Apple’s recent privacy changes to iPhones are signs it may be looking to tap into an internet advertising market dominated by Facebook and Google, an RBC Capital Markets analyst said.
Since an April software update, most iPhones have allowed users to decide which apps can track user activity – crucial information that helps companies like Facebook serve personalized ads to users and measure their usage. impact.
The feature, which Apple calls App Tracking Transparency (ATT), has worried many digital advertising and mobile game companies, including Facebook, which says it has made it more expensive and harder for brands to advertise on its websites. platforms. Read more
“We see (the privacy changes) as a sign that Apple might want to compete in global advertising,” RBC analyst Brad Erickson said in a client note Thursday night, while beginning coverage of Facebook, Amazon and Alphabet with “outperforming” notes.
Erickson is rated four stars for the accuracy of his internet company earnings estimates and recommendations, according to data from Refinitiv.
“(Apple) can use data privacy as a cover while investing in a behind-the-scenes search algorithm,” Erickson said, referring to potential ad revenue from a Google-like search engine.
If advertisers had “no choice but to fly blindly with Apple’s signal loss,” Google-owned YouTube and Amazon’s smart TV could be advertisers’ next best alternative. , Erickson said.
Evercore ISI analysts also pointed to Apple’s possible advertising ambitions in August, saying “hindering third-party advertising” would give it a good start in advertising. Still, they noted that ATT was for user privacy rather than monetization.
Apple, Facebook and Alphabet did not immediately respond to requests for comment from Reuters.
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