Your iPhone might soon display more ads across native iOS apps
The most valuable company in the world right now appears to be expanding its advertising business for further revenue growth. By introducing ads in more pre-installed apps on the iPhone and iPad, Apple plans to significantly bump its current annual revenue of $4 billion into the ‘double digits.’ The move is likely to upset iPhone owners who already pay a premium for Apple’s tightly integrated hardware and software experience.
Apple currently has a fairly limited ad implementation on iOS, comprising Search Ads on the App Store as a way for developers to promote their apps, as well as ads inside the first-party Stocks and News app. Weirdly, the latter even serves up ads to paying subscribers of News+, though it is a minor issue in terms of the overall iOS experience.
However, it now looks like Apple’s ad strategy is kicking into high gear, as the company is planning a significant increase in annual ad revenue with an expansion of ads into new places on the iPhone and iPad.
According to a Bloomberg report, the potential candidates for these ads include Apple Maps, Books and Podcasts apps, and even an ad-support TV+ tier. The App Store is also getting more ads soon in the app’s ‘Today’ tab and within download pages of third-party apps.
As for Apple Maps, search-based ads have apparently been tested internally, which seem to follow a Yelp-like implementation that allows paying businesses to be ranked at the top of local listings. For Apple Books and Podcasts, users could see a sponsoring publisher/author show up higher in results, as well as appear in ads placed in other areas of these apps. Apple TV+, meanwhile, could follow the likes of Netflix and other streaming rivals for an ad-supported, cheaper tier with less content.
Bloomberg’s report also highlights Apple’s privacy-focused App Tracking Transparency, and how Cupertino’s implementation of this feature drastically affected revenue of third-party businesses and developers. While the latter have had to re-think their ad strategy because iPhone users tend to opt-out of cross-app tracking, it potentially leaves an unlevel playing field for Apple’s ad business that might spawn a few antitrust lawsuits down the road.
Apple’s potential ad expansion for the iOS ecosystem could also risk cheapening the iPhone brand, where owners tend to spend more for a clean, unobtrusive experience. On top of paying for subscriptions for many of Apple’s existing apps and services, having to see ads on more of the company’s first-party apps will likely make it harder for Apple to justify the iPhone’s premium price point.