Facebook and Apple have been at odds for several years; Apple announced at WWDC 2020 that iOS will require apps to ask users to opt in to cross-app ad tracking. Facebook spent most of the next few months opposing Apple’s plans and predicting erratic revenue due to the impending changes, but the feature was released in iOS 14.5 in April 2021. Surprisingly, though, a new report from The Wall Street Journal claims that before it all failed, Facebook and Apple is working on partnerships and revenue-sharing agreements.
Apple and Facebook are considering a subscription service that would offer an ad-free version of the platform, reports Journal. And since Apple gets a cut of in-app purchases (including subscriptions), it’s a very lucrative arrangement indeed.
Another arrangement that was discussed and eventually became a point of contention was that Apple cut “Boost Posts,” which basically amounted to paying to put posts in front of a larger audience. Facebook has long Always consider boosting posts part of its ad mix. As pointed out by Journal, small businesses often use boosted posts to reach more people. The problem boils down to Apple saying that boosts should be considered in-app purchases, which will be affected by the company’s 30% cut in revenue. Facebook, on the other hand, insists these are ad products that aren’t subject to Apple’s cuts.
Since the introduction of user tracking changes in 2021, research firm Insider Intelligence claims that 37% of iPhone users have opted for the company to track their activity across apps. Facebook’s (now Meta) revenue growth has shrunk significantly since the changes took effect — last quarter, Meta reported its first revenue decline in the company’s history.
These discussions reportedly took place between 2016 and 2018, and we are a long way from these talks. Apple is doing its best to position itself as a defender of privacy, and Meta…well, Meta is busy making the Metaverse a reality. But at least for now, advertising is the only significant way Meta makes money, so the company will have to continue to adapt to a world where iOS app tracking protection is what most users take advantage of.
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