ACCC to investigate local mobile ad market

Consumer watchdog's efforts to scrutinise app stores as part of the ongoing Digital Platforms Inquiry comes as Apple delays IDFA tracking change

The Australian Competition and Consumer Commission (ACCC) will start its investigation of the mobile app marketing in Australia, part of its ongoing digital platforms inquiry.

The competition watchdog will examine a range of issues, including the use and sharing of data by apps, the extent of competition between Google and Apple’s app stores, and whether more pricing transparency is needed in Australia’s mobile apps market. It is interested in understanding app store ratings and placement along with how data is used and shared in the app ecosystem, including the data available to Google and Apple as a result of their control of the major app stores.

“We want to know more about the market for mobile apps in Australia, including how transparent and effective the market is, for consumers as well as those operating in the market,” said ACCC deputy chair, Delia Rickard.

This new inquiry comes as Apple delays the introduction of the Identifier for Advertisers (IDFA) restriction on iPhones and iPads until early next year. It was originally set to be introduced with the iOS 14 update coming soon. With the change, users will need to opt in to tracking each time they download an app; whereas at present IDFA tracking in iOS devices, like Google’s equivalent GAID, happens by default and users must opt out at the device-level for all tracking through the settings.

Apple’s planned change has been criticised by publishers, the mobile ad industry and Facebook since its intention to limit attribution was announced. Under the restriction, users will need to agree to share their device’s unique identifier for advertising which allows ad tracking, particularly in mobile apps.

Iterable director of deal strategy, Garin Hobbs, told CMO Apple’s move against IDFA is a symptom of a larger trend of data privacy that will certainly manifest - quickly and globally - towards full data protection. “Marketers need data to personalize, but rather than rely on unstable and unsavory data acquisition models, turn to zero party data to make the most impact,” Hobbs said. 

The battle between privacy and personalisation has historically been a tenuous one: a majority of today’s consumers will turn to brands who personalise their CX, but over 75 per cent of consumers are concerned about their personal data. So how do you bridge that dichotomy? Enable agency when it comes to privacy, builds customer loyalty through transparency, and get creative.”

The computing giant said it’s giving developers more time to comply with the change, although it remains committed to eventually allowing users more say over app tracking. In a statement given to The Verge, Apple said: “We believe technology should protect users’ fundamental right to privacy, and that means giving users tools to understand which apps and websites may be sharing their data with other companies for advertising or advertising measurement purposes, as well as the tools to revoke permission for this tracking.”

Facebook has said it won't try to collect the identifier for advertisers' data and warned advertisers could see their ad revenue halve. The social media giant makes billions of dollars in ad revenue, a large proportion of which comes from mobile advertising. In a company whitepaper, the social media giant said personalised ads are twice as effective as generic ads. 

Eyeing further user privacy protections, Apple will soon require all apps on its App Store to have a privacy notice available detailing the data types the app may collect, and whether that data is linked to the individual or used to track them and privacy practices, including the practices of third-party partners whose code developers integrate into their app.

Lotame COO, Mike Woosley, said the impending IDFA change will do a lot of harm to the app developer space and to independent publishers. “Because Facebook was able to frame the issue in terms of the harm to its media network partners, and not itself, that put a lot of pressure on Apple,” Woosley noted.

“The issue is that Apple knows nearly all consumers would ignore an app-specific IDFA blocking tool as they do the tool it already provides. It goes to that great conundrum that the consumers really just don’t care that much, so Apple has to care for them. Forcing the app providers to collect this specific permission achieves that effect. Ultimately, the more that Apple can constrain the ability of third parties to make money advertising on its platform, the easier it is for Apple to extract its own economic rent from the ecosystem. At its core, that’s what this is really all about," he said.

Follow CMO on Twitter: @CMOAustralia, take part in the CMO conversation on LinkedIn: CMO ANZ, follow our regular updates via CMO Australia's Linkedin company page, or join us on Facebook: https://www.facebook.com/CMOAustralia.


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