Apple made a very controversial change to advertising on the iPhone and iPad last year with its new App Tracking Transparency feature, which lets customers choose whether they want to be tracked across third-party apps for the purposes of targeted advertising.
Now, another change quietly rolled out by the company on Monday could prove just as controversial.
In the company's new App Store Review guidelines published this week, Apple has made a significant change to the way it views digital purchases surrounding advertisements in apps on the iPhone, stipulating they must now be considered in-app purchases.
Boosting revenue
The new 3.1.3 (g) provision in the App Store guidelines covers a few different digital purchases, but notably, Apple specifically refers to "sales of 'boosts' for posts in a social media app" which it says must now be in-app purchases.
This means that 30% of the revenue generated by the likes of Facebook and Twitter for promoting tweets and posts will now go directly to Apple, where previously Apple wasn't entitled to any of this revenue.
That means Apple has taken 30% of this revenue directly out of the pockets of large social media companies that say they're already suffering because of the aforementioned ATT, which has made it much harder to target users with advertising, making ads less effective and less lucrative as a result.
Notably, however, Apple has not extended this change to advertising management apps, so marketers who want to avoid this 30% fee should look to use those instead. "Advertising Management Apps: Apps for the sole purpose of allowing advertisers (persons or companies that advertise a product, service, or event) to purchase and manage advertising campaigns across media types (television, outdoor, websites, apps, etc.) do not need to use in-app purchase," the company states in its new guidelines, noting that "these apps are intended for campaign management purposes and do not display the advertisements themselves."
Facebook has said it is expected to lose around $10 billion in 2022 as a result of the changes, meanwhile, Twitter noted in February it had managed to avoid much of the impact felt by Facebook.
The news comes as Apple prepares to launch more advertising in the App Store from Tuesday, with new adverts coming to the main Today tab in the App Store. The company is also reportedly developing advertising for apps like Apple Maps to be rolled out in the future.
As Apple continues to squeeze rivals in the advertising space with measures like the new designation of social media boosts while pushing further investment in its own advertising platforms, it is sure to draw the ire of large social media companies and possibly government regulators.
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