MESSAGE
| DATE | 2021-01-29 |
| FROM | Ruben Safir
|
| SUBJECT | Subject: [Hangout - NYLXS] You ARE the product...
|
On 1/29/21 1:03 PM, Ruben Safir wrote:
> https://www.wsj.com/articles/apples-privacy-change-will-hit-facebooks-core-ad-business-heres-how-11611938750?mod=hp_lead_pos6
>
> Apple’s Privacy Change Will Hit Facebook’s Core Ad Business. Here’s How.
> Patience Haggin, Keach Hagey and Sam Schechner
> 8-10 minutes
>
> Facebook Inc. FB -3.34% will suffer damage to its core business when
> Apple Inc. AAPL -4.46% implements new privacy changes, advertising
> industry experts say, as it becomes harder for the social-media company
> to gather user data and prove that ads on its platform work.
>
> Facebook warned this week that Apple’s new feature, which is expected to
> roll out this quarter, will pose risks for its business, but the company
> hasn’t detailed how it is exposed. Facebook in August pointed to a small
> corner of its business that facilitates ad placements on third-party
> sites and apps. It has also played up how the change would hit small
> developers.
>
> The core of Facebook’s business, its flagship app and Instagram, would
> be under pressure, too. The Apple change will require mobile apps to
> seek users’ permission before tracking their activity, restricting the
> flow of data Facebook gets from apps to help build profiles of its
> users. Those profiles allow Facebook’s advertisers to target their ads
> efficiently.
>
> The change will also make it harder for advertisers to measure the
> return they get for the ads they run on Facebook—how many people see
> those ads on mobile phones and take actions such as installing an app,
> for example.
>
> “The market dynamics here are going to shift heavily,” said Simon
> Poulton, vice president of digital intelligence at WPromote, a
> digital-marketing agency. “If you are marketing on Facebook and the
> results are going down because the efficiency is going down, you are
> going to turn that down.”
>
> The chief executives of Facebook and Apple traded public barbs this week
> over the change. Facebook has aggressively pushed back against Apple’s
> plan. On an earnings call Wednesday, Facebook Chief Executive Mark
> Zuckerberg said, “Apple has every incentive to use their dominant
> platform position to interfere with how our apps and other apps work.”
>
> Apple has defended its policy, saying it is giving priority to user
> privacy. An Apple spokesman declined to comment further. Without naming
> Facebook directly, Apple CEO Tim Cook condemned “conspiracy theories
> juiced by algorithms” and tied recent social unrest to an argument that
> app-tracking tools are turning consumers into advertising products.
>
> “ “The market dynamics here are going to shift heavily.” ”
>
> — Simon Poulton, WPromote
>
> The extent of the potential financial impact on Facebook, which
> generated $86 billion in revenue last year, isn’t clear. The company
> said it expects revenue to be stable in the next two quarters. In the
> past year, Facebook’s business has thrived despite the coronavirus
> pandemic and a boycott by several advertisers over hate speech on its
> platform.
>
> Eric Seufert, an analyst and marketing strategy consultant who has
> studied Facebook’s business, said he expects the company to take a 7%
> revenue hit in the second quarter as marketers spend less and ad prices
> decline as a result of Apple’s change.
>
> The fight is happening as Facebook and other tech giants are under
> antitrust scrutiny over their dominance. Companies looking to forestall
> action by regulators in such situations often argue they face
> substantial competitive threats in the marketplace.
>
> “As we have said repeatedly, we believe Apple is behaving
> anticompetitively by using their control of the App Store to benefit
> their bottom line at the expense of app developers and small
> businesses,” said a Facebook spokesman.
>
> Part of the power of Facebook’s business is how it gathers data from
> mobile apps—what people do on the apps, what they search for, what they
> buy and more. More than 85,000 iOS apps had installed Facebook code that
> relays data back to the company as of December, according to analytics
> firm MightySignal.
>
> The data is often coupled with a unique Apple identifier for the app
> user—a string of numbers and letters that helps Facebook identify
> individuals, allowing it to add that data to their profiles, or
> “identity graph.” App data makes up about 15% of user profiles,
> WPromote’s Mr. Poulton estimates.
>
> Apple’s planned privacy change will mean that apps can’t pass along that
> identifier without users’ permission, thereby limiting what Facebook can
> glean.
>
> Ad buyers say Facebook’s insight into app usage is part of its value
> proposition. That data lets Facebook better optimize ads to the people
> most likely to become lucrative customers, saving advertisers money in
> the long run. For instance, a mobile game dependent on in-app purchases
> can target ads at users with a history of heavy in-game spending.
>
> Many apps are dependent on highly targeted ads to drive downloads.
> Dating app Bumble Inc. cited the coming Apple change as a risk factor in
> its filings for an initial public offering and predicted that 20% or
> fewer of its users would opt to be tracked.
>
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> Apple’s restrictions will also strike at Facebook’s ability to show how
> well its advertising works. Facebook gives advertisers