The Bundeskartellamt, Germany’s antitrust authority, has today warned Apple that its App Tracking Transparency framework, which requires app owners to ask for explicit permission to use Apple’s Identifier for Advertisers (IDFA), may fall foul of competition law. The main concerns — which have also been touted by mobile app owners and ad tech companies alike — are that Apple doesn’t appear to apply the same restrictions to its own use of data, and that ATT benefits Apple’s own App Store and advertising revenues.
“For us, it is key that users can make a free and informed decision about whether or not their data may be used for personalised advertising at all,” said Andreas Mundt, president of the Bundeskartellamt. “The question at hand is whether Apple is allowed to apply stricter criteria to other providers than to itself when it comes to requesting such user consent. In our preliminary view, doing so may amount to unequal treatment and self-preferencing, which are prohibited under competition law.”
The warning comes after a lengthy investigation from the competition watchdog, and Apple has now been given a chance to respond to the findings. The announcement however opens up the opportunity for ATT to be ruled unlawful, which would have huge significance for the mobile advertising ecosystem.
Uneven playing field
ATT was positioned by Apple as a move to give users more control over their data. In order to track user activity across different apps and access Apple’s advertising identifier IDFA (which plays a major role in targeting, measurement and attribution), app developers had to specifically ask for permission. The mandatory text at the top of the popup uses fairly negative language, asking for permission “to track you across apps and websites owned by other companies”. This in turn has prompted low opt-in rates from users. Ad tech company Singular claims that opt-in rates sat under 14 percent in Q2 last year.
The Bundeskartellamt says that Apple itself also benefits from tracking user activity across different apps and websites, but that the ATT restrictions don’t apply to Apple’s own products. While users are able to alter Apple’s permissions within their device settings, they’re not faced with the same ATT popup.
“The current design, in particular the wording, of the dialogue for Apple’s own apps makes it more likely that users will consent than that of the ATTF dialogue for third-party apps,” said the regulator.
The Bundeskartellamt also takes issue with Apple’s decision to define ‘tracking’ in a way which only covers data processing for advertising purposes across companies. This allows Apple to exempt its own data practice of combining user data across services for advertising purposes from ATT rules, in a way which may be unfair.
“Apple operates a comprehensive digital ecosystem, which, through its many services and connected devices, the App Store and Apple ID, provides Apple with extensive access to user data relevant for advertising,” said the Bundeskartellamt’s statement. “Apple uses some of these data to offer advertising space for personalised advertising in its App Store, generating significant revenues […] However, the ATTF makes it far more difficult for competing app publishers to access the user data relevant for advertising.”
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