Is Apple Trying to Create a Mobile Ad Monopoly on the iPhone?

A lot of attention has been given to section 3.3.1 in Apple's that developer agreement. That clause forbids apps in the app store that are developed with intermediary programing environments. There is another update in the developer agreement that has the potential to be far more limiting to app developers.

Section 3.3.9 states in part that:

...the use of third party software in Your Application to collect and send Device Data to a third party for processing or analysis is expressly prohibited.

This section states that an application may not include a third party library in your application that collects device data and sends it to another party for processing. The key to this is the "Device Data" in that clause. We can hopefully assume that device data would mean things that relate to a device and not an app. For instance you can't collect the UDID, a unique device identification number, the OS or device version number, and maybe even the location. You are still free to collect and send to be processed app usage data, that the user launches your app at 9am and uses it for 4 minutes for example. What features they use on your app, etc.

While this is restrictive, it does not specifically lock out all analytics and advertising companies. But it does put them at a distinct disadvantage.

Peter Farago, VP of Marketing for Flurry, a leading mobile app analytics company, has had a chance to read over this clause and is looking for further clarification from Apple: "We are seeking clarification from Apple directly. The move appears directed at ad networks, analytics providers and others. The language, as written, would cause Flurry to modify some of what it collects. However, there is no way to understand this fully without working with Apple."

All mobile advertising companies collect data. They collect demographic and usage data to target ads. They also collect data to determine what ads are clicked on. And they collect data about what ads are served. If Apple decides to enforce section 3.3.9 in it's strictest form, this will not allow ad companies to operate in a way that would allow them to be competitive with iAd since iAd doesn't have to abide by these restrictions.

Developer Mark Johnson comments, "Targeting ads raises click through rates - that makes the ad network look like better to it's clients and it allows them to maximize revenue from publisher ad space. Apple is going to launch it's own ad network, that's why they are banning third parties from gathering app usage data - to keep compeating ad networks from using that data for targetting."

This clause seems to create a scenario where Apple has a distinct advantage over other mobile ad platforms. That advantage has the potential to make a huge difference to developers trying to monetize their applications with ads.