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Comment by rorykoehler | Hacker News Reader

I thought that until I realised Apple also have a billion dollar ads business

The problem is Apple relies on hardware sales. FB's entire business from the top down is ad money. And source for a billion dollar ad business? That sounds way higher than my initial impression. (And google paying to be the default SE is not advertising imo)

https://9to5mac.com/2019/11/15/apple-ad-revenue/

Well..

> Apple’s most recent earnings report revealed that it earned $12.51B from Services in calendar Q3/fiscal Q4, though there is no breakdown on how much of this comes from ad revenue.

Notice the 'could's:

> Samik Chatterjee argued the company could leverage the millions of users who search its App Store and Safari browser daily to generate the stellar growth seen by Facebook and Google in recent years.

> he launch of Apple TV+, coupled with Apple Inc’s foray into digital services, could help the company increase its income from advertising by more than five fold to $11 billion annually

This article is literally just speculation. Actually, it's quoting someone's speculation.

> The report seems highly speculative…

There’s a lot of guesswork there. It’s even worse than that actually, they assume that their advertising operation will grow as Facebook’s. It is extremely implausible under current conditions (no tracking and ads limited to the stores). So yeah, if Apple were Facebook, ads would be important to them.

And even the wildest estimates put it far short on the actual money maker, which is hardware sales. When push comes to shove, if they have to choose between ad and devices, they won’t hesitate long.

I saw a few articles when I searched from the previous year which also projected growth to the $2b number the next year but as Apple bundles it all in services who knows?

At 2 billion it’s < 1% their revenue (265b)

Yes I'm hoping that should be enough to dampen their ambitions

Here's a nice source of revenue from google ($9 billion/year): https://finance.yahoo.com/news/google-reportedly-pays-apple-...

Does Apple's ad business track users though? It seems to me that an ad business shouldn't need to in order to be effective.

It does - it provides advertisers data on which users have downloaded their app after seeing specific adverts.

Please provide links or citations showing what information about a user is shared with advertiser.

This is honestly pretty reasonable. Apple already knows which apps I download and this is made fairly clear (you're logged into the App Store and your account lists all apps you obtained).

Apple also knows which App Store ads I saw given that their server sent them to me in the first place. The ads are (at least for now) limited to the App Store and don't carry over across the web or other Apple apps.

Thus I don't see the problem with Apple using the data they've already got to provide anonymized conversion metrics to app developers.

> advertisers data on which users have downloaded their app after seeing specific adverts.

No it doesn’t.

It provides aggregate statistics on downloads, just like any analytics server.

No data on users is shared.

I see what you mean, but iPhone says are something like 150x that. If privacy concerns weaken even 1%, that wouldn't be worth it. Maybe that's unlikely, I'm not sure.

An ad business that doesn’t rely on accumulating user data for targeting.

Ads do not always mean user tracking.

This looks like simply naive thinking. Without evidence to backup your statement about Apple, everything about it breaks the cardinal rule of the ads business.

Not really.

Google built a super successful ad business on search terms alone, long before they got into user tracking.

Do you have any evidence that Apple tracks users for their ad business - which only sells ads for apps when users search for them?

Check their ad business brief - https://searchads.apple.com/

As requested, evidence of tracking in iPhones - https://www.forbes.com/sites/kateoflahertyuk/2020/11/16/appl...

> As requested, evidence of tracking in iPhones

That isn’t evidence of Apple tracking anything.

IDFA is used by Facebook and ad-tech companies.

Apple are switching IDFA to be Opt-In rather than opt out.

That’s what Facebook is complaining about.

> IDFA

The mechanism for tracking users is already present. What more proof do you need?

Even if you manage to toggle 3rd parties out of your phone. You cannot toggle the Apple out of it.

> The mechanism for tracking users is already present. What more proof do you need?

Evidence that Apple uses it.

The mechanism relies on libraries which send user behavior from other app to Facebook. These are correlated by the ID.

The identifier is not the mechanism. The mechanism is Facebook’s library.

Apple has no such mechanism.

> You cannot toggle the Apple out of it

False.

There is a toggle for the entire feature.

On the contrary—I’m not sure if you’ve ever watched Mad Men, but there are some pretty good examples of ads in there that didn’t use tracking at all.

Calling tracking a cardinal rule of ads is like calling HTML a cardinal rule of communication. Sure it might be ubiquitous now, but if HTML were to suddenly disappear I guarantee communication between humans won’t stop — it would adapt. Tracking isn’t a foundation, it is merely what has worked this past decade or so.

I enjoyed Mad Men. But comparing web advertising today to the 70-80s is disingenuous.

Fact of the matter is, advertising today / web marketing relies on user tracking. I'm yet to see anyone debunk this.

I think what is disingenuous is calling what goes on in the modern internet as 'advertising'

Let's call it what it is -- stalking.

> advertising today / web marketing relies on user tracking.

It’s ‘disingenuous’ to claim that as some cardinal rule.

It’s not - it just happens to be the most popular business fad of the 2010s.

What works in business changes over time. That is a cardinal rule.

My point is that advertising right now uses tracking because it can be used, and it makes money.

But in no way does it need it. We could easily go back to untargeted, reasonably effective ads that appeal to broad markets instead of extremely specific ones.

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