Applovin vs Unity: How Applovin Destroyed the Competition!

Like how I like I was just talking to someone like, "Oh, I heard this." I was like, "But I heard this the same thing from other people like but it's not true. This is this is bullshit." Right. All right. Well, let's get into it. All right. So, I I already started the recording. Awesome. Hello everyone. Welcome. Today we discuss the very latest in mobile user acquisition with a specific focus on the two biggest non-self-attributing networks in market App 11 and Unity. Uh it's been a tale of two cities in terms of performance since Appempted to merge with Unity back in August 2022. We'll talk about that. So we'll talk about just the general market as well as both of those two companies. But maybe we could start by just talking about the mobile user acquisition market of today. I'm hearing a few mixed things about whether it's easy or possible for certain companies to get positive ROAS, that payback windows are expanding, things like that. You guys actually know so maybe we could start there. Where are we today guys? Somebody jump on in.

I'm not sure. I I'm always very positive about things and I've been on this podcast so many times and if you remember Joe, we talked about this uh I think last year or the year before uh with the guys with Matthew and Brian about how Apploin is killing it and it's not going to go away and it's like oh and now we are here and it's killing still killing it although it's quite dangerous for for the whole mobile gaming industry because then like couple of years ago it was basically Facebook, Google and Now it's Apploving and and a very big gap of performance and then everybody else. So mate, let's jump into that, but like maybe the high level in terms of the mobile UA market today. Can you talk about rumors or discussions or debates right now about whether it is more difficult to get positive ROAS, whether payback windows are expanding, things like that? What are you seeing?

I mean the thing is expanding because the CPI is rising. I mean which is the discussion we had a million times before. It was like, oh my god, CPIs are increasing. Yeah. Thank you very much. Like welcome to the gaming industry. Water is wet. Exactly. Yeah. Every year we have all of like if the same discussion, CPIs are increasing, is it's tough. Paybacks are well prolonging. Yes, they are. I mean depends on on your goals then how much money you want to spend, where do you want to spend. So yeah, it is still profitable. I mean, it is still a you are still able to get the profitable paybacks or like to to get profitable UA. It's just it's different, simple as that.

I totally agree. It depends what your goal is. I feel like uh a lot of companies' goals right now is not on the pub side is not to make money. It's to it's to have a very high revenue number. Um, but then we all complain that the revenue multiple in gaming is really low and it's like, well, yeah, you're not creating value, you're creating a revenue number. Um, and so a lot of these companies that complain that you you can't okay, I can't run a $100 million business um at high profitability. Well, like well, could you can you money at like a $40 million run rate? Well, that that's the real size of your business and there isn't an acceptance of that. There's like this idea that well, we can see on Sensor Tower AP revenue. So, that's how we judge each other, but like your your revenue doesn't impress me. Your revenue doesn't impress me. Your your your yield does, your profit does. If you guys ever want to see something funny, just like pick any company in mobile that's been acquired over the last decade and look at their Sensor Tower revenue before and after the acquisition. Yeah. Yep. And it's like it's just blatant financial engineering, you know?

It's like that's that's interesting, Josh, that you you say that. Like I feel like I saw a ton of that in the 2010s, like like late 2010s when there was like the fervor of of M&A. Um, and uh a lot of illogical actors like really driving up the costs. I It's interesting if it sounds like we're getting back to that period. I I don't know. I have a limited scope. I see that, you know, the games we operate on um at Uptick, but it it I I don't know that like the trend has been that CPMs have consistently gone up, CPIs have consistently gone up. Like obviously we've talked about it to death, but like you know, scan iOS broke everything for a few years. I think interesting thing to touch on today is like it's kind of gone back to normal basically everywhere except Google. iOS like fingerprinting is just back on the menu everywhere. Um, but we we actually we found like we kind of had a trough of like actually cost went down for like years and years on iOS at least kind of moved over to Android and now we're kind of getting back to the old old world um of you know, we've I think the industry learned like Apple's not enforcing everything. So, um, yeah, I don't know. The the theme I hear is like if if you suck at UA, uh, your belief is, well, everyone knows that UA doesn't work anymore and you just assume that it's a it's, uh, the industry is broken and it's not maybe that you have a bad product or a bad user acquisition function at your business. Um, but practically, we've seen it hasn't gotten like any harder, any easier. The rules just continue to change as they always do. The network stack of like who's on top continues to change. like if you have good if you have a good game, you can make UA work same as ever. Um, but you can't just use the same tactics that you did five years ago.

So, yeah, it's it's it's it's no exactly. It's just you have a game, you have an LTV and that dictates the level of spend and the payback period. End of sentence. I mean, it's just five years ago it was Facebook, Google, something else. Now it's Apploving, TikTok, Google, different uh channels on different networks and you have the rewarded UA space again. Well, not again. Yeah, kind of again. So, it's just it's the same logic and structure is just different and changed the whole UA channel mix. But the overall logic around the UA and how much you can scale, where when can you get the money back? Same thing. Same thing all over again.

Okay. So, sounds like there's some mixed views. I I thought the whole UA kind of, you know, sort of gloom and gloom again. Here we are. I mean, I thought the whole game around aggressive UA, we'll just call it aggressive UA models was done after glue or it was starting to come down, but yeah, maybe in some cases it's still it's coming back. Yeah, it's very challenging. So like Wildcard is a we run UA very profitably. we as a business are profitable and not all of our competitors is that true for. We're primarily ad monetized and uh some of the businesses that we're bidding against in real time like I can think of a couple off my head their names and you've heard of these names um they're they're running ad monetized games on 18 plus month break evens. It's like it's insane. The So that's what I've been hearing. I've been hearing paybacks are expanding and things are getting more difficult. So maybe there's a few players in market who can basically piss in the pole. You guys Yeah. No, they they are they are accepting um they are they're buying everything at very low yields, pushing up prices in some ways. Um and they're not actually creating a business. They're creating something that's sellable. Yeah. Yeah.

Great. Uh I will say this. I I have seen some numbers from certain companies being characterized in misleading ways on on their UA. So, uh, and I, and I, so it might also be that kind of we're at this kind of cycle where a lot of companies are starting to run out of cash, a lot of game studios, and so I can see that there might be this incentive, hey, let's just let's just push UA and then let's, you know, kind of window dress some of our numbers. I know, but I I've seen some of that. What people don't really understand when when you're looking at different external tools, it's it's a it's just external tools. You don't really see the the actual numbers. it you don't have the context. Like the context is everything. You don't have like why are they scaling? Is it profitable? Is it just extending the pay? Because what Josh just Josh said, Josh said as well, and there are no ads in Sensor as well, which can change the whole equation dramatically. People just don't know. Smell detail.

