France’s competition authority has imposed a fine of $162 million on Apple for its implementation of App Tracking Transparency, deeming it an abuse of the company’s market position.
This surprising decision stems from complaints lodged by a coalition of trade associations representing advertisers who can no longer access user information for personalized advertisements…
Understanding App Tracking Transparency
Apple provides advertisers with tools to track user activity across apps, enabling targeted advertising that is significantly more lucrative than generic ads. Consequently, developers of ad-supported applications stand to gain more ad revenue by utilizing this user data.
In 2021, Apple mandated that apps seek user consent to collect this information via a feature known as App Tracking Transparency (ATT). Currently, apps are required to show a prompt requesting permission for tracking, and unsurprisingly, a majority of users opt to decline.
Feedback from Advertisers and Developers
A multitude of advertisers and developers of free, ad-supported applications raised significant concerns regarding the consequences of ATT, with projections estimating losses in the tens of billions for social media platforms alone.
Complaints have emerged from various nations, with some arguing the situation is unjust since Apple exempts its own apps (which are subject to even tighter scrutiny), while others suggest that declining revenues have compelled developers to increase prices to make up for losses.
Recently, indications pointed towards a favorable outcome for advertisers in France, and as reported by Bloomberg, this has indeed materialized.
The French antitrust authority fined Apple €150 million ($162 million) following an extensive investigation into how the technology giant solicits iOS users’ data and the consequences for advertisers.
What was the issue? The regulator found the pop-up notifications to be excessively complicated.
The Autorité de la Concurrence stated on Monday that requiring apps to present multiple prompts made their usage unduly complex […]
The authority asserted that while the ATT framework itself is not problematic, its execution was deemed “abusive within the context of competition law.”
DMN’s Perspective
Although this decision was anticipated, it remains perplexing. ATT involves essentially one pop-up featuring a straightforward yes/no question. Additionally, Apple provides users with a toggle option (illustrated above) to prevent apps from even requesting permission.
This is particularly strange considering ATT is designed to enhance privacy, and Europe is known for having the most stringent privacy regulations globally. The EU has previously supported Apple’s ATT implementation.
Moreover, the regulator has not clarified what specific actions it wants Apple to undertake!
Apple expressed its “disappointment” with the ruling and noted that the regulator has not requested any particular adjustments to the ATT framework in a statement provided via email.
The size of the fine poses a potential risk of straining France’s relations with the US, particularly following Trump’s characterization of penalties enforced by European regulators as “overseas extortion.”
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Image: A collage by DMN featuring images from Apple and Pawel Czerwinski on Unsplash
