In an effort to increase its revenues from advertising across its services, Apple is ramping up its in-house advertisement efforts. Bloomberg’s Mark Gurman, who tracks Apple’s business activities, reports that the company is looking to boost its advertisement revenues division. It’s not entirely clear how this would work at the moment, but it would likely result in more advertisements across more Apple apps and services.

Ads have had a mixed relationship with the Cupertino company. Steve Jobs, Apple’s co-founder and former chief executive, introduced iAd, a third-party advertising division similar to Google Ads, in 2010. It was in 2016, however, that Apple shut down its third-party ads division internally, as it shifted more resources to hardware-driven revenues, whereas its iAd service did not take off.

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Recently, Apple introduced a feature called App Tracking Transparency (ATT). ATT prevents third-party ads from effectively working since it prevents services from tracking you across apps and the internet. As a result, Meta (than Facebook) ran full-page advertisements in newspapers and warned that Apple’s move would destroy the earnings and revenue models of thousands of small businesses worldwide.

According to Mark Zuckerberg, thousands of small businesses used user tracking to serve effective ads. According to Facebook, taking away the usage tracking feature has been detrimental to third-party ads. As a result of Apple’s ATT feature, Facebook itself has lost billions of dollars in ad-supported revenues.

Ironically, Apple is looking to expand its own ad service to users. According to Gurman, Apple devices are premium hardware that already costs more than average in the industry. Due to this, users may feel short-changed that Apple would still want them to see ads despite paying a premium for hardware.
Besides premium hardware, Apple also charges a fee for its services, such as News+. Even though subscribers pay, they still see ads, which contradicts industry-accepted models of ad-supported ‘freemium’ services or subscription-based premium services.
There is a possibility that Apple may roll out a feature that does not track users across its services. A TV advertisement would not know what content you prefer on Apple News or Arcade. Apparently, preference-based advertisements would only be visible within an app based on the user’s viewing or reading preferences. Apple may also share ad revenue with publishers, but there are no details on this yet.
It will be interesting to see how Apple rolls out such a service in the future. After all, running its own ads after restricting others’ can be a contentious affair.

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