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German media and advertising companies have filed a complaint with the country's competition authority accusing Apple of antitrust abuse in the introduction of the App Tracking Transparency (ATT feature) in iOS 14.5.
The upcoming iOS 14.5 update for App Tracking Transparency will force apps to ask users for permission to track their online activity in order to serve personalized ads. While the move is generally seen as positive for privacy, companies in Germany have sued to prevent a loss of advertising revenue. Nine industry associations filed a complaint on Monday, representing a variety of tech giants and online publishers, including Facebook and major publishing house Axel Springer, according to the Financial Times. The complaint is based on the fact that the changes will negatively impact the mobile advertising industry.
ATT function: “Apps must change their business models”
It is claimed that there could be a 60 percent drop in advertising revenue for app developers once ATT is implemented, as it will be harder for marketers to collect data needed for the more lucrative targeted ads. As a representative of the group claimed Thomas Hoppner of the law firm Hausfeld believes that more apps need to change their business models to charge consumers instead of relying on advertising.
Consumers will be harmed by higher transaction costs. As ad relevance decreases, consumers will have to spend more time searching to find offers that are relevant to them.
The complaint mirrors a similar tactic attempted by lobbying group France Digitale, which filed complaints with France's National Commission for Informatics and Freedom (CNIL) in October and March. The group took issue with the implications of ATT itself, as well as the fact that Apple did not appear to have to adhere to the same system for its own apps and services.
Feature will be mandatory from April 26th
While the complaint triggered an investigation by the CNIL into the matter, it rejected a request to force Apple not to implement ATT itself because the regulator could not find any fault in Apple's approach. As the head of the French competition authority Isabelle de Silva explained:
We cannot intervene just because there might be a negative impact on companies in the ecosystem.
Apple continues to roll out ATT, requiring all apps submitted to the App Store to have ATT enabled starting April 26. Apps that attempt to circumvent ATT will be removed from the App Store. (Photo by Worawee / Bigstockphoto)
