Advertising, Monetization, and Market Share under Apple’s App Tracking Transparency

Abstract

The Apple App Store has become the dominant platform for digital distribution on iOS, integrating diverse monetization models such as paid downloads, in-app purchases, subscriptions, and ad-based hyper-casual formats. However, Apple’s App Tracking Transparency (ATT) has reshaped advertising dynamics by reducing cross-app attribution and increasing customer acquisition costs. This study examines how advertising expenditures translate into sustainable market share across monetization models under ATT constraints. Using quarterly panel data from 2019 to 2024, the analysis applies voice share and market share metrics, supplemented by Herfindahl-Hirschman Index and Lorenz curve indicators. Results show that subscription and freemium/IAP models benefit from high retention and ranking persistence, allowing advertising to drive long-term share growth, whereas hyper-casual games experience short-lived acquisition effects. Apple Search Ads, as a first-party channel, helps stabilize baseline share compared to external paid media. Policy implications include building budgets based on lifecycle-specific share-of-voice targets, aligning media spend with content releases, and preventing “bubble share” through centralized monitoring. The study offers a unified framework linking short-term advertising elasticity to long-term market concentration, providing insights for advertisers, developers, and policymakers navigating the privacy-driven digital advertising environment.