Facebook And Google To Lose Billions With Apple’s New Privacy Update

Social media privacy

The relation between Facebook and Apple, the two giants, is undergoing big tension due to the major privacy feature that has been rolled out on Monday.

Apple announced a new feature to its iPhones and iPads, which will allow iOS users to decide how they want their personal data handled.

The latest update allows Apple users to refuse to collect their data by other applications, including Facebook. This will also affect Google as their advertisement strategy is very similar to Facebook.

This announcement put Facebook in a difficult and confusing position, since the ads that can be generated from user data – are what make Facebook profitable.

However, Google has taken a different path to Facebook when it comes to ads. They have decided to switch to another Apple ad tracking tool that should not affect their business as much as it will for Facebook.

Apple’s iOS 14.5 privacy update

As we know, lots of apps already track our web activity/data through default settings we accept when we install them.

What’s different now is that this update will limit the amount of user data collected by apps. HOW?

The feature, which Apple calls App Tracking Transparency, will require apps to get users’ permission before collecting their data, or sharing it with third parties.

Users will be free to allow or block apps from tracking them. They can also open their settings and change their selection at any time.

What is the conflict between Facebook and Apple?

A recent survey by Zogby International revealed that up to 80% of users will refuse to grant permission.

In addition, 93% of Americans believe that being in control of whatever is collected is important, according to the Pew Research Center.

Facebook knows these numbers well and admits them. This is exactly the root of the conflict.

Facebook has been refusing the update, which threatens the source of its $86 billion in annual revenue: targeted ads. WHY?

In a post on the Facebook blog, the company said that the new feature may reduce the revenue made through its ad network in half, and that will leave the most damage to the small companies.

“Sharing data with advertisers is essential to providing users with better experiences,” Facebook added.

For his part, Chief Executive Officer of Facebook Mark Zuckerberg said in January “Apple may say that they’re doing this to help people, but the moves clearly track their competitive interests.”

In contrast, Tim Cook, Apple CEO, indicated recently “If a business is built on misleading users, on data exploitation, on choices that are no choices at all, it does not deserve our praise. It deserves reform.” 

What Has Google Said About This?

Google’s mission is to maintain a healthy ad-supported digital environment. Google will continue to address the needs of advertisers by providing consumers with accountability, choice, and control over their results. Apple’s privacy reforms are part of a larger evolution in the ads industry, in which both actors are adjusting to a new standard.

Why should we care?

The research consultants Cracked Labs believes that any data broker is estimated to have data on up to 700 million consumers.

In case you rely too much on website and app ads, especially Facebook, expect the ads you see to be less relevant if you refuse to collect your data.

The feature will also give you an overview of which apps are tracking you to serve you ads.

In the midst of all this tension, a number of observers are wondering about the secret behind the fight between Facebook and Apple in particular, especially since a lot of apps and companies will also be harmed by the new update.

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