Apple, last Tuesday:

Apple Search Ads makes it easy to promote your app on the App Store. And now with new Today tab and product page ad placements, you can drive discovery of your app in more moments across the App Store — when customers first arrive, search for something specific, and browse apps to download.

Upon launching, feedback from the developers of various popular apps and Apple observers shared a common theme. Simon B. Støvring:

With Apple’s recent changes to ads on the App Store, your product pages may now show ads for gambling apps. One of my product pages just did that 😞

Marco Arment:

Now my app’s product page shows gambling ads, which I’m really not OK with.

Apple shouldn’t be OK with it, either.

The App Store has corrupted such a great company so deeply. They make so much from gambling and manipulative IAPs that they don’t even see the problem anymore.

Cabel Sasser:

It is really sad to me that Apple needs to start taking Casino Game Ad Money in order to make their line go up for the shareholders. When Steve introduced iAds and the whole pitch was, “These ads aren’t garbage, you’ll like these ads.” This department shouldn’t exist at all, imho.

Sebastiaan de With:

I know it’s not as easily quantifiable, but Apple is utterly annihilating brand value, trust and goodwill with these ads. How is the revenue possibly worth it?

As a developer, this sucks. As a user, it sucks. As someone who cares about Apple products it’s just profoundly sad.

Federico Viticci:

Can you imagine having $48.2 billion cash on hand and YET still thinking “ah yes, those House of Fun Casino ads will grow our bottom line, let’s do it”.

Dan Frommer, quoting Steve Jobs:

@cabel And then, a year later, while introducing iCloud/MobileMe Mail:

“No ads. We build products that we want for ourselves, too, and we just don’t want ads.”

The gambling/casino-related ads were so dominating the auctions for these new ad slots that they were even being presented at the bottom of the product pages for apps intended to help people with gambling addiction. Other scumminess included ads for “psychic” apps on the product page for Disney+ and ads for hookup dating apps on the pages for marriage counseling apps. You really couldn’t make this stuff up.

Within one day of the new ad slots going live, Apple issued a terse statement:

We have paused ads related to gambling and a few other categories on App Store product pages.

It’s now nearly a week later, and the gambling/hookup/psychic-type ads still don’t seem to be showing up (well, mostly), but it’s also just as hard to see why Apple is selling these spots in the first place. Well, duh, for the money, yes — that’s obviously the only plausible answer. But how much money can these ads be generating? How much can Apple hope they eventually generate? It can’t possibly be enough money to justify the damage it’s doing to Apple’s brand. These App Store ads are like the “Intel Inside” stickers on PC laptops — they’re worth money, but the money’s not worth it. Who’s laughing about those stickers now?

No ads in the App Store, period” would have been a powerful, appealing message. One that Apple could have used to justify its control over all software on the platform and its much-debated mandatory cut of all app and game transactions. “We sell ads in the App Store, but they’re OK because they don’t track you” seems to be the message Apple is going for, but that’s neither powerful nor appealing. It boils down to “Hey, it could be worse.”

Last month The Information published a piece by Wayne Ma on Phil Schiller’s leadership of the App Store. It contained this bit regarding the Today tab, which is effectively the front page of the store (italic emphasis added):

In 2015, App Store employees pitched a redesign of the store to Cue that required hiring and paying for a large editorial staff to write stories about apps and their developers. The redesign was meant to encourage users to visit the App Store every day to discover new apps, rather than having the store act like a vending machine that existed merely to peddle software. Cue wasn’t receptive to the pitch as he didn’t believe it was worth the money, given that the App Store was already performing well, according to a person with direct knowledge of the discussions.

Schiller, however, approved the redesign in his first days on the job, this person said. He believed the App Store had lost a lot of the spontaneity and fun associated with discovering new apps. He thought an editorial team could help bring those qualities back, according to a second person with direct knowledge of the project.

In 2017, Apple launched the redesign, which included new tabs on the App Store called Today, Games and Apps, highlighting various apps and developers. While the general perception among users Apple surveyed after the redesign was that developers had to pay to be featured on the App Store, that wasn’t the case, according to people familiar with the matter. Schiller gave the editorial team the power to select which games and apps to promote or feature on these tabs, without pressuring them to base those decisions on business and partnership goals, those people said.

I was reminded of that last week, when I saw this exchange on Reddit in a thread about these new App Store ad units:

sisco98: “Today tab, which until now has only displayed content handpicked from the App Store’s editorial staff, without any paid placement.” Up to now, I was pretty sure these picks were paid by developers.

spack12: Yeah I always figured those were ads too.

rotates-potatoes: Probably why they created the ad unit. If everyone’s going to assume it’s paid ads, might as well collect revenue from it. Many years ago I had an app featured in the app store. Was awesome, like 10× sales overnight. Was a complete surprise to me when it happened.

Apple is actually scrupulous about labeling paid placements as “ads”, and using different background colors for them. One can certainly argue that ads should be even more clearly demarcated, but if you look for it, it’s always clear. But people don’t look. If the message were clear — that there are no ads or paid placements in the App Store, period — people might learn. But if the message is that there are ads, but not many, but now there are more than there used to be, and but if you look closely you’ll see that the ads have a blue background and a small “ad” label — almost everyone is going to assume that anything that might be an ad is an ad and the whole App Store is pay-for-play all the way down.

Back in 2014, the front page of the Privacy section on Apple’s website was an open letter, signed simply by “Tim”. Here’s an archived version from The Internet Archive; here’s one from Cook’s letter read in part:

A few years ago, users of Internet services began to realize that when an online service is free, you’re not the customer. You’re the product. But at Apple, we believe a great customer experience shouldn’t come at the expense of your privacy.

Our business model is very straightforward: We sell great products. We don’t build a profile based on your email content or web browsing habits to sell to advertisers. We don’t “monetize” the information you store on your iPhone or in iCloud. And we don’t read your email or your messages to get information to market to you. Our software and services are designed to make our devices better. Plain and simple.

Apple’s commitment to privacy is no less today than it was then. One can well argue that it’s even stronger. But there are aspects of Apple’s position on advertising eight years ago, unrelated to privacy, that don’t square with Apple’s position today. Cook has repeated variations of that “you’re not the customer, you’re the product” mantra umpteen times since 2014. But how are these ads in the App Store not making users the product, and advertisers the customers?

It remains true that Apple is not monetizing the information we store on our devices or in iCloud, but they’re clearly monetizing our attention and their exclusive hold on that attention for all apps and games for iOS. Apple’s business model is no longer the straightforward selling of great products, and these new ads in the App Store are not designed to make anything better other than Apple’s Services bottom line.

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