Analyst: Tighter IDFA privacy rules on iOS spell short-term trouble for in-app ads

Apple's long-promised changes regarding how advertisers can track iOS users are now right around the corner. Starting in "early spring 2021," its ID For Advertisers (IDFA) will switch to an opt-in system and in doing so reduce advertisers' ability to deliver targeted ads on iOS.

With that change now nearly upon us, analysts at Omdia project a 17 percent drop in the value of the in-app ad market on iOS for this year.

For developers with ad-supported free-to-play games out there, this foreshadows a shift in the models favored by advertisers on iOS, or even sees their focus shift away from iOS and toward Android instead.

"Over a third of this shortfall will be revenue lost to other forms of advertising or held back; nearly two-thirds will be revenue redistributed to Android in-app ads, as iOS ads lose almost 60 percent of their premium over their Android counterparts," explains Omdia's Guillermo Escofet.

"The loss of attribution and targetability of iOS ads, resulting from the anticipated nosedive in iPhone/iPad users consenting to being tracked by advertisers, should lead to higher demand and higher prices for Android ads."

While a short-term shift revenue is expected, Escofet notes that it won't be enough to shake advertiser confidence in iOS entirely as the platform tends to attract more user spending than Android—4.7 times more in 2020, by Omdia's count.