Apple rolls out Search tab ads on the App Store

Apple has rolled out the new ad spot in the App Store, called Search tab ads, in order to boost its ads business. 

Normally, the Search Ads model that Apple uses is based on advertisers’ bidding on keywords, just like Google’s search ads. With the Search tab ads, the company allows apps to capture the attention of customers before they search, with prominent placement on the App Store Search tab, at the top of the suggested apps list. 

Only available as part of Apple Search Ads Advanced, the Search tab ads’ pricing is based on a cost-per-thousand-impressions (CPM) model.

Per an estimate from Cowen & Co., Apple’s app store advertising business is expected to generate around $2 billion this fiscal year.

Apple has rolled out its controversial AppTrackingTransparency framework. Facebook, Alibaba, Unity Software Inc. and Snap Inc. said that Apple’s changes could risk their ad businesses.

In addition, mobile adtech companies including Chartboost, Fyber, InMobi, Liftoff, Singular, and Vungle formed ‘Post-IDFA Alliance’.

Apple also handles antitrust complaints and trials that claim it abuses its dominant position as a gatekeeper of the App Store to insulate itself from competition and disadvantage rival services.   

At the first day of antitrust trial, Epic Games said Apple users and developers “trapped” in the App Store in an anticompetitive marketplace. Last week, The European Commission sent a so-called statement of objections to Apple, explaining how it thinks Apple is abusing its power as a “gatekeeper” for music streaming apps on the App Store, following a complaint by Spotify.

Amidst all these antitrust complaints claiming that Apple is using its monopoly power to control the app ecosystem, making such a move to boost its own ads business seems to further fuel the debate.