Game engine maker Unity expects $30M hit from Apple's App Tracking Transparency

Unity Technologies reported earnings on Tuesday, and while overall guidance for the coming year is better than expected, the company anticipates Apple's new ad targeting rules to shave $30 million from its annual revenue.

The estimated $30 million reduction in overall 2021 revenue remains unchanged from an appraisal Unity presented last year, reports Venture Beat. That figure is now expected to be offset with a $50 million bump in year-end guidance.

Unity generates income from developers who use its game engine to create titles like "Fall Guys: Ultimate Knockout," "Ori and the Will of the Wisps," and "Oddworld: Soulstorm." Subscriptions make up a sizable portion of the company's intake, but advertising also plays a significant role in buoying the bottom line.

In the first quarter of 2021, the software firm notched revenue of $234.8 million, up 41% year-over-year. Unity sees an addressable market of close to $29 billion across games and entertainment, including TV commercials and animated films, the report said.

Apple's App Tracking Transparency policies prohibit developers from accessing a user's Identifier for Advertisers (IDFA) tag without asking consent. When opening an app for the first time in iOS 14.5, users are presented with an option to allow IDFA tracking. The feature, which is used by advertisers to track people across other apps and the web, is not enabled by default.

Touted by Apple as an important user privacy tool, critics say the requirement to obtain ad tracking permissions will dissuade users from participating and thus hurt businesses reliant on ad revenue. Unity is one such company bracing for impact.

While Apple has yet to release official statistics on ATT adoption, a recent analysis from Flurry revealed only 4% of daily users in the U.S. are allowing apps IDFA access.

14 Comments

borps 28 comments · 6 Years

About 3 years ago

Another company that made millions by getting a free ride on selling user data, now complains that they have to earn the right to use that data by building trust first. Cry me a river .

mcdave 1927 comments · 19 Years

Et tu Unity, et tu?

Apple should partner with these guys and go nuts on 3D rendering hardware.

welshdog 1897 comments · 22 Years

To make a level playing field so to speak, there should be a Federal law that grants every human citizen complete and total ownership of their personal and life data. It would also make it 100% illegal, with no wiggle room, for a real person or entity to use your personal data without explicit permission. There is just nothing wrong with this. The only objections would be from companies lIke Unity and others who want to make money off of us without paying for it. You want to use my data, okay fine - pay me. What would be unreasonable about this?

22july2013 3725 comments · 11 Years

welshdog said:

To make a level playing field so to speak, there should be a Federal law that grants every human citizen complete and total ownership of their personal and life data. It would also make it 100% illegal, with no wiggle room, for a real person or entity to use your personal data without explicit permission. There is just nothing wrong with this. The only objections would be from companies lIke Unity and others who want to make money off of us without paying for it. You want to use my data, okay fine - pay me. What what would be unreasonable about this?

There might be a middle ground. For example, the entire board of directors and senior management might be required to perform public service announcements, in keeping with the spirit of the warning labels of cigarettes, such as this: "Our company thrives on the collection and sale of your private data, without your knowledge or permission, which we all know is a highly immoral thing to do. And if there is a heaven, none of us will be going there."