Tapjoy CEO: a single line of code could solve promo problem with Apple
Tapjoy chief executive Mihir Shah said in an interview that a single line of code could solve his company’s dispute with Apple over the use of certain kinds of promotions for mobile games.
That single line could stop incentivized app downloads from being counted toward Apple’s top rankings list, Shah said. So far, Apple hasn’t responded to Tapjoy.
Apple has communicated that it is concerned that incenting users to download apps, as Tapjoy has done as one of its major businesses, has led to a manipulation of the top rankings for mobile games on Apple’s App Store. So Apple banned the incentive ads a few weeks back.
Tapjoy and Apple have held talks on the ban during the past few weeks, but Apple’s hard-and-fast ban on “pay per install” incentive promotions remains in place. Apple reportedly felt that developers using Tapjoy and other incentives were unfairly gaming the system and hurting the quality of the game rankings.
But Tapjoy said such incentivized promotions are common and that their use has enabled game developers to create a predictable and stable business on a platform that has a lot of competition.
Shah met with Apple to try to convince the company to allow a limited amount of pay-per-install promotions, with a cap that prevented developers from buying their way into the top 25. But Apple disallowed that kind of compromise, according to Tapjoy. Then Shah proposed the single line of code change. Apple did not respond to that suggestion.
“We have a simple fix for this problem,” Shah said. “If this is all about the top charts, we can solve it with that line of code. I am hoping this is all a misunderstanding.”
The result of the change could be disastrous for Apple’s game developer ecosystem, since pay-per-install has become a big part of the business. Glu Mobile, a publicly traded company, highlighted the ban’s financial impact in a statement last week.
As we reported yesterday, Tapjoy surveyed 496 iOS (iPhone, iPad etc.) developers that have used its mobile app distribution service. Almost half of those have reported an increase in user complaints about the inability to earn in-game currency by installing other apps. A quarter of the respondents said they are receiving “way too many” user complaints about the problem.
“It’s clear that the effects on developers and users have been pretty telling,” Shah said. “Early on, Apple was a huge proponent of innovative developers and it encouraged those developers to make big investments in its platform. Unless there is something we are missing, they now seem completely uninterested.”
The number of developers who saw their game usage decrease after the Apple policy change is eight times higher than the number who saw game usage increase. And the ratio was 15 to 1 for those who saw revenues decline versus those who saw a revenue increase. At least two-thirds of the companies surveyed said that 20 percent or more of their revenues came from the pay-per-install model. Many said that pay-per-install generated 60 percent or more of their revenue.
Last month, developers found out that Apple was rejecting their new pay-per-install apps and updated apps because of its concerns that the apps violated one of the App Store rules. In a pay-per-install app, a user is encouraged through an incentive to install another app. The developer of the app that gets installed shares revenue with the original app that steered the user to make the install, so it is a kind of advertising program. And it has been a lucrative one at that. The system allows developers to distribute their apps much more widely than they otherwise could.
But when Apple tweaked the way it calculates App Store rankings a couple of months ago, it also changed its stance on pay-per-install apps, for a largely unexplained reason. Developers have been directed to section 3.10 of the Apple developer program license agreement, which says, “Developers who attempt to manipulate or cheat the user reviews or chart ranking in the App Store with fake or paid reviews, or any other inappropriate methods, will be removed from the iOS Developer Program.” It may be that Apple views the campaigns as unfairly gaming the system, but the company has not been crystal clear in communications. Apple evidently doesn’t want its top App Store rankings to be manipulated. Some days into the changes, everyone seems to believe that Apple has users in mind as it enforces the 3.1 clause more stringently than it has in the past.
The good thing about incentivized apps is that they allows children and other people without credit cards to get new paid apps without having to charge the transaction to a credit card, Shah said.
“A significant number of users are upset about [the change],” Shah said.
Shah also said that the situation is similar to third parties trying to game Google’s search research. Rather than completely shut down the search engine optimization companies, Google makes its algorithms better so that the search results can’t be gamed as easily.
Tapjoy, Flurry, AdMob, W3i and Apple’s own iAds have generated considerable revenue (possibly hundreds of millions of dollars) through pay-per-install campaigns.
Over time, Apple may suffer from this change in policy as Tapjoy and other game developers embrace the Android platform, which doesn’t have the same restrictions that Apple has put in place.
“There is an enormous amount of shift in investment to Android,” Shah said. “What Google has done great is made their business predictable. Our Android business is doubling month over month.”
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Tags: incentivized downloads, pay per install
People: Mihir Shah
