Like practically every other streaming network out there, Apple can’t seem to stay away from taking a big bite of the advertising pie that’s lingered uneaten since the dawn of TV streaming services.
As first reported by Digiday based on multiple anonymous media agency executives, Apple’s looking at new ways to monetize its original content with ads. Reportedly, Apple’s VP of Advertising Platforms Todd Teresi has been making the rounds to different media agencies and network execs in order to sell ad time on Apple TV.
Apple’s latest plans are to use its original content, such as their stalwart feel-good show Ted Lasso, to sell more ads using a demand-side ad platform. A DSP, as it’s called in industry jargon, is a system that allows advertisers to buy ad time with the help of automated systems to put ads in front of the right kinds of eyeballs, all based on user metrics. Reportedly, Teresi was telling agency execs they were capable of building a DSP, though they currently do not have one.
According to these reported conversations, agency execs expect Apple wouldn’t be rolling out ads on Apple TV until 2023, since the company wasn’t asking agencies to put money down for this year, at least. One ad exec said they expect another meeting in November. The agency execs also added that Apple TV’s ad load might not be as bad as some other streaming networks like Hulu, since the company’s revenue is much more “diversified.”
Apple does have an advertising deal with some major league sports on TV+, with its Friday Night Baseball ad deal worth $85 million annually, according to Forbes. The company has said ads are not coming to other Apple TV+ programming.
Apple declined to offer Gizmodo a statement on the record.
Still, any new potential advertising scheme would put it in the same leagues of the many streaming competitors who have sunk to offering ad-based and ad-free subscription tiers. HBO Max is thinking about its own advertising models while Disney+ and Hulu recently shifted the pricing models for both its new and old ad tiers. Netflix is also crafting its ad-supported subscription, which latest reports put it at four minutes of ads per hour of content.
But of course, Apple wasn’t going about it the same way that most other streaming services have recently, at least not at first. Digiday’s report mentioned that Apple first pitched a kind of search-based ad platform, one that would apparently restrict itself from sharing user data and would resist creating a DSP. This sounds much like how Apple already advertises to users on its App Store.
Ever since Apple started cracking down on privacy rules for third party apps within its broad app empire, advertisers have had a much harder time on iOS devices. When the tech giant started allowing customers to decide whether apps can track them across apps and websites, it stymied marketer’s ability to unleash targeted ads.
That has left the door open for Apple, which according to an August report from Bloomberg has been looking to expand ads on iPhones and iPads, more than just display ads on the Apple Store with more advertising in its own apps like News and Stocks. According to Apple’s earlier quarterly earnings, Apple’s advertising and subscription revenues were on the rise, growing by 24% into the new year. These services increases have remained steady as far as its last quarterly earnings report.
Of course, while Apple restricts other apps from abusing user data, the tech giant itself is more than willing to use that data it has on users for more targeted advertising in its still-limited capacity, according to Bloomberg. Though users can disable ad personalization to some extent by changing Privacy and Security toggles in their settings app.