All right. So maybe we we can get to the topic that I know a lot of folks are going to be very interested in and it's a question. You know, Josh, I've been bugging you about this for a while, which is the the whole thing about Apploving versus Unity. And since the announcement of their merger way back, it has been very dramatic in terms of Apploving. I just hear from friends, oh, they're killing it. They're just getting all the business. They're destroying it. And somehow Unity is not doing so well. So maybe we could go ahead and address that the elephant in in the room, which is what are what are they doing? Why is Apploving able to get so much business when you would think from a strategic perspective and having engine Unity should in theory have an advantage? Uh what what's going on there?

Yeah, I mean Unity has an execution problem right now and I think that's been pretty well documented in consistence. Um uh there's just a a lot of restructuring as they kind of continue to combine two businesses now. um and kind of consistent reorganizations across Unity grow. Um but what's really interesting is at least to me is what Apploving's been able to do. Uh I think it's really atypical because when you think about the industry in general um you think about it in terms of like DSPs like the demand side and SSPs the supply side and ad networks have always focused in the DSP because it's where the money is. Um Apploving did something very unusual, which is they've actually focused for a long time on the the SSP, the mediation piece. Um, and that's actually done something special where it's locked in their supply. Um, and so they've been able to really dominate in an extremely novel way. And so the flow works something like this. Um, if you want to buy inventory from a game um that mediates on Max, there's no better way to do that than to to run UA on Apploving. Yeah. And just for our audience, Max is their ad mediation platform. Unity also has an ad mediation platform, but uh apparently uh so well, I'll I'll let you you go into the details of that. Um the quality of them isn't as material as it used to be. Um, so if you want to buy inventory from a game that mediates on Max, you you really it would be silly to not use Apploving App Discovery. Um, and well, Max has an probably has an 80% market share is a good guess today. I mean, Zynga is on Max now. Um, so Apploving is a huge priority. 80% of impressions are probably mediated through Max and everybody but Apploving gets charged a 5% fee to bid on Max. So even if their algorithms were equally good, you're going to get pretty material like a 5% bid bid decrease is is a pretty material for UA. Um, so running Apploving UA is a huge priority. If you think that's the main reason, Josh, or do you think there are other reasons?

Um, I think there's that. I think there's first-party data. Um, it's kind of a subtle thing but I don't think it's that's hardly there. Like come on, usually uh so it depends on what we can prove uh what we can kind of say like what you can say very clearly is that like if you're mediating with Max and you want Unity or IronSource or Moloco or something to buy on that ad revenue, that ad revenue gets passed um from Max to the clients to one of like eight or 10 different MMPs and then now that one revenue event becomes eight or 10 different kinds of revenue events that get passed back with different parameters, different features for ML to train against and Unity and Moloco all these people have to figure out well how do we kind of combine these eight different events to be the most usable. Whereas for Apploving, the data never even leaves their servers and they get to decide exactly how it looks and so they have one source. That's the first-party data advantage. It's very, very fast um and it's consistent and so there's no situation where it's like, well, 2500 of the of our events have this parameter because it comes from Adjust and 60% have this parameter because it comes from Maxify. It's the exact same, which means their ability to make decisions and learn is just objectively higher. Plus, there's no lossiness of it going um Max client MMP all the way back to them again. It's just it's just all internal and Apploving. So, you get that and you get a 5% fee. Even without funny business, like the sad truth, not sad truth, the impressive truth is even with no funny business, those two things are a lot. Um uh those two things are a lot.

Well, if you think about it, this is exactly what what Google is doing with Firebase. I mean, it's the same logic. You for Google campaigns, you use Firebase Firebase events because that that data doesn't really leave Google and you know like it's when you compare MMP event tracking versus Firebase event tracking, the Firebase is like relatively like 20, 30% uplift or like better performance because it's their data. I mean, it's exactly what Apple does, but on steroids, honestly. Yeah. Yeah. Um, exactly. And it the the way that that's felt for advertisers is much more dramatic, like Mate said, is because um when you buy on Google, when it comes right down to it, you're you're mostly buying their own inventory. Whereas on Max, Apploving's advantage isn't just by you're out bidding other um app um inventory or demands, you're actually taking demand away from Unity, from Moloco, from everything else. And so that delta is is is really dramatic. Um, so yeah, so you just you really want to run Apploving UA. But it doesn't stop there. If you're at least 25% ad monetized, you really want to use either ad ROAS or blended ROAS campaigns on Apploving's App Discovery. So the UA that you want to run is um like a ROAS optimized product. But the problem, yeah, you're only allowed to use ad ROAS or blended ROAS if you mediate through Max. And so now if you want to access that 80%, you have to make that 80% 81%. And now you're in and you can scale. and now they have 81% and that's how they lock you in where now they're going to become let's say a third or um or um maybe even 40% of your spend in some cases. Now you really can't leave um Max because you lose App UA um because and it's not because you're locked in on the ad monetization side, it's because as long as your competitors, the info you want to buy is on Max, you're locked into Max. And as long as everyone's locked into Max um they kind of own that ecosystem and so it doesn't even matter anymore uh if Apploving or AdMob mediation is better because it's not about you, it's not about AdMob, it's about UA.

Well, there's a snowball effect, right? So if I mean, for to make a devil's advocate advocate case for like IronSource, Unity. Um, historically the same thing's been true at least for IronSource that if you mediated with them, you could monetize with their ad revenue data and see better results. The the old school like rule of thumb was like if you do AdMob with IronSource or LevelPlay, is their AdMob system, then you're going to see better UA results on LevelPlay. If you do AdMob with Max Ads, you're going to see better results on Apploving. But to your point, Josh, at some point there's like a point of no return, right? Because if you start hitting like a critical mass of buyers on or sellers on one or the other, there becomes more incentive to switch over. So you get the other side of that demand spectrum. Um have like if you if you are if you're an app developer and uh you know three-quarters of the buyers have moved to Max uh or to buying on Apploving, you have every incentive to switch over to that that stack. And likewise if you are uh if you are buying UA like you you have the incentive to move to like where there's you know more inventory available where there's more integrations. So it does start to feel especially with I mean I think we're going to get to the fun part soon which is like how Unity is dropping the ball in like every way imaginable. But like there there hits a point of no return where like can can anyone come up with a compelling incentive where like if you were shipping a new app today, why you wouldn't prioritize Max Ads? Like I I don't think in app I don't think that was the case like even a year ago, but I feel like we might be at that point of no return now.

