Apple is accused of shopping for advertisements for subscription-based apps for greater fee, the corporate replies

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According to Forbes, Apple has been accused of buying ads for popular third-party subscription-based apps like HBO and Tinder in order to get more cash out of the commission it makes on in-app purchases.

Forbes has reported that Apple has been buying subscription-based apps for Google ads like HBO, Masterclass, Babbel, Tinder, Plenty of Fish, and Bumble for over two years. The report says that Cupertino giant is doing this to make more money as it (Apple) makes more money from the commissions it makes on the subscription-based apps. A marketer said in a statement to Forbes that the tech giant “appears to have been promoting it for attempting to circumvent the App Store’s guidelines”.

It claims that the ads do not “reveal” that they are from Apple and lead the user to the App Store without their consent. It takes the user to the App Store instead of the brand’s login website, Forbes has accused Apple. A source close to Forbes said:

Apple tries [to] Maximize the money they make by promoting in-app purchases that people buy through the Apple Store. Apple found that they can make more money from these developers by pushing people into the app store to buy versus a webflow.

Ads placed by the brand usually take the user to the page that would encourage them to sign up online rather than the app store. For example, if you sign up for YouTube Premium through the iPhone app, you will be charged more (because Apple takes a commission from Google) than if you did through the company’s website. The report accused Apple of directing users to the App Store so it could charge 15% or 30% of the subscription’s earnings.

In addition to buying ads for monetary purposes, the report also accuses Apple of paying more for their ad spaces because of this.

If Apple is buying ads for HBO Max to get HBO customers to buy the service in-app, it means HBO will have to spend more than Apple to get the top spot and high visibility. This increases the cost of customer acquisition: a significant problem for high-growth companies that rely on sophisticated marketing models that offset the cost of customer acquisition with the funds available for advertising.

Apple answers

Apple defends his stance

After these allegations were made by Forbes, Apple defended its stance. The company says the “developers are fully aware” of the ads it has run on their behalf. The company says it is promoting products that have been on its app store for more than five years. The company says it’s no different from retailers who run ads for products that are selling well. In fact, the company says it is “given conventional rights” to do so.

The company says the ads it served had over 70 billion impressions in 2020. It says it contained over 130,000 apps from the App Store and that it is currently “spending on supporting” over 100 apps by promoting them on platforms like Google, Snapchat, YouTube, TikTok, and Twitter.

Eventually, the company continued to defend its brand by saying it is “committed to providing developers with the resources” they need to be successful on the App Store.

: MacRumors

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