Forbes reports that major developers say Apple has been secretly buying ads for their apps. While that may at first glance seem like a good thing, the developers say the Cupertino firm’s motive is greed, and that the ads are actually costing developers millions of dollars.
Apple is apparently attempting to drive traffic directly to the App Store, and away from the developers’ own websites. This means users will buy subscriptions as in-app purchases, ensuring that Apple gets its usual 15% or 30% cut of the action.
Apple is secretly buying Google ads for high-value apps to collect potentially millions of dollars in subscription revenue, multiple app publishers have told me. Apple is placing the ads without the app developers’ consent, and Google won’t delete them, they say […]
“Apple is trying maximize the money they’re making by driving in-app purchases that people buy through the Apple Store,” one source, who asked not to be named for fear of retaliation, told me.
“Apple has figured out that they can make more money off these developers if they push people to the App Store to purchase there versus a web flow.”
A secondary effect is that because Apple is creating competition for ads on the websites developers themselves advertise, the Cupertino company drives up the cost of those ads.
Developers say the apps affected are Babbel, Bumble, HBO, Masterclass, Plenty of Fish, and Tinder – all apps with relatively high-priced subscription options.
Some subscriptions are worth hundreds of dollars a year. Those might be for training classes, education, fitness, or dating apps. Apple’s cost to run an ad might be $5-10 for each successful sign-up, and the revenue can easily be $50 or more.
Developers insist that the cost to them isn’t just financial.
When people buy access to a service via a subscription in an iOS app, they are essentially Apple’s customers. For privacy reasons Apple does not provide much information about them to the apps or businesses that run the apps. That means it’s hard to do customer service, address issues, or solve any problems.
Forbes says Apple had not responded to a request for comment at the time of writing.
The report is likely to bring unwanted attention as to Apple’s methods, and it is likely to prompt yet more antitrust on the iPhone maker.