Yeah, there that's very true. Also the incentive uh I mean everybody has an incentive. If you if you go to Max or to or well it was the case before so they wanted to move you to Max that you got pretty big cash incentive. But the thing is even if you also there was like, oh, we maybe we can have an uplift like 10, 50, 10, 15% on the ad monetization side, but as just said, just said, like it's the same thing is like it's the UA part that makes the difference because then like the the ad ROAS campaigns and blended ROAS campaigns thanks to the first-party data and the scale of or like the inventory size is just dramatically better. So it's not like it's 30, 40%. That's the best case scenario. If 30% or 40% of your UA channel mix is Apploving, that's perfect. Nowadays I see 70, 80%. And that's very bad. Why? Because if if Apploving campaigns die, then your company is dead. Like it's it's we are at that point. Seriously. And I know it also means you got no bargaining power. Um means they can just take higher margin. Right. Um which they should if they're winning that much, they should take higher margin. Um, but that's a it's a challenging thing. Yeah. And also like what how they did like like how we ended up in this this position with Apploving. They at some point they onboarded almost everybody on Max. I mean, I think the latest data is like 180,000 apps on on Max. Like that's insane. It's really like that's a big that's a very big number. Very, very big number.

So should we roll back to whatever it was uh August of uh 2022? uh you've got Apploving thinking, "Oh, we need to merge with Unity because we're in trouble here and then all of a sudden they they start to execute a after, you know, the the failed merger attempt, they start to pull away." And Warren, you mentioned there were some issues. I have been reading about some of those issues on on Reddit, but maybe I should let you guys explain. So when back then when they were I think you could fairly characterize them as potentially even or maybe Unity actually being strategically in a stronger position to today. How did they from where they are today to back then? What did they do back then? How did they execute or what happened such that they pulled ahead?

Yeah, I mean Unity, this is one of the most historic like own goals I think in all of of adtech. Like Unity had every advantage and it's not to say that it can't be saved, but you know, they're basically they have an SDK that's already in the majority of mobile games. I think there's just a huge gap in operational leadership between these two companies and we've seen that in the thrash of Unity leadership. But Apploving has just been able to like leverage every possible advantage. Um, every time there was an opportunity, they've been able to maximize it. And conversely, Unity has squandered these massive opportunities. Like they the businesses within Unity have seemed so siloed both between their games business and their ads business. And then I was personally super bullish when they acquired IronSource because I was like, "Okay, awesome." Like Unity has all these integrations, but they suck at sales. They suck at account management. IronSource is great at both of those things and they IronSource had a better algorithm at least in my uh my experience and our data, we always have better performance from the IronSource algorithm. Different things. Okay, cool. Let's let's get into that. That'll be interesting. But I mean anecdotally in our portfolio, we saw better results from from IronSource one way or another. Um, so but then this merger happened and like nothing was capitalized on it. It's like all of the all of I I don't almost everyone seems like they're gone at IronSource now. There's complaints about the management that's still there. Um, there's just like very basic operational stuff. Like uh our this can sound like a humble brag, but I use it to make to make a point. Like our our team has spent like eight eight figures on IronSource inventory over the last the last few years. GDC just came about. Like no one had we we had no contact from IronSource or Unity. Like no there's like no communication. Just basic basic operational functions are not happening for even like people that spend tons of money with them. Meanwhile, like Apploving is like seizing every possible opportunity um and maybe some that are more or less ethical. I think we'll get into the short reports pretty pretty soon. Uh but but Unity has had so many opportunities to leverage like these combined businesses. They had the the operation expertise of IronSource. They had the integration of of their app in like almost every mobile game and they had, you know, they had the ability to do so much with this and it just seems like there was no leadership pulling the these pieces together.

Like what's what's the take from you guys? I actually think they were in a horrible situation before the merger and that's why they merged. I would go back like an incremental six months or so, maybe six, seven months before then. you know, Max had I'm gonna kind of guesstimate numbers based off memory and the fact that there's no real data, but by feel by feel um like June 2022, LevelPlay is at maybe 25% market share. Max is at maybe 40% market share and MoPub is at maybe 25% market share. Um, and MoPub was that last white knight. It was a pure mediation product with no real network attached. It was owned by Twitter and Twitter didn't want to dismerge their brand by doing dirty things um as they would call it and they weren't willing to do what LevelPlay and Max were doing. Um, and so companies like Zynga, I think Zynga at the time was on MoPub. Um, and so there was this nice big clean thing and it had this massive market share. Uh well, Apple bought it. They shut down the tech and what they did was they took the account managers at at Twitter and trained them to sell Max. And then um the old CEO of Max, Dan Sack, was the he was the BD guy at the time. And basically his entire job was before MoPub shuts down, sign it was like a hundred million dollars in deals was the number that got announced um of incentives to move all of those MoPub people over to Apploving. And so what happens when you go from 40 to 25 to 65 to 25, right? Well, Unity and IronSource go, "Oh, we better merge." Um, but that was like reactive. They'd already like this data play, this like owning owning mediation. Um, it had already gone like played out. Like uh Dan Sack like some months later just like left. Like my job is done. I've succeeded. That's kind of what he was there to do was to like build that Max that Max user base, that client base and from Go ahead. Sorry.

I I was about to say so it's it sounds like the way that you've characterized things, Josh, there are network effects to this game. Unity did not quite realize that. I uh Apploving always did. Yes, and win. I mean, always. And we can end this. The best characteristics of I mean, that's it. Well, and to be clear, like Unity actually did see this. I'd say JK, the problem was simple. They tried to build their own mediation product and they failed. Yeah, there was an execution problem. I think there's one other big problem too during this era, which is out in the wash in hindsight, but for anyone buying Unity Ads UA at the time, their algorithm sucked. It was horrible. Like, and like if you were if you were an individual buyer at the time, mate, I'm sure you saw the same thing. Josh, you probably saw the same thing. Like you'd see these bad results compared to the other award video networks. You talk to your Unity rep and they'd be like, "Oh, I don't know. It's it's working for everybody else. Like I think it's just, you know, try raising your bids." And now now they've come out and said, "Yeah, our algorithm was totally broken. Like we we need to like rebuild it from scratch and and sorry everybody. Yeah, it didn't it didn't really work well." You know, it's like that was very clear to us at the time. And obviously like uh over over enough time like the data is going to rule. If people are buying from multiple rewarded video networks and your returns from Unity are way worse than at the time IronSource was separate, but way worse than IronSource and Apploving, you're going to move your your budget away to those. So, they also had the the self-own that side of just like operating for so long with so much money pumping through their ad network with a broken algorithm that wasn't delivering good results for anyone. Right.

