Get ready to see more iAdvertising

What is the one thing you’re missing on your Apple devices?

If you said “a headphone jack,” you’re unfortunately out of luck. But if “more advertising” is an idea that gets you jazzed, then we have good news: Apple is preparing to beef up its ad business and could roll out more placements across pre-installed apps like Maps, Books, and Podcasts.

Why it matters: Premium products, not advertising, have been Apple’s bread and butter since Steve Jobs set the company’s direction in the late 1990s. Expanding its ad business would be a significant shift in Apple’s strategy.

Catch up: Last year Apple tossed a grenade into the digital advertising world when it launched App Tracking Transparency (ATT), that little popup that asks you if you want to let an iOS app track your activity.

  • ATT forced iOS apps to ask users for permission to track their activity across other apps and websites. Unsurprisingly, most people said “thanks, but no thanks.”
  • That change made digital advertising, which relies on tracking to target people with personalized messages, less effective and (by some estimates) will cost Facebook more than US$12 billion this year.

But Apple can get around those tracking restrictions. ATT does not stop companies from tracking people across their own products and services, and Apple has lots of data on its users from its own ecosystem. 

  • For example, Apple knows about every in-app purchase its users have made across all iOS apps, and could target ads to them based on that data. 

Now Apple appears ready to capitalize on that advantage, testing search advertising in its Maps application and hiring someone to lead the development of a self-serve ad buying platform.

  • Apple is also likely to expand advertising placements in its News and Podcast apps, more parts of the App Store, and Apple TV Plus, according to Bloomberg’s Mark Gurman.

Bottom line: Advertising may be an irresistibly tempting line of business for Apple, but it comes with the risk of tarnishing the privacy-centric, high-end brand it has spent decades building.