• by August 31, 2020

Apple is getting close to releasing the next version of the software that runs the iPhone, which will give people more control over the data they share with apps. Those changes will affect advertising revenue for publishers, but shouldn't be considered a death knell for the industry.

Apple announced these pending changes more than two months ago at its yearly WWDC conference for software designers, leading to speculation that it would drain billions of dollars out of the growing market for in-app advertising. Facebook last week warned that the changes may render its Audience Network, which helps advertisers target app users using the social network's consumer data, useless on Apple's devices.

At issue is Apple's Identifier for Advertisers (IDFA), which is a random number that the company assigns to its devices to help track user activity in apps and websites. IPhone users already can limit that tracking by changing their privacy settings, but Apple's iOS 14 mobile operating system brings greater attention to it.

Any time an iPhone user installs an app that seeks IDFA information, a pop-up will appear asking for permission to share the identifier. Most people won't want to be tracked, as Facebook warned last week, limiting the effectiveness of the technology.

Without IDFA tracking, publishers may see a 40% decline in ad rates in iPhone apps, Sheri Bachstein, global head of consumer business at Weather.com's parent company, told The Wall Street Journal.

Concerns about declining ad rates are legitimate, especially for publishers dependent on programmatic platforms to sell their ad inventory. Audience-based tracking supports an entire ecosystem of digital advertising that also faces the threat of losing third-party cookies as Google ends support for the tracking technology. Apple already had gradually restricted the use of third-party cookies in its Safari browser, while Mozilla's Firefox limited their usage last year.

However, publishers still have an opportunity to emphasize their strengths in contextual targeting and developing audience profiles with first-party data. By asking readers to register or pay for a subscription, publishers can use login information to track visits. While that won't help advertisers retarget audiences among a variety of apps and websites, tracking technology continues to evolve in ways that protect consumer privacy while also giving publishers an opportunity to monetize their content.