And on the execution issues, again, I don't have uh I I can't I I don't want to say definitively what those issues were, but there's so many rumors going around in the industry. So, I at least I can speak to some of the rumors. One that Unity around that time had a very I don't want to get political, but you know, a lot of people were saying like woke culture. Uh so they were just not operating very efficiently, kind of age of excess type of things where there's a lot of politics, people can't make decisions and so a lot of stuff just got paralyzed and then there was like a very lackadaisical kind of complacent work ethic. Isn't that like every big company? Uh no, because like look look at look at Meta, right? Like uh Zuck has really turned around a huge company in terms of like the um the work culture and things like that. But not only that, but then I I think what I've been reading about and what I've heard is that there there was like kind of a cultural conflict between maybe the the the Finnish kind of culture and then like the Israeli culture from IronSource and then all sorts of rumors and stuff there around uh conflicts between those two teams whereas they should have been executing to you know play the game which is you know it's there's network effects here. They need to go out and and make sure that Apploving doesn't capture you know a huge part of the the market and they were instead of fighting Apploving, they were fighting themselves, is sort of what I've heard. But yeah, I kind of I heard similar things from one side. I heard, oh my god, they fired now all the like Israeli ex. Now it's it's not going to go anywhere. Then then I met some of my friends that worked in Unity and they said the other way, like, oh my god, finally that happened because there were there were some tensions between Israeli culture and the the Finnish culture and the US teams as well. And then like, oh, well, we didn't or they the Unity, they didn't kind of uh integrate the the IronSource algo because they said it's it's obsolete and doesn't really work well. And they like, oh, well, let's try to rebuild the Unity algo because yeah, it wasn't working as well. And now it's it's it's going to take a lot of time. And now they're coming out with the Vector announcement. It's all sexy and shiny, but it's it's non-existent. Yeah.

Well, and so may maybe we could touch upon that because I I don't want to be too gloom and doom. And by the way, just for people in the audience to know, I like my studio uses Unity. We really want Unity to do better. And I will say this last GDC was maybe the first time I've been hearing more positive than negative about Unity. So I I maybe we could just jump into some of that since you mentioned. But it's slightly different for you as a company and for us as UA people because what Warren said also like the Unity reps, they just disappeared. Seriously disappeared. And the only thing you have is just this SMB unity.com or whatever email and then you get like all these random generic answers and you will just not get any any support. It's terrible. Yeah. So, and it's for you. I will say I'm I'm very lucky, very, very lucky to have good Unity account management um where we have a dedicated account manager um on the supply side and on the demand side. Um however, I will say, I believe congratulations. One each. Yeah, one each. Yeah, exactly. Yeah. However, I will admit like experientially it's been challenging where there have been a lot of reorgs um and and who owned what kept changing. Yeah. Um, yeah, just go ahead.

Oh, sorry. I was just about to say, just for our audience to know, Apploving in particular has extremely strong sales culture. Like these are some of the most charismatic people you will meet in your life, right? And so they they they're great at it. And on the Unity side, I guess what you guys are saying is that they they need to improve a little bit. Yeah, it's mostly non-existent. And you you compare like one of the best sales teams in the sector to a non-existent team and like there's that advantage as well. Very big difference, right? I I would say in North America at least, I don't know, Warren, how you've experienced it, but there were some changes uh Octoberish last year at Apploving where there was a reduction where they lost some of their largest um or the largest their most senior account managers. I I would say for North America, Apploving account management has gotten um those poor human beings, they are so busy right now. Um, it like the the the quality has been a lot more touch and go. U, I it feels like it's improving and so I'm I'm really impressed that they've done it, but it has been a challenge for them. Um, so it's not been perfect um in North America, but that that may not be the case outside of that one.

Well, one one really wild thing that I've seen at Apploving over the last year that like made my jaw drop is like normally it's like, you know, the to our point earlier, they have a very strong sales culture. Historically, it's been like anything they can sell you anytime they can, you know, do new business with you, it's been a go. For the last year or so, they've basically been saying no to to doing UA on a lot of the games we're launching. It's like because we work on games at different stages. Sometimes they're already in market, sometimes they're soft launch. And these days it's basically like, well, are you guys already spending six figures a month? Are you integrated in Max? Uh, yeah, talk to us later. Talk to us like like we don't really want to be at part of the launch yet. Which I think why do you think that is?

I don't know. I mean, well, I mean, there's there's you can make a a bold or better case for this potentially. It's like if it could just be an optimization thing of like they see where the revenue is coming from and where they're putting their human capital to manage those accounts and it's probably so disproportionate to those accounts that it's like I mean, we all do this for our businesses in some capacity. It's like how are we resourcing versus how are we driving revenue for our business? And I think all these things that we're discussing, it's very clear that there's a certain profile of games that drives the bulk of Apploving's revenue. And they have now quantified that to where it's like, hey, if if they don't meet this criteria, why are we wasting time on them? That's not worth us like having human capital on it. Like we have so much more concentrated with this profile of customers. Yeah. Because I think it's actually even more dramatic than Oh, sorry. Go ahead.

Yeah, I just want to say like if uh if you're not big enough and you're not spending enough, it's you're not well interesting enough for for Apploving to yeah to to assign a person and because that that person can be leveraged somewhere else that where it actually makes more money for for Apploving and I think um kind of like steam size is an issue or a thing here. I've heard like some of like after the restructuring that you mentioned, Josh, like ah some of the like accounters like hundreds of accounts. Like how can you possibly manage that seriously? How can you possibly manage that? Yeah. And some of those AMs are I don't want to call them like children, but like it's their first job in adtech. Um, I I would say that going back to Warren's point quickly, I think that's always been true. Like, you know, big customers, you know, give you more revenue. Um, that was a really obvious. Yeah. And so, and so and so you want to care about them more and so they're getting bigger and so they can only focus in so many areas. I think the one additional effect that's starting to come into play is that Apploving as um publishers like demand partners scale, they're able to increment up more and more margin because if you're going from like 45 to 50% share of voice um, what do you want to do? Do you want to go from 50 to 52 or do you want to stay at 50 and take 10% more margin? Like at some point it becomes a lot like AP pricing in games. Like what do you want? Higher conversion rate or higher, you know, like price. It would be really unintelligent to just say, "No, we'll keep we'll just keep trying to sell more and more of these $3." Um, and so now I believe, especially with their level of market share, that the highest um spending customers also have meaningfully higher margin for them as well. And so now it's like even more disparate than it was in the past. So they're at higher scale and forget revenue, like the the profit potential is even larger than it was before. Okay. And I I think they're going to keep pushing towards self-serve um for that reason. Right.

So so I think we've now laid the case for Apploving and kind of characterized how they were able to gain so much advantage. Mhm. So, Monte, you mentioned Vector again just at GDC. I would say the first time I I felt like there was a lot of positivity. The folks I talked to seemed to at during GDC seemed to indicate that there would be a lot of positive improvements both on the engine side and at the on the ad side. I did not hear any specific details. Um, can you guys talk a little bit about Vector? Why is there enthusiasm for this? I'm hearing some people say there's there's something real there. Other people are saying, "Ah, it's just vaporware just, you know, for to just to manage as a public company. They're they're they're trying to get investors something to be excited about." What what is your view in terms of what may be coming and obviously right now nothing has been specifically announced, just hinted at.

