Apple Banning Location Based Advertising? – We Don't Think So

We recently reported that Apple acquired Quattro, a mobile advertising network. Shortly after the sale of Quattro Apple released a statement saying that apps that requested a users location for the primary purpose of location based advertising would be rejected by the app store.

At first sight this appears to be anti-competitive behavior. Apple recently filed for a patent around location based advertising and their purchase of Quattro makes it obvious that they plan on pursuing this highly engaging targeting method. Over the past week every has been yelling that Apple is the new Microsoft and that their actions are anti-competitive in nature. I do not think we should be so quick to judge.

By the sounds of it, Apple is not going to ban applications that use location information for advertising as long as they provide some other added value, location based service. Only time will tell, but it seems far fetched to think that they would allow apps that use Quattro’s platform to perform location based advertising without a valuable reason to grab the location and not others. What they are trying to do is ensure that people do not get slammed with location requests for no other reason than to be bombarded with advertising.

If this is what Apple is doing, I am behind them 100%. Location based advertising has always been considered the holy grail of the mobile platform, but there is a fine balance between adding value and being annoying. Apple is trying to ensure that their user experience is not compromised by annoyances to the user that don’t actually give them anything useful in return.

For media publishers adding valuable location based content should not be a problem. For example, in order to gain the users location all the publisher needs to do is provide local news, local weather, or local reviews. If you add this type of functionality then you have every reason to grab the users location as you are giving them something in return for their coordinates and can therefore also use that location data for ad targeting.

If this is the case then good on Apple for trying to maintain a high level of user satisfaction. Here at Spreed we will be keeping our eyes on this issue as we currently allow publishers to target users with local advertising, but only do so if we have a good reason to request their location. Only time will tell.

Update:

Here is the official statement from Apple:

If you build your application with features based on a user’s location, make sure these features provide beneficial information. If your app uses location-based information primarily to enable mobile advertisers to deliver targeted ads based on a user’s location, your app will be returned to you by the App Store Review Team for modification before it can be posted to the App Store.

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3 Comments

Filed under advertising, iphone, marketing, mobile, Spreed

3 responses to “Apple Banning Location Based Advertising? – We Don't Think So

  1. Agreed, I think Apple is just trying to figure out how to do location based ads in a way that won’t be a complete annoyance to their users.

    We very briefly tried out the location based ads in our recent game release Bankshot and we found that it woud pop up location requests multiple times a session. Combine that with OpenFeint’s location request and it was a nightmare.

  2. I agree, it seems clear that there must be are relevant “value add”. That way you are not playing the latest time wasting game on the bus then get an ad popup for fried chicken at the joint at the next stop.

    As much as people hate it, ruling the App Store with an iron fist is required (in part) to maintain the brand’s high image. Why they reject for HIG violations (appearance), don’t do multitasking (you’ll blame Apple for bad battery life not the developer of the app that phones home every minute). This is just another example of that.

    With respect to the patent concerns, Apple has many patents that are currently being “violated” without acting on them. The patents are like nuclear bombs, an insurance policy. Everyone knows you have them but you don’t want to use it unless you really have to.

  3. Thanks for the insight Ken! Using the Spreed platform users are only requested to supply their location twice. If they agree both times they are never asked again. Please come back and let us know more about your experiences with location based advertising as you try new things.

    Cheers

    Dave

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