By limiting iOS apps' ad tracking capabilities, Apple could see increased commissions from IAPs and subscriptions if developers start charging for apps
as every company involved in advertising will be forced to learn the new rules https://www.ft.com/... Neil Shah / @neiltwitz : Great reporting! Software has been eating the world but nothing is foolproof & ad-tech companies will find holes to target users. Great to see @Apple fight for the privacy but also have full control over the monetization & not leaving money on the table with 1Bn affluent base. https://twitter.com/... Patrick McGee / @patrickmcgee_ : It's taken me a while to understand this but @facebook is unlikely to be hurt by Apple's move. Yes, they need to rebuild their ad infrastructure b/c attribution becomes difficult, but 1st-party data now becomes paramount. Facebook has 2.7bn users. They will thrive. Patrick McGee / @patrickmcgee_ : Bigger is better because of the IDFV, or ID for Vendors, which app developers still get when users opt out of IDFA. It's a string of numbers that are consistent among apps with the same owner. Someone like @zynga with ~500 apps in the App Store likely comes out swinging. Patrick McGee / @patrickmcgee_ : In the scenario where groups successfully get around Apple's rules, then its privacy push becomes a marketing gimmick - the illusion of privacy, not the real thing. It's not clear (yet) Apple is prepared for the massive auditing to come. Patrick McGee / @patrickmcgee_ : In addition to entrenching big companies, the risk for Apple is that it may have created an enforcement nightmare. The digital ads industry is bigger than Apple, by revenue. Some will die. They won't die quietly. They'll circumvent, undermine in all kinds of ways. Patrick McGee / @patrickmcgee_ : That's why @Google's reaction was to shrug. It has a massive trove of data on its users. Google does not even plan to prompt its iPhone users about being tracked — instead it will cease to rely on a user's IDFA altogether Zach / @zachshakked : I think one thing Apple underrates - all the big companies driving App Store revenue can afford to build web checkout flows. People run app ads because they work. If they stop working b/c of tracking - spend will shift to web-based checkout. All the big players do this already. Patrick McGee / @patrickmcgee_ : Losing access to third-party data is damaging to Google and Facebook, but if all of their rivals lose that access, too, then Whoever has the Most First-Party Data Wins. And that's Google and Facebook. (Also, and you'll be shocked by this: Apple) Patrick McGee / @patrickmcgee_ : Apple's policy does nothing about first-party data, so when an iPhone owner uses Google Search, Maps, Chrome, Gmail or YouTube, Google can still use that information to build ad profiles, unencumbered. Patrick McGee / @patrickmcgee_ : Rival @AppLovin is doing the same. It purchased @adjustcom for $1bn. CFO Herald Chen told me that Apple's privacy push should help it at the expense of rivals. “We believe having access to that first party data will enable us to manage through these changes rather well.” Patrick McGee / @patrickmcgee_ : Glu realised the implications of Apple's privacy push earlier than most. Within weeks of Apple's announcement in June '20 it held a board meeting to discuss how it might “combine scale to address the business model challenges posed by the pending release of an Apple iOS update.” Patrick McGee / @patrickmcgee_ : Obtained documents from Tencent explaining how CAID and QAID work. The reason for its own IDFA solution, per someone familiar, is WeChat is big enough to do this on its own — 1.2bn users. It doesn't need the China Ad Association. Eric Seufert / @eric_seufert : 8/ So what does a developer do? Ingratiate themselves with Apple with a non-freemium model and hope for featuring? “Move to the middle” and build freemium products that can be efficiently marketed in the ATT environment? Go subscription? Paid access? https://mobiledevmemo.com/... Eric Seufert / @eric_seufert : 7/ Apple seems to believe that a degradation in ads relevance will drive more people to the App Store for discovery. I believe this is true, but it's sub-optimal because App Store distribution mostly doesnt prioritize revenue (vs. ads-based distribution) https://mobiledevmemo.com/... Eric Seufert / @eric_seufert : In an interview with Kara Swisher ahead of the iOS 14.5 public launch, Tim Cook described the App Store as an “economic miracle.” It seems hard to decouple that miracle from the freemium model, which is the App Store's economic engine—and is fundamentally threatened by ATT (1/X)
Context & Ripple Effects
The arc here starts in mid-2020, when Apple announced that its Identifier for Advertisers would become opt-in under iOS 14 — a privacy win for users and, as the Forbes coverage noted, a big loss for marketers dependent on tracking mobile ad spend (IDFA going opt-in). This FT analysis adds the second half of the ledger: if ad targeting degrades enough that free, ad-funded apps stop penciling out, developers may pivot to charging upfront or via subscriptions — which routes back through Apple's in-app purchase commissions on what the article describes as a billion-plus affluent user base.
The competitive texture matters too. Publishers like Zynga responded by acquiring or building their own ad tech to create first-party data pools Apple can't reach (first-party walled gardens), Glu convened its board over the business-model hit, and AppLovin paid $1bn for Adjust — all evidence that ATT is forcing an industry-wide re-architecture of measurement. Meanwhile Apple itself is not standing outside the ad market: its own Apple Advertising was on by default in iOS 14 while competitors had to ask permission, and it has since expanded App Store ad placements.
First-order effects
- Developers whose ad economics depended on IDFA face a choice between accepting worse monetization and shifting to paid apps or subscriptions — the latter handing Apple its usual cut via IAP and subscription commissions.
- Facebook must rebuild its ad infrastructure around signals other than IDFA on iOS; Patrick McGee's read is that it is unlikely to be fatally hurt by the move, though every company in advertising is forced to learn the new rules.
Second-order effects
- Ad-tech suppliers consolidate to survive the loss of IDFA — AppLovin's $1bn acquisition of Adjust and publishers like Zynga building in-house stacks both point to measurement moving behind first-party walls.
- Apple captures the demand that leaks out of third-party tracking twice: once through IAP commissions if apps go paid, and again through its own ad inventory — it expanded App Store ads from Search into the Today tab and product pages (App Store ads expansion) while rivals operate under stricter permission prompts.
Third-order effects
- If the pattern holds, the Google–Meta duopoly in digital advertising gives way to one where Amazon and potentially Apple are major forces, as the Stratechery review argues — with the gatekeeper of the platform also becoming a principal seller of ad inventory.
- The deeper structural question is the App Store's take rate: critics argue the store retains users because it is the only choice rather than because it offers exceptional distribution (distribution-by-default critique), so a privacy-driven push toward paid models concentrates more developer revenue under a commission structure already under regulatory scrutiny.
The trend: Mobile privacy regulation is shifting app monetization from open, third-party-tracked advertising toward platform-controlled channels — paid apps, subscriptions, and the platform's own first-party ad inventory — concentrating pricing power with Apple.