Well, I can say I was at their AppFest uh event in Barcelona last year and they were I you were kind of talking about different things and how they kind of going to change the algo and kind of changed how they score creatives. So it's it's an different position and how it kind of kind of going to help that you don't really see the spend coming into one creative winner but actually proportionally spending across all the all the creatives because it's been a big of problem on on Unity especially. So that's what I've heard but I mean it's April. I'm not sure like when is it going to go live but it's it's time guys. Like yesterday was already too late.

I'm I'm so jaded to this stuff. Like I I started doing UA work in mobile I'd say most seriously in maybe like 2014, 2015 and like it is the most played out tale in all of the UA industry of like I mean when has there not been a network that's like, hey guys, we are introducing our brand new ML AI algorithm and it's going to make all of your UA perform better. Like that's been literally the pitch of every ad network in mobile throughout history at all times. And so like I'll believe it when I see it in the data. Uh but I mean this is just the last time they they that they said they they had a new and improved algorithm, it turned out to be like at the end of the day. And so it's like if they deliver on this, awesome, we'll see it in the numbers and we'll get their business. We'll give them more business then. But oh, I I'm not going to I based on the PR of saying like, "Hey guys, we have don't worry. Uh we have an AI thing that's going to like improve our business in every way." Like, cool. Let's let's see it and then we'll take it from there. Yeah.

I I I think it's very interesting that they have chosen to announce and brand um this new AI as Vector um but then not create like a brand identity within that. And so right now I feel like behind the scenes Apploving and our own feelings are creating the brand identity for Vector um which is like a huge challenge for them. So I think they need to start talking more um if they have something differentiating um or like that brand name is going to become like a set thing sooner rather than later and someone else is going to define it, not them.

Well, there's no there's no call to action right now. It's like, okay, cool. You guys are shipping a new AI algorithm sometime in the future. I want to am I gonna am I going to spend more money now? Like in anticipation of that? No. Yeah. Like I've been asking people like, "Have you seen it already?" Like like what are like I'm looking at Exactly. looking at my Unity campaigns and they're like very small scale and it's like okayish performance, but this has been the case for me forever. I'm not sure like what I'm doing wrong. Maybe I'm not doing anything wrong and this is just the case of Unity. No, you're doing everything right, mate. So like that's like the problem is like it's just small scale and like decent kind of semi semi-decent. And asking others like, have you seen any uplift or anything improvement? Like no. Like I like but they're talking about it for so such I mean what like a month or so, month and a half maybe. Like it's in beta, whatever. Zero people told me like, oh my god, this is such such a great thing. It's been oh my god, like I I Vector to please change the whole equation on the Unity side. No.

Well, let's talk about the same thing for for Apploving. So, like when they I I'm sure you guys get hit up about this all the time. Like every week, like 20 people hit me up and want to do like a consulting call on like Apploving or IronSource, right? So, there was like a couple of months where everyone's hitting me up and like, we want to talk about this new Axon algorithm. Like, what is the Axon algorithm like changing for you and like how is this like redefining UA? And I was like, "What? There was a new algorithm?" Like it so just honest question, like was there any did you guys see any sort of meaningful change or was this really just more of a exercise when the new algorithm rolled out for you? Saw pretty meaningful change. It was insane. Yeah. On the ad monetization side, like just looking like being able to see both sides is very helpful. Yeah. Mhm. Um, so when Axon 2 rolled out, um, the first thing we saw was Apploving literally collapse. Yeah, it crashed. Like it was just they had to basically it was in it was it was insane. Um, and it was hilarious. I I if I remember correctly, they rolled it out like two or three weeks before MAU. Yeah. Crashed everyone's ad monetization as well. Crashed all the Yeah. and then told their account managers nothing. Yeah. And so those poor souls Yeah. had everyone's quarters like going going to and they're just going to answers and there are no answers and like the senior leadership wasn't there to to answer those questions. Um, so it was like I remember it was a very dramatic time. I will not forget it. Um, but yeah, Axon 2 is like fundamentally different. What was special about Axon 2 isn't that it was like a special bidder. It's that it had a different like feature set. And I don't mean feature set like a product feature. I mean like an ML feature. Yeah. Different KPIs to take into consideration, basically. Yes. Axon 2 was essentially Axon 1 modernized. Cool. but it's um built to directly take features from Max like directly pipe in revenue information from Max and when it's when you get that first-party data, one one revenue thing like revenue that's not just one feature. When you are able to get super granular because it's first-party and it's super locked down, you can look at things like, well, there's like a revenue feature, like what was the impression? There's a CPM feature, there's a CPM delta feature. There's a time between ad feature. There's all these different features you can start to make cuz your data is locked in. And so now, um, everybody else is trying to cobble together these third-party events into something they can get one feature out of, maybe two. Um, Apploving can now start to get really, really granular. And so now you can see they've gone from running day seven ROAS campaigns to you can set day 28 time even for even for campaigns. Even for ad ROAS campaigns. Like that's insane. And it it is it's nuts. Yeah, it's nuts. Um um their ability to use that data pipe. It's not that they're they're magically like, oh, you set targets differently now or that like um or like it's magically pulling new users. It's just targeting existing users much better because its data set is just way better. It it's not that they like out ML. This is the data. Like it good data is really that's like step one when you do ML. That is the first good explanation I've heard of what the changes are. So thank you, Josh. Yeah, you're welcome.

Hey guys, I I wanted to talk about what So you guys are saying that Apploving significantly advantages larger players and things like that. I I'd like to talk about what small and mid-size studios should do. Before that, I just wanted to like close the loop on industry implications. If Apploving continues to execute, if Unity does not become a viable alternative or someone doesn't come in and become a viable alternative and Apploving is able to expand and increase lock-in, could you guys that's going to be the doom and gloom situation? That's gonna be the discussion. So what? So explain like imagine imagine Apple and Google didn't have a 30% fee. Imagine the fee was variable and secret and you didn't get to know what it was and all and you couldn't see what the transaction size was in the game. All you saw was the revenue coming out, right? And you had nothing to compare it to. Yes. How would you interpret that on the AP side, JK? Yeah, I I I think that would not be a good situation. It kind of reminds me of like Yeah, the ability

for iOS and Android, like for Apple and Google, to take margin and like, like take the margin. I mean, to your point, Josh, I I think this is like it's like one of the dirty secrets about the UA industry. Uh, and uh, I'm going to intentionally not name names here, so don't get sued by anyone, but like we have definitely seen, and I've seen in my career and plenty of friends and colleagues, same same thing.

