Meta Platforms Inc. unveiled new guidelines designed to assist small businesses advertising on Facebook and Instagram, focusing on strategies to navigate fees imposed by Apple Inc.
According to the guidance released on Thursday, Meta is recommending that businesses purchase ads via a web browser instead of through the iOS apps of Facebook or Instagram. This approach aims to help them sidestep an Apple commission that is set to come into effect this month.
Apple’s updated policy mandates that advertisers utilize its In-App Purchase feature for payments made to “boost” social media posts, a function that enhances visibility. This change could result in Apple taking up to a 30% commission on app-related transactions, which could significantly impact Meta’s advertising revenue.
The policy shift, initially announced by Apple in 2022, heightened tensions between the two technology giants, who have become notable competitors in recent years. At that time, Meta criticized Apple for “undercutting others in the digital economy.” CEO Mark Zuckerberg has repeatedly expressed concerns regarding Apple’s control over its App Store.
In response to the backlash, Apple asserted on Thursday that classifying boosts as In-App Purchases aligns with its established App Store policies. The company noted that over the past year, it engaged in extensive discussions with Meta concerning the boosting policy, providing sufficient time for compliance.
“We have always required that purchases of digital goods and services within apps must use In-App Purchase,” Apple stated. “Boosting, which enables an individual or organization to pay for enhanced reach of a post or profile, is a digital service — so In-App Purchase is indeed required. This has been consistent, and many apps implement it successfully.”
Apple CEO Tim Cook has publicly criticized Meta’s privacy practices, particularly its reliance on user data for ad sales. Past adjustments made by Apple have negatively affected Meta’s revenue. For instance, a 2021 change to iOS that restricted third-party data collection resulted in an estimated $10 billion decrease in ad revenue for Meta.
The policies enforced by Apple have faced scrutiny from various companies, including Spotify Technology SA and Epic Games Inc., which have asserted that the App Store regulations are inequitable. Although Apple has recently adapted its practices in Europe to comply with new laws, these revisions have also sparked significant backlash.
The new advertising policy will first be implemented in the United States and is expected to launch in other regions later this year. Additionally, the changes will require advertisers to make upfront payments for ads purchased through iOS apps. Meta indicated that this shift will predominantly impact smaller advertisers, many of whom rely on boosted posts as their sole advertising method.
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