Apple and Facebook have been at conflict for a while; at WWDC 2020, Apple stated that iOS would require apps to ask users to opt-in to cross-app advertising tracking. Facebook spent a significant amount of the following months criticising Apple’s plans and projecting revenue volatility as a result of the changes, however the feature was actually introduced in iOS 14.5 back in April 2021. Surprisingly, a recent article from The Wall Street Journal indicates that Facebook and Apple were negotiating a cooperation and revenue-sharing agreement prior to this whole thing happening.
A subscription service that would provide an ad-free version of the site was something that Apple and Facebook were reportedly discussing, according to the Journal. It might have been a very lucrative deal indeed because Apple takes a percentage of all in-app transactions, including subscriptions.
Apple getting a portion of “boosted posts,” which essentially means charging to put a message in front of a wider audience, was another arrangement that was explored and turned out to be a source of disagreement. The Journal notes that small businesses frequently use boosted posts to reach a wider audience because Facebook has traditionally regarded them as a part of its advertising offering. It all came down to Apple’s position that boosts should be treated as in-app purchases due to the company’s 30 percent revenue cut. On the other hand, Facebook argued that those were promotional items that weren’t subject to Apple’s cut.
Research company Insider Intelligence asserts that since implementing adjustments to user-tracking in 2021, 37% of iPhone users have chosen to allow corporations to follow their behavior across applications. Since the shift took effect, Facebook (now Meta) has suffered a considerable slowdown in the development of its revenue, and last quarter, Meta reported the first revenue decrease in its history.
We are far away from these conversations because they allegedly took place between 2016 and 2018. While Meta is working hard to establish the Metaverse as a real thing, Apple is making every effort to promote itself as a privacy defender. But for now at least, advertising is the sole significant source of income for Meta, so the business will need to continue adapting to a reality in which most users make use of iOS app tracking protection.