You're doing the same thing with the same ad network, same creatives, same conversion rates, and like performance goes goes down a lot. And you you can basically say like, hey, you cut it out. Like to turn, I know you turned the margin knob up, turn it back down. They're like, okay, okay. And turn it back down, like performance goes back to where it is. And vice versa, like if you're really trying to get more budget from you, you can be like, well, you want to turn your margin knob down, and you they can do it, and performance will go up. And so it's like that it is totally um opaque. Like, and when the competition goes to zero, if it becomes AppLovin alone owning the sector, yeah, they can do whatever they want with that. And what I mean, what are you going to do, you know, other than you know, if you can buy through the sands at that point?

And for the record, I don't believe the account managers at Apple can can do that what you're saying anymore. I think that's all automated and algorithmic at this point and at scale. Um, I think um, I think I I learned about the mushroom strategy on Two and a Half Gamers idea of like that sounds how do you how do you treat ad reps? You feed them and keep them in the dark. I was just about to say um, yeah, and AppLovin treats their reps in very much the same way. Um, they they don't have as much information as you would like for them to have. Um, and that's like been a thing that's played out many many times. I was I was just about to say that the Felix mentioned this always and all the time. Well, the problem with this uh doing mangon situation is that you don't have any other option at that point. And also the fact that you know, like right now I I'm running up even for like small to mid-size uh games and app is like significantly better performing thanks to Max and all these things that we just discussed then Facebook doesn't does it's like nowhere near that that equation because the like let's say for other campaigns it's like it's just not there, just not there yet. They they don't have the the proper algo for the address campaigns, even though it should be, well, according to their words, better than the rest of the market, which is not Google, maybe a little bit, but then like what else do we have? Moco, but still nowhere near the scale. I I think DSPs are like the worst business in the world to be to be in right now.

Well, I I from my perspective, I see kind of three classes of of ad networks. You have like differentiated um SDK networks, whether that's Meta, like you own the network, you own the inventory, or you indirectly own the inventory with Max or LevelPlay. So, you have mediation. Then there's a combined DSP, SFSP. And then, yeah, let me clarify. I I think that it's the DSPs that don't own their own inventory that are like really not long for this world because your only value prop is like, well, we have a better ML algorithm, but it's like there's all these there's all these advantages that app has now over those businesses. Yeah. Yeah.

So just to get back to like, so small or medium-sized studio mate, it sounds like you're you're saying today the current market right now AppLovin has significant advantages. You you would recommend them to like, what what would your recommendation be? With no no way, there's no option. I mean, it's not an option. If you don't if you don't if you have or if you start a game right now or you build a game, your your basically your strategy nowadays is you build a game which is built around AppLovin algorithm. So you you make sure you you send enough data back to to AppLovin so you can then capitalize on the UA and like that's it. Then you have mate, you're you're forgetting a very important thing though, man. Unity's got a new thing coming sometime, and it's going to have AI in it. Very true. But no, but still like this not not an option honestly. Like right now you have ad ad revenue based game or even like 30, 40, 50% ads in the game. And well, 50 and more. No option. You have to have Max. If you don't have Max, you're losing. I mean, that's like simple. Okay. Right. All right.

So, mate, you're saying if you're, you know, for monetization and UA, especially if you have a a game that has a lot of ads in it, you have to use, you have to go to the AppLovin ecosystem. Is there any case where it would make sense not to use AppLovin? I will devil devil's advocate here and maybe just say the cases where we don't see AppL um as as a a key part or a leader in the UA portfolio because it Monte is absolutely right. If you uh are ad rev driven, you should probably be monetizing on today in 2025, probably be monetizing on Max and doing a lot of UA on on app. For IP driven games, um we don't see AppLovin1 is uh even in the top couple usually. So that's usually driven first and foremost by the sands these days. And then below that, we would see at at best parity between uh AppLovin and an iron source. um still for the last year overall, we saw a bit of edge in iron source, but I think it's it's almost like a coin flip um at that point. So that's that's the thing I would call out is like if if you're ad rev driven, app is probably ruling for you. If you're IP driven, I think the sands still have better targeting algorithms and more data available.

Yeah, I agree. Like the question is like where do you go? Um um to start out. I think that what I'm hearing on the IP side is like exactly what Warren said. It's very like your your mileage may vary. Um, but AppLovin owns that ecosystem. If you want the flexibility, the strategic flexibility of being able to go down that path, um, you you want to do that. Um, and so going down that path gives you flexibility right now where if it turns out your game is 100% IP and you're a small business and you're scale and it turns out that's the way it it is, well then it turns out that could you could have gone either way. That if it turns out you're 25 cent or more ad revenue, then you only ever had one decision. And so one path means you can win any way you want. The other path means you had to go with AppLovin. And so there's only one there's only one path right now that's safe in all scenarios for new game developers. Like a different from the ad network perspective, I think that's also very illuminating where it's like how do you beat AppLovin? Um, and I I think that when we talk about it from the industry point of view, we think about it as like there's this one linear like tug-of-war between those two companies, but I actually really do think that it's very diverse. is like different genres, but there's also I think um the the the way the dichotomy that's kind of forming is purchase versus um revenue focused campaigns. Even in the blended world, it's like a purchase and revenue bias. Um, I think that AppLovin sees everything. So they're always going to dominate on IAA. Um, if a network is going to compete with AppLovin, it'll be because AppLovin can't target what it can't see, and it can't see all the purchases. Well, that's the only end that's left.

Yeah, but look, so there have been like so many different uh actual cases. This is what like Tune Blast and it is like very old game now at like peak revenue in March 2025. The biggest channel is Apple. We have all these different camp games now coming like like Color Blockchain, Magic Sword, and all of these different like kind of hybrid casual but even like going towards casual games like they have so many IPs. They built the games around like very high level of like high number of events sent back to the either AppLovin or anywhere else. And this is what's what's the kind of like the future or like the how the the whole UA kind of landscape is now and working like you just like even if it's true IAA, IAA is better in in certain way because of Max, but also IP games, heavy IP games, it's just there's no this this is it. And this is not only case that you have Township, you have all these old games, they're just killing it these days because it's combination of like early creative kind of approach and also the AppLovin in the mix and the like number of events they can send back to all the channels. So there you go.

Yeah, I agree. There's like real urgency here where uh I don't actually think there's that much revenue growth left on the ad monetization ad campaign side for app because they already have it. Yeah, exactly. And so yeah, where does the growth come from? To Mate's point, the growth is going to come from purchase. And the reason that AppLovin can't see all right now is because they're not getting every purchase post back because they're not causing every purchase install. Now, if they keep gaining share, what's going to happen? And so there's your urgency for the other ad networks for execution speed, right? Um, because what happened with Max and IAA campaigns as they gain Max market share has to dominate. So what's going to happen as they gain AP market share? Exactly the same thing. And yeah, so let's talk about that. What do you guys Does does anyone have a chance at becoming a viable alternative? What would you guys How would you guys advise Unity? Is it basically game over in your minds or what should Unity do next? What should anyone else do next to serve as a potential viable industry alternative?

