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Apple clarified rules for iPhone app developers on Friday, allowing them to serve advertising to users based on location — but only if the app uses the same location data to "provide beneficial information."
This is good news for the advertiser community, because it means they'll have some access to iPhone apps. It's also good news for users, because they won't be bombarded with location-based ads while using games, productivity tools, or other apps that don't have anything to do with where they are. But they will encounter them while using apps that also use the location data to provide a desirable feature.
"If you build your application with features based on a user’s location, make sure these features provide beneficial information," reads Apple's statement. "If your app uses location-based information primarily to enable mobile advertisers to deliver targeted ads based on a 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."
The rule leaves considerable leeway for advertisers, because nothing about it bars a subway station locater app from serving up ads for local Subway stores. On the flip side, it means more headaches for the team at Apple responsible for approving apps, because they will have to make judgment calls about the ratio of benefit to advertising in the apps they advertise -- and their track record so far is already a bit uneven, judging from developer complaints about arbitrary rejections and delayed approvals.____
Take IMDB's movie app, for example (iTunes link). Its core function is to access film information, but it also provides local movie listings based on a user's location. Will IMDB's app be allowed to serve location-based ads? It all depends on whether showtimes can be considered part of the same core function of providing beneficial movie information, or whether they represent a side feature that's more commerce than content.
Another headache for Apple's app judges will be what to do with apps that depend on lead generation. NiteFly, a New York start-up we profiled in October that's still in alpha, lets night clubs bid on patrons. A club might offer $100 for bottle service and a table at a club, in founder Evan Rose's example, based on how badly they need to fill seats that night. Users decide whether to take them up on the offer, paying five cents for each search. Every listing in NiteFly could be considered an advertisement or "beneficial information," based on one's point of view, and that means Apple's overworked app bouncershave another complicated issue to ponder when deciding which apps to let past the velvet rope.
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