Changes in iPhone’s privacy setting signals Apple’s hidden ambition to enter internet advertising space

According to an analyst from RBC Capital Markets, privacy changes in Apple’s iPhones signals that the tech giant may expand into the internet advertising market dominated by Facebook and Google.

An update in April on most iPhones allow users to decide which apps can track user activity; this is crucial information for companies looking aiming to feed users targeted ads and measure the impact of the targeting.

The feature, which Apple calls App Tracking Transparency (ATT), has worried many digital advertising and mobile gaming companies including Facebook, which says it has made it more expensive and difficult for brands to advertise on its platforms.

“We view (the privacy changes) as a sign that Apple may want to compete in global advertising,” said RBC analyst Brad Erickson in a note to clients.

“(Apple) can use data privacy as cover while it invests in a search algorithm behind the scenes,” said Erickson while referring to potential advertising revenue from a Google-like search engine.

“If advertisers had no choice but to fly blind with the loss of signal from Apple, Google-owned YouTube and Amazon’s Connected TV could benefit as advertisers’ next best alternatives,” said Erickson.

In reference to Apple’s potential advertising ambitions, analysts from Evercore ISI said, “hampering third-party advertising” would give it a successful start in advertising. They also noted, ATT was primarily aimed at user privacy rather than monetization.

Categories: Creativity, Entrepreneurship, HR & Organization, Strategy

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