Meta to suffer $10 bn hit as Apple seeks 30% share in advt revenues

SAN FRANCISCO: Apple-Meta war over App Store has intensified with new updates that require iOS developers to give Apple 30 per cent cut on the sales of ‘boosts’ for posts in a social media app.

The move will affect Facebook and Instagram which let people pay to boost the reach of their posts, it was reported by the media.

It is also the first time that Apple has directly taxed advertising in iOS apps.

“Apple continues to evolve its policies to grow their own business while undercutting others in the digital economy,” a Meta spokesperson was quoted as saying in the report late on Tuesday.

Apple previously said it didn’t take a share of developer advertising revenue, and “now apparently changed its mind”.

“We remain committed to offering small businesses simple ways to run ads and grow their businesses on our apps,” said Meta.

Paying to boost posts is a common feature across Meta’s family of apps, all well as Twitter and Chinese short-form video platform TikTok.

In a statement, an Apple spokesperson said the App Store has long taken a cut of digital goods and services.

“Boosting, which allows an individual or organisation to pay to increase the reach of a post or profile, is a digital service -- so of course In-App Purchase is required. This has always been the case and there are many examples of apps that do it successfully,” the Apple spokesperson was quoted as saying.

Apple’s privacy changes in the App Store called App Tracking Transparency (ATT) have already given a boost to its ad business, and the iPhone maker has managed to break the Facebook-Google advertising monopoly in the online search market.

Meta founder-CEO Mark Zuckerberg has admitted Apple iOS privacy changes will cost the company a whopping $10 billion in 2022.

Meta has also accused Apple of favouring Google over app-based platforms like Facebook with its privacy policies.

Apple’s iOS 14.5 update, released in April 2021, came with an ATT feature that has affected digital advertising for tech giants.