I feel like the chapter on rewarded video is almost closed, right? Like I don't see anyone being able to come in and completely upend uh you know it's it's kind of this point of no return that we've we've talked about on this episode. I do think just like our industry has continued to evolve like it's right now we we can't imagine what hasn't been created yet as far as like new forms of of advertising. So we will I don't think there's any realistic chance for Unity to have such good tactical you know overhaul in leadership and their their AI algorithm to be so good that it like undoes this story that it puts the toothpaste back in the tube. Um, I do think that there's going to be just like our industry has always been, it's a game of arbitrage. So, as AppLovin consolidates market share in this segment and turns its own margin tighter and tighter, I do think there's going to be more opportunities. I mean, one thing that we've seen a ton of this last year is like progressive rewarded video ad progressive rewarded networks is kind of like an emergent uh type of of UA that's that's kind of carving its own lane. And I'm sure they're kind of eating it on margin as they're trying to get established. But just the same way that UA has always existed, like there's going to be emergent competitors offering different things that are going to be willing to take less margin and hit the users in a different way. But I think for rewarded video, I think the story is is is close to done. I don't see how it could really change in a meaningful way at this point. What do you guys think?

Well, I think Unity needs to unfuck all these decisions they made, and it's going to take them a very long time to be even able to to come closer to AppLovin, which that's a long way to go. It's either you need a lot of investment and money to uh just and resources to make it happen, or it's just a matter of time. And even like the incentives now, it's like for Unity, it doesn't really go in in their favor, unfortunately. I've given them my feedback. I mean, I think Vector is going to be what it is. Um, and hopefully we learn it's becomes more public soon what that is. Um, but the the way you put that toothpaste back in the bottle, like let's talk about that scenario, like what does Unity have to do? They have to launch Vector. Vector has to win on purchase campaigns. It has to very effectively target purchasers um and become a viable UA platform for for everybody, but especially it needs to be able to dominate and do very well there because it's not reasonable to say that they can outbid AppLovin when AppLovin has all the data plus they can charge a 5% fee to Unity for bidding, and so Unity has to outperform the data by 5% is not realistic. So they have to win on purchase campaigns. They have to win on purchase retargeting. Um, and then they have to be able to use that and leverage that to be able to sell to us. Hey, you should move to us for mediation because look, our IAA is good enough that it can be competitive, and you know, hey, our our stack is very dominant towards purchase campaigns. So your retention is going to be a lot better if you monetize here, and then it can start to pull over mediation clients and then it can start to dominate on IAA. That's a very long chain of if, like that is in my mind sounds like a fairy tale, man. It's a long chain.

Yeah. I see a slightly different path. Okay. I see a slightly different path here which is like, and this is even more of a moonshot because it would take even a higher level of coordination between Unity's functions with this they've shown like wholly incapable of doing, but their big advantage that they still have that uh App has not replicated is that they are the default gamedev engine for mobile. And the same way that we talked about on this podcast how uh, you know, App has is starting to get the lion's share of admon data, the moonshot for Unity would be, and this would be probably a a violation of of trust of some some level, is basically if they're just like, yeah, well, it's like, hey guys, guess what, like Unity dev building on is actually going to be free, but we're going to use your data any way we freaking want to, and it's going to mean that we have like this level of user behavior targeting that is, you know, unparalleled. Um, that would be in theory how Unity could still win this. Yeah, I don't see that happening, but that would be, I mean, that that would be the thing that would make me eat my words for making fun of, you know, their their their new algorithm that they're announcing is if that's what you don't see that happening because of executional issues. Okay. Yeah, but I I actually think that was probably one of the reasons why I I think the AppLovin guys wanted to merge with Unity because they thought they would use that strategy against them, but they never did.

No, I think like right now I understand like why the the Vector is actually targeting the ROAS in like IP ROAS campaigns instead of IA because they have there's no competition for like this. There's no chance they can actually do what the AppLovin does. So but like even if they do well on the the Vector, it needs to scale. And there was always a big problem on Unity always and how can you scale on such a small market share? It's quite tough. So then like yeah, like those ifs, it's going to be very challenging. And I I wish it it happens because that can help the whole industry to just kind of move away from 80% budget spend on AppLovin and we need we kind of we need to kind of uh like wish Unity pulled this off for the sake of the gaming all the UA definitely because how do you how do you make all game devs make more money? The ad networks take less margin. Exactly. Why would ad networks take less margin? Because there's more competition. Same thing as as ad monetization, right? You have more Yeah. Yeah. Exactly. That's exactly the model. Yeah. Yeah.

But is there any other So if if Unity can't fix its executional and cultural operational issues, is there anyone else who can come in here or are we really dependent on Unity as the as our last chance for uh like a viable healthy market ecosystem here? I mean, I guess Warren and Mate, what do you think about Mint, Integral, and Moco? Mint, Integral, and MCO are kind of climbing up on the UA charts for me at least, and I've I'm seeing uh Mint Integral quite a lot on all the casual games. The B review on the podcast like it's Mint Integral is yeah, it's AppLovin and then Mint Integral. All it's insane. I would agree with that. Yeah. So Mint Integral is is probably the the most improved player. Um, it's it's one that I didn't have a lot of faith in and it's like a first year or two, but like just after seeing time and time again reliable performance, like it's it's become very relevant in our stack. Moco, I would say, uh, with all all with all love, it's it's sort of like best of the worst. Like I I so really, okay, I was talking about this, yeah, I've talked about this earlier, but like I I see so little value in the future of um DSPs that are not uh heavily integrated uh directly into the apps that their main product is the bidding algorithm. And I'm sure this varies by player. I know other folks that see great results with Moco, and we selectively in our portfolio. So I don't want to within the DSP sector, I think they're one of the best. So let me kind of clarify, which is not a very big achievement. Right. So yeah. Yeah.

DSPs have historically like, well, let me zoom out here. So like what are DSPs doing? They're they are arbitraging other people's inventory at the end of the day. And what we usually see when you look one level deeper at what DSPs are buying is there's two things. They are rebuying rewarded video inventory and adding their margin on top. So like they're adding another 20% or whatever that that network is. So they're kind of like putting a layer between you and buying directly from that rewarded video network, which is actually good inventory, but why are you paying that? Like it's it's like it's in my assessment, it's not really worth that margin on that inventory. Cool. I'll just go buy directly from that source. The other thing it buys is a bunch of like shitty web inventory that just gets optimized out over time. So like that's been big picture like what we've seen over the years with DSPs. It's either the bad web inventory that is harder to get direct access to, but you just optimize out, or it's the good reward video inventory, which you can just buy directly from the source. So especially as these titans like AppLovin get more powerful, their algorithms get better. If your product is saying, hey, you're going to pay us extra 20% because we've got we have an ML AI algorithm we're going to put in the middle, get get you better results. I think that's a really shitty business to be in for the medium term here.

Josh, please can you share something because you were smiling for like the last two minutes like you know something we don't. So please go ahead. Yeah, please. And maybe I'm wrong. I love being wrong when I can. Don't play poker with mate. Okay, gotcha. I get it. I get it. Um, or just shouldn't play poker. I know. I I agree with the thesis everything um that Warren Orin said. I think what makes Moco special though is that they have rolled out an SDK. Yeah, they have that SDK. Um, and it is gaining traction and it's working. Um, and I think it's unlocking a lot of product work on their end that is really exciting. And so I my expectation is that they'll be one of the faster growers when we look back into the year. Um, and I think a lot more um kinds of clients can be successful there long term. Uh, the fact that they have an SDK has unlocked so much more stuff there. Um, I think they could outgrow Integral. Yeah. Um by end of year, to be honest, just like looking on from the admon side and like looking at the progress they're making, the fact that their SDK is like so incremental. Um, which is surprising because usually when you launch a new SDK, what it does is you integrate it, and then it just causes ANRs and it causes crashes. Um, so usually it's like a very skeptical thing. Um, but it it works. Um, so they're doing they're executing. That's that's a great call out, Josh, and I'm glad you called that out because it's like all of these DSPs claim that they have like their their own SDK, like first party inventory. Yeah. And it's for most, it's such a tiny tiny percentage of the overall inventory, but that's uh if that's changing with the Moco, that would probably explain why, you know, on the UA side, we're starting to see them more and more outperform the other. But the thing is, look, like five years ago. So five years ago, like we didn't even like know know Moco and suddenly out of nowhere, like, hey, Liftoff, goodbye, we are here now. And it's like it's happened suddenly, and now they're moving really fast on the SDK side on the admon side, and yeah, I think they're going to be a very big player in this. Yeah, it is still early days. They are still DSP flavored, like, you know what I mean?

All right. So maybe last question then. Let's kind of think if if you guys could predict the future or I'm asking you guys to predict the future. Let's say two years out, and I'm sure we'll have many more discussions from now till then. But let's say it's two years from now. Who's winning? What is AppLovin's market share? Do you think anyone at that point two years from now has done anything meaningful to combat the the dramatic kind of strategic and market power of I will go first and say h Meta is going to going to grow and improve back again where they were before because they are paying attention what what's happening. and they're also trying to do all they can to kind of reclaim the position number one. It's not going to be easy obviously, like this year, maybe not next year, I would say so. And also Google is also watching from the behind and trying to do some stuff on the admonetization side to kind of level the playing field. So we are still keep forgetting about Facebook or Meta and Google, but they're watching, and I think it's going to be a huge improvement on their end because again, they also know be if they don't do anything, they will lose quite a lot and they have.

Yeah. Uh, we move like so slow in mobile. So like I would love to think that like we're meeting here like in a couple years and just talking about totally different players and totally different tactics, but my god, I mean, we talked about Scan for freaking like like finally we're talking about some stuff other than Scan. Like uh, I think we're going to still be talking about the same players. I do agree with mate, like uh, the the the large players that are going to be able to actually do very meaningfully. I hate I hate to say AI again, but like I I do think that we'll see like the bigger moves with AI from from Meta, from Google. A medium-term thing I would look out for is like, so Google, we I said early on, like Google iOS is kind of the last vestige that doesn't have fingerprinting in some form back on the menu. The moment that becomes back on the menu, that's going to become a huge emergent channel um for ad spend on iOS again because Google Ads continues to crush it on on Android, but it's just basically been out of most people's stack on iOS for years at this point. So, I think that's going to be the short-term change, and then longer term, yeah, I think you the next era of algorithms from Meta and Google will be a force to be reckoned with, and then TikTok will, you know, copy whatever that is. I think the the probabilistic kind of adoption on iOS happening for real this time is I I think going to be a huge trend this year. Uh, you know, Meta and Google have had probabilistic kind of sort of for many years, but it's not really being usable. It's not being in your MMP, and you can believe it, and you can see ROAS in a real way. I think that's going to happen this year. It's going to unlock supply for us, but it will also in the in-app ad space. It'll start to create some pressure for AppLovin where right now they're able to use probabilistic um and really push last click so hard to take so much of that attribution. Um, but like in a year or two looking at an app like what happens to AppLovin? I think the only two scenarios I can see in my head is is one is like either like fire and ice, like AppLovin continues to dominate ad monetized, but there's another player that can legitimately compete for purchase, and that creates the next war, that next fight. The other option is like way more sad, and uh, it's I remember I used to hear stories about how Intel Yeah, I remember I used to hear stories about how Intel did pricing when they were um dominant, and essentially they would just increase the price until AMD took a certain market share, and that was their um anti-monopoly strategy where they just increase their margins until AMD had a certain share so it looks like they're not a monopoly. Um, that is probably if I were the AppLovin CEO, what I would do. Um, so that's the other scenario where their margins just go up and up and up until we're still buying on other channels, but they're taking most of the margin out of the industry, right? And you know, there w there was a time when Windows dominated against Macs, and they were they were like on on it impossible. Yeah. And it felt impossible. So, you know, in in the tech industry, there have been dramatic comebacks before. So, it's I I think there is an opportunity for a lot of folks.

That was going to be my last question, but I forgot. One last bonus question. Okay. So, AppLovin is putting in a bid to acquire TikTok. What happens if they acquire TikTok? And may maybe you guys could describe what some of the advantages that AppLovin would have if they were to acquire. That's a that's a topic for another podcast. JK. Chase. Yeah. In my opinion, in my opinion, it just wouldn't be that in it wouldn't it wouldn't be like a bolt-on in any way. It wouldn't be that synergistic. It's like cuz there's such massive like what happens when Unity and IronSource merge? Did they just magically become one thing? Like no, that's like not practical. Um, it would be like a separate business that they would be buying and over many years maybe they could integrate, but we don't really know. Um, it would be certainly really interesting and if you were trying to distract from bad news, um, it would be a really good thing to be talking about a lot. But, um, yeah, I'm not I'm not sure if it would be like this massive value unlock moment. Yeah, it's an entirely different playing field if that happens. Um, it's an entirely different industry uh, if that happens. And so I I do agree it's like a whole separate podcast.

Okay. All right. Well gentlemen, thank you so much for your time and insights. I think it's was an interesting discussion. Uh I do think this is uh a very important topic strategic for the entire industry. So it's definitely something I think more executives and people in the industry should be aware of. So for our audience, thanks for hanging on this this long and we will catch you later. Thanks very much. Cheers. Thanks. Thank you all. [Music] [Music]