German Antitrust Authority Tests Apple's ATT Rules

Apple's App Tracking Transparency framework launched in 2021 with the promise of giving users more control over their privacy. But now, German antitrust authorities are asking a much more pointed question: Is this really about protecting users, or is Apple using privacy as a clever cover for crushing competition?

The Bundeskartellamt launched a comprehensive market test in late 2024 to examine Apple's proposed solutions to mounting competition concerns. This market test represents a critical turning point that could fundamentally reshape how tech giants balance privacy protection with competitive fairness across European markets.

Here's what makes this investigation particularly significant: Andreas Mundt, the agency's chief, revealed that Apple has agreed to introduce neutral consent prompts for both its own apps and third-party applications. However, the final decision hinges on feedback from app publishers, media associations, content providers, and data protection authorities who are participating in this market test.

What makes this case particularly compelling is how it reflects broader European regulatory momentum against Apple's market dominance. France's competition authority already imposed a €150 million fine on Apple for what it deemed anticompetitive behavior disguised as privacy reform. Meanwhile, Germany's Federal Cartel Office secured a court victory in March 2025, affirming Apple's classification as a company with "paramount cross-market significance for competition". This classification creates a powerful legal framework that allows German authorities to impose proactive restrictions on Apple's conduct, setting the stage for more aggressive regulatory intervention.

What makes Apple's tracking rules so controversial?

The heart of the matter lies in how Apple defines "tracking" and applies its rules, with these technical differences creating significant competitive advantages. The Bundeskartellamt's investigation, which began in June 2022, centers on Apple's implementation of the App Tracking Transparency Framework introduced in 2021. The fundamental issue is that the framework requires third-party apps to obtain additional user consent before accessing certain data for advertising purposes, but these strict requirements don't apply to Apple itself.

Let me break down the specific concerns that caught the German regulator's attention and analyze why they create competitive distortions. First, there's the definition issue that systematically favors Apple's business model. Apple's definition of tracking only covers data processing for advertising purposes across different companies, conveniently excluding Apple's own practice of combining user data across its ecosystem. This means Apple can freely combine data from the App Store, Apple ID, and connected devices without triggering its own tracking rules—a practice that would require explicit consent if performed by third-party developers.

Then there's the consent dialogue disparity that creates friction specifically for Apple's competitors. Third-party apps must display up to four consecutive consent dialogues, while Apple's own apps show a maximum of two. Beyond the numerical difference, the design psychology is telling: The consent dialogues are designed to encourage users to allow Apple's data processing while steering them toward refusing third-party data processing.

This isn't just about technical differences in how consent works—it fundamentally tilts the competitive landscape. The German regulator specifically noted that tracking is particularly important for providers of free apps financed through advertising. When you make it significantly harder for these apps to access the data they need to monetize while exempting your own ecosystem from similar restrictions, you're essentially weaponizing privacy rules to gain competitive advantage.

How did we get here? The broader regulatory landscape

Apple's troubles with European regulators extend far beyond Germany's borders, creating a convergent pressure that amplifies the significance of each individual case. The company faces scrutiny under the EU's Digital Markets Act, which requires Apple to allow alternative app stores, permit users to set third-party apps as defaults, and ensure data interoperability. The stakes are substantial here: non-compliance with DMA rules could result in fines up to 10% of global annual turnover.

The UK's Competition and Markets Authority is also investigating whether Apple holds "strategic market status". Meanwhile, in the United States, Apple faces charges from the Justice Department and several states, including a March 2024 lawsuit accusing it of monopolizing the smartphone market.

What's particularly revealing is the contrast between U.S. and European regulatory approaches, which highlights how different jurisdictions view the tension between privacy and competition. Apple's ATT framework hasn't faced significant regulatory challenges in the U.S., with many regulators actually championing its privacy-preserving measures. This divergence suggests that European authorities are applying a more sophisticated analysis that questions whether privacy features can serve as legitimate business justifications when they systematically disadvantage competitors while benefiting the platform owner.

The real impact on competition and advertising

The numbers reveal the transformative impact ATT has had on digital advertising markets, providing concrete evidence of the competitive effects regulators are examining. When Apple introduced the framework with iOS 14.5 in April 2021, it fundamentally altered the advertising ecosystem. The shift was dramatic: approximately 75% of users allowed tracking through the IDFA before ATT, but after implementation, the allowance rate plummeted to just 4% in the U.S. within the first week.

These consent rate changes translated directly into market disruption. ATT reduced the share of trackable Apple traffic in the United States by 55 percentage points, from 73% to 18%. The financial impact was severe: given that trackable ad impressions command 51% higher prices, this decline translated to a 21% fall in ad revenue from Apple users for publishers.

This revenue decline demonstrates precisely why regulators are concerned about ATT's competitive effects. For app developers who rely on advertising revenue, you're suddenly facing a world where the vast majority of iOS users are invisible to your advertising systems, making it much harder to deliver personalized ads and measure campaign effectiveness. This creates an existential challenge to their business model while Apple continues to benefit from comprehensive data collection across its own ecosystem without facing similar user-friction barriers.

What's next for Apple and the industry?

The current market test represents a critical juncture for Apple's European operations, with the company now proposing concrete changes in response to regulatory pressure. The company isn't facing this challenge alone—nine industry bodies have already voiced support for the German antitrust authority's objections, alleging that Apple engages in "abuse of market power behind the fig-leaf of privacy". This coalition of industry opposition demonstrates how ATT's effects have consolidated competitors and regulatory authorities against Apple's approach.

The financial stakes are substantial and could set important precedents. Companies found guilty of breaching Germany's antitrust rules face potential fines up to 10% of their annual revenue. For a company of Apple's size, we're talking about billions of dollars in potential penalties, creating powerful incentives for meaningful policy changes.

Apple has defended its position, stating that it "holds itself to a higher standard than third-party developers" and continues to engage with regulators. However, the regulatory momentum appears to be accelerating. The €150 million fine from France has already opened the door to civil lawsuits from parties in the advertising industry who claim they were collateral damage in ATT's rollout, suggesting that regulatory findings could trigger broader legal liability.

What's particularly significant is the coordination happening across European regulators, which suggests a unified strategy rather than isolated national actions. The Bundeskartellamt is conducting its proceedings in close cooperation with the European Commission and other national competition agencies examining the ATTF in their own proceedings. This coordination could lead to harmonized regulatory requirements across the European market, multiplying the impact of any German findings.

The outcome of Germany's market test could establish new precedents for how tech giants implement privacy features while maintaining competitive fairness. As the investigation moves forward, it's becoming clear that the intersection of privacy protection and competition law will define the next phase of digital market regulation in Europe, potentially creating a template for other jurisdictions grappling with similar challenges in balancing user privacy rights against the need to maintain competitive markets in the digital economy.