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Apple's plan to integrate ads into apps is 'natural progression': analyst

·Senior Reporter
·2-min read

Apple (AAPL) is reportedly planning to integrate ads into its apps – a move that's an intuitive next step as the company looks to drive new revenue, IDC’s Mobile Device Trackers Program Vice President Ryan Reith told Yahoo Finance Live (video above).

"There's always a risk of alienation coming in, regardless if you're a premium player or a low-end player, but I think with the direction that Apple has been going with a lot of their services... I think it's a natural progression," Reith said.

Apple – which already shows ads in some of its apps – already generates about $4 billion from its ad business. In July, the company revealed that it would bring more ads to its App Store, including in the prominently featured "Today" tab.

Apple shares are up about 17% over the last twelve months, and up approximately 18% over the last month.

A customer tests a smartphone during the launch of the new iPhone XS and XS Max sales at
A customer tests an iPhone (REUTERS/Tatyana Makeyeva)

Meanwhile, Apple's ad-related feature has hit other companies

Ads have been the center of a lot of controversy for Apple. Many app providers, including Facebook-parent Meta Platforms (META), have said a new iPhone feature – called App Tracking Transparency – has led to major hits on their bottom lines.

Apple CEO Tim Cook recently spoke about ads in the company's latest earnings call.

"We're trying to empower the user to own their data and make their own choices," Cook told analysts. "In terms of us selling ads, we have a search ad business across the App Store that we believe represents a great way for discovery for small and large developers."

Though this move has been in the works for some time, Reith sees Apple moving thoughtfully and cautiously.

"We've seen companies sort of run before they walked, and they've landed in legal troubles and user troubles," he said. "I have to believe that they're looking at all that stuff very, very closely and I guess we'll see how it sort of all unfolds."

Allie Garfinkle is a Senior Tech Reporter at Yahoo Finance. Follow her on Twitter at @agarfinks.

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