Apple has big plans of growing its advertising business

Apple has plans to expand its advertising business before it introduces its new privacy rules for iOS that will make it difficult for rivals to work in that space.

Once Apple's iOS 14.5 rolls out, most iPhone users are most likely to say no to be being tracked by advertisers and apps so this update means some serious implications for how the mobile advertising business works right now. (REUTERS)

Apple is scheduled to roll out its new privacy settings soon, but before that the company has plans to expand its advertising business, thereby making it difficult for rivals to play in the same field. As per a report (paywalled) in the Financial Times, Apple is planning to expand the number of search ads that are available on the App Store. The developers will be able to use these search ads and pay for them to have their apps listed as the top result. For example. If you search for a VPN on the App Store, you will see an advert for NordVPN displayed as the top result; if you are looking for cloud storage, you will see an ad for Microsoft One Drive. Now, Apple is planning to add a second advertising slot to the App Store search page to rake in more advertising revenue.

According to a person in the know who spoke to Financial Times, this new slot will be rolled out by the end of April and will give advertisers a way to promote their apps across the App Store instead of just being restricted to be seen when a user searches for that category of apps. So instead of the ad for NordVPN showing up only when you search for a VPN on the App Store, you will see the ad across searches.

As TechRadar pointed out, after rolling out privacy labels for all App Store apps last year, Apple plans to ban both advertisers and apps from collecting data on users without their consent. With iOS 14.5 rolling out soon, which is expected to happen by the end of this month unless users give apps and advertisers explicit permission to track them and/or collect data, they cannot do so.

Once iOS 14.5 rolls out, most iPhone users are most likely to say no to be being tracked by advertisers and apps so this update means some serious implications for how the mobile advertising business works right now. Apple has said that these changes are being brought in to improve users' privacy, critics have accused the tech giant of using this method to boost their own nascent advertising business. Facebook CEO Mark Zuckerberg told the Financial Times that Apple might say that they are doing this to help people, but “the moves clearly track with their competitive interests”.

Both Facebook and Google, the two biggest names in the online advertising business, use data collected from users to serve them with targeted ads. Apple's iOS 14.5 is going to hurt the way both Facebook and Google function, so it is not surprising that these two are Apple's harshest critics as far as its new privacy settings are concerned.