Should Apple Decide What's 'Beneficial' in an Ad?

First published on Technorati

The process of getting an application approved through the iPhone App Review team and into the App Store can be a mysterious one for application developers. Many complain the app review process takes too long, the rules for acceptance are vague, and the reasons for rejection are too subjective. Apple does produce guidelines for submissions, which highlight best practices, tips, and rules to help developers successfully navigate the review process.

Earlier this week, Apple added a new tip about the use of location services for developers looking to get apps approved for the iPhone. According to the App Review team, the iPhone Core Location Framework, the programming interface that enables developers to “deliver information based on their location, such as local weather, nearby restaurants, ATMs, and other location-based information,” is not to be used primarily for targeted local advertising.

The wording in the Apple post continues to secure Apple’s position as content editor, and not just technical reviewer, in the App Store approval process. "If you build your application using Core Location, make sure your app first asks users for permission before you use their location to provide targeted information,” the tip suggests. “Once granted, the information you provide must be beneficial.”

What will qualify as “beneficial”? Apple goes on to clarify, “If your app uses this information primarily to enable mobile advertisers to deliver targeted ads based on 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.”

This comes as important news to the mobile marketing community, although the insight was buried in a series of notes aimed at helping developers. For many advertisers who wish to use mobile applications to engage with customers, mobile location data provides invaluable targeting information.

It’s a delicate balance of providing value versus being invasive, says Pat Binkley, VP of Engineering at mobile developer, Zumobi. Zumobi produces iPhone applications for partners and then monetizes the content with advertising. Binkley goes on, “I think in the case of applications that do not have a local component, you have to balance the perception of invasion of privacy and disrupting the user’s experience for the sole purpose of delivering local advertising to them.”

Apple’s recent purchase of Quattro Wireless, a leading advertising network and mobile marketing platform, has fueled industry pundits’ and software developers’ concerns about the intent and impact of this recent tip posted on the iPhone Dev Center. On Twitter, one software developer, @Oliverbo,  summed it up this way, “That spells trouble: Apple: Core Location Off-Limits for Serving Location-Targeted Ads http://bit.ly/dtNzcC /cc @feedly.” Some, like AppleInsider, believe that through the Quattro platform Apple intends to restrain others from using a feature it plans to keep wholly to itself. Industry analyst Greg Sterling, also known as @gsterling pondered, “Is Apple Hoarding LBS Advertising?”

A December 2009 report published by Quattro Wireless, in partnership with DM2Pro, highlighted the importance of targeting capability to advertisers. When advertisers were asked what they considered the most important criteria for choosing an ad network, the ability to target segments of consumers was listed first.

Advertisers and agencies have been trying to monetize the emerging mobile application marketplace but have yet to broadly embrace one particular revenue generation platform. One digital marketing executive, Holly Brown, SVP of IPG’s MRM Seattle office, expressed concern that Apple is attempting to micro-manage the mobile advertising eco-system. “At a time when it’s more important than ever to engage consumers with relevant value, and to build monetization strategies for application developers, Apple seems to be interfering with the natural evolution of the market created between consumers, developers and brands (advertisers).”

Location targeting is not only a tool to help small regional businesses, like dry cleaners and cafes, promote services, but it also aids in the discovery of national products available locally. Location-based applications often enable national brands to target local promotions at a store level and can help customers find their favorite franchise or store nearby prompting them to visit with a coupon or in-store offer.

Because they add a layer of relevancy to the ad content, advertisements based on location can be more productive for advertisers. Brian Wilson, VP of Marketing at application developer Point Inside, which develops iPhone indoor interactive mobile mapping applications for navigating malls and airports, is supportive of the Apple position. “From our perspective, Apple’s notice only serves to reinforce the value that Point Inside is providing and the methods we’re using to provide it.”

Feel free to post a comment below and tell us what you think. Do you need Apple to decide for you which ads can be localized?