Most people have known for years that tech giants like Facebook and Google make a ton of money knowing exactly what people are doing online and selling that knowledge to advertisers. Advertisers, in turn, are increasingly improving at serving ads targeted directly at them. But there has been a toll in recent years as people and governments around the world have learned just how much these companies know and what they can do with it.
Despite this, yesterday’s news Google will not create credentials following people on the Internet came as a surprise. The company also claimed that it would not use any new identifiers created by third parties. Google’s entire business model relies on detailed information about what people do with its services as well as details of the sites people visit with Chrome.
That said, Google has been moving in this direction for a few years now. The company announced in January 2020 that it plans to make third-party cookies obsolete within two years, and now Google has confirmed that it won’t just substitute itself for a new tracker or identifier that can track people on Internet.
This doesn’t mean that personalized ad tracking will go away, but it will be more anonymous. For example, Google’s new “privacy sandbox” technologies will allow businesses to target ads without collecting data at an individual and personalized level. Instead, advertisers will be able to target groups of users with similar surfing behavior and interests. Google will begin testing this technology in the second quarter of this year. “Advances in aggregation, anonymization, on-device processing, and other privacy technologies offer a clear way to replace individual identifiers,” Google’s David Temkin announcing the changes yesterday.
As usual, there are a few caveats, the first being that “first party” data, or information you collect about visitors to your own sites, is still acceptable for targeting. And this is something that gives Google an edge in the ad space, as the company has. tons data on the people who visit its sites or use its products, in particular if they are logged in with a Google account. And, , this change only applies to websites, not mobile apps. Market research firm eMarketer reports that 68% of all digital ad spend in the United States in 2020 was spent on mobile ads – but that figure doesn’t differentiate between spending on mobile apps and ads on mobile apps. mobile websites.
Google’s surprisingly strong position in the online tracking debate aligns it more with Apple and – and squarely opposes it to Facebook. As part of iOS 14, Apple announced it would in the form of something called Application Tracking Transparency. This will force app developers to ask users if they want to be tracked for ad targeting when they open an app. Selflessly, Facebook says disabling tracking in its app will who wish to serve ads to potential customers. Of course, this also has the potential to hugely hurt Facebook’s advertising activity in a broader sense, which hurts Facebook’s bottom line.
Google has not come out directly against Apple’s solution, but it takes issue with the way browsers like Firefox and let users . “Some browsers have reacted to [privacy] problems blocking third-party cookies, but we believe this has unintended consequences that can negatively impact both users and the web ecosystem, ”Google when it announced its intention to phase out third-party cookies. “By undermining the business model of many ad-supported websites, blunt approaches to cookies encourage the use of opaque techniques such as fingerprinting (an invasive workaround to replace cookies), which can actually reduce user privacy and control. ” It’s been over a year since that announcement, but it appears Google believes its “privacy sandbox” approach is working well enough for the company to make this week’s statement.
Google recognizes that in the short term, this change may put its own advertising activities at a disadvantage. “We realize this means that other vendors may offer a level of user identity for web ad tracking that we won’t – like PII. [personally identifiable information] graphics based on people’s email addresses, ”Temkin wrote. “We do not believe these solutions will meet growing consumer expectations for privacy, nor withstand rapidly changing regulatory restrictions, and therefore are not a sustainable long-term investment.”
Based on this, it appears Google is gearing up for a future where consumers and government regulators expect companies to be more transparent and more careful with the data they collect. It is also recognized that the internet has grown to such an extent that the compromises in the privacy of third-party cookies and similar tracking technologies are not worth the potential business gains, especially if Google can expand with its Privacy Sandbox which can maintain user behavior. more private while giving advertisers options to target groups based on their behavior.
Going forward, a big question is whether Google’s move puts further pressure on Facebook to change its methods, such as dropping its attack on Apple’s new privacy features. Given the sheer scale of Google’s advertising activity, it would be difficult for these changes not to impact the industry as a whole. But Facebook is an advertising heavyweight in its own right – and if its stance on Apple’s threat to its business is any indication, it won’t be forced into a more privacy-friendly world without it. to fight.
There is also the specter of continued antitrust interest – UK regulators are whether Google’s sandbox tools will give it a competitive edge. Google also faces antitrust lawsuits as well as , . While these lawsuits don’t necessarily have to do with user privacy, Google could try to show itself as a good corporate citizen with a progressive view of protecting its customers’ data. But the British survey already shows that the company will have to be cautious with this new initiative.
Ultimately, I’m very interested to see if Google can live up to its lofty views on privacy that it now declares publicly. If this move hurts short-term results, we could see a collision between business interests and Google’s recent privacy commitments.