Apple privacy rule will hit small apps’ ad revenues, leave Facebook, Google untouched
Facebook is pushing back on new Apple privacy rules for its cellular devices - and putting iphone app developers in the centre.
Apple will soon require software to ask users for permission to collect data on what devices they are using and to let ads follow them around on the web. The social networking said Wednesday that those rules could reduce what apps can earn by advertising through Facebook’s audience network.
Facebook said it expects “less impact” on its own advertising revenue than on the ad-supported businesses that count on its audience network to market their apps. The audience network allows Facebook and Instagram advertisers to put their ads elsewhere on the web.
Apple says the most recent version of its mobile operating system, iOS 14, is built to protect people’s privacy. It should take programs to ask users for permission to accumulate and share data by using a unique code that identifies their iPhones and iPads. The update is due later this fall.
Facebook said that as a result of this change, it'll no longer accumulate the identifier for advertisers alone software for iOS 14 devices. It is also asking businesses to create new ad accounts dedicated solely to running advertising for software for iOS 14 users so that you can comply with Apple’s new rules.
Facebook’s stock jumped more than 5% on the news headlines. Wedbush analyst Michael Pachter said the marketplace sees Apple’s new rule as more likely to shift demand toward Facebook’s own targeting system.
“Advertisers will go using what they know works, which is Facebook targeting,” he said.
Pachter said investors plainly feel that the competing ad networks run by the likes of Snap and Twitter will be put at a disadvantage while titans like Google and Facebook charge ahead.
Currently, if an iPhone user talks about something on the Amazon app, then looks it through to the very best Buy app, advertisers know that someone is doing your research. So they could deliver a promotion compared to that user, Pachter said. Once iOS 14 is released, that won’t be possible unless users opt in.
“That’s going to limit their capability to track lots of people,” he said.
But Facebook will still be able to track persons through its systems, which are separate from Apple’s device identifiers.
In Facebook’s second-quarter earnings call last month, finance chief Dave Wehner said the business is “still trying to comprehend what these changes can look like and how they'll impact us and all of those other industry. But the very least, it’s going to make it harder for iphone app developers and others to grow using advertisements on Facebook and elsewhere.”
He also called targeted advertising “a lifeline for smaller businesses, especially in a period of COVID.”
Apple, alternatively, said it really is intent on giving people more choice over how they desire to be tracked by companies on the web _ and the capability to say no if they don’t.
David Chavern, CEO of the news-publisher trade group PRESS Alliance, said the change is “more annoying than material.” But he added that it might still cost publishers money by making advertisings on their applications less valuable to advertisers.
“The annoying part originates from the loss of income at the same time when all earnings is important, and the unilateral nature of Apple’s decision,” he said. “They decide and all of those other world just has to adapt.”
