover’ is they are protecting the consumer’s privacy,” he said.
I believe mobile advertisers are missing the point. Apple is not against digital advertising, the company wants to prevent invasive tracking.
When iOS 14’s privacy updates were launched, it was found that several apps like Facebook, TikTok, Twitter, Snapchat, Instagram, LinkedIn, and others accessed the microphones, and cameras of users’ iPhones and data copied to their clipboard to track them without their knowledge. And App Tracking Transparency feature now prevents such intrusion of users’ privacy.
Furthermore, a study conducted by Researcher Kinshuk Jerath, Ph.D., a professor of Business in the Marketing Division at Columbia Business School and funded by Apple found that the company’s App Store Search Ads business does not benefit from App Tracking Transparency rules and other reasons are behind the success of Apple Search Ads. Customer’s feedback on ATT has been “overwhelmingly positive”.