Apps not using UDID data getting 24% lower ad prices

Mobile application developers without access to UDID data for iOS devices could see a significant loss in advertising revenue based on a price that is 24 percent lower, according to a recent study by international ad server for smartphone apps MoPub.

Apple’s deprecation of the unique device identifier, or UDID, has frustrated iOS app publishers that currently rely on the UDID both for ad performance and app usage data. Advertisers and ad networks regularly use this unique identifier to track how well an ad converts into an action, like a new app installation, on iOS devices – essentially measuring an ad’s effectiveness and value. This performance data is then used to decide how much advertisers and networks are willing to pay application publishers. The recent rejection of several apps using UDID data from the iTunes App Store has also raised concerns about what could happen to revenues for publishers and advertisers if they are unable to track conversions in the future.

The report was compiled from three months’ worth of data from billions of impressions through MoPub’s real time bidding exchange, MoPub Marketplace. The data provides evidence of how a world without ad conversion data from UDID (or an appropriate substitute) could hurt revenues for developers. It found publisher inventory with UDIDs that were sent to advertisers earned an average eCPM of 0.76 cents, compared to 0.58 cents for those ad impressions without the unique device identification, representing a 24 percent lower eCPM.

Apple’s recent response to UDID usage has raised concerns among thousands of app businesses that could be affected if conversion tracking data is not available, particularly developers of free apps that rely on advertising as their primary source of revenue. With no apparent option from Apple in sight, players across the mobile ad ecosystem are pursuing several different alternatives, increasing fragmentation in already fragmented industry. While some developers are continuing to use UDID data until Apple’s position is clear, others are removing UDIDs and other data designed to help ad performance and pursuing one of four short-term solutions.

While none of these solutions address all the existing needs and privacy concerns, the alternative that many players, including MoPub, have decided to offer its publishers is OpenUDID, an open-source project that has also been adopted by Appsfire as an alternative solution to the UDID. Thanks to the company’s open-source design, however, app publishers can choose to continue using UDID information or use OpenUDID as an alternative. But MoPub believes none of the existing alternatives truly meet the needs of publishers and advertisers in terms of privacy or cross-app performance data, and the company is looking to Apple for a more viable long-term alternative.

“The move away from UDIDs threatens advertising revenue that many publishers depend on in order to support their content creation and businesses,” said Jim Payne, CEO and co-founder of MoPub, in the press release. “Here, we see a direct correlation between the money paid for an ad and the ability to track an ad. It’s clear that Apple needs to address this issue with an appropriate alternative, because the damage to a publisher’s bottom line will likely be material if UDID data actually disappears.”

For more information on the implications of the UDID issue and its alternatives, visit MoPub’s blog here.

Source: MoPub

[Thanks to MacDailyNews Reader “krquet” for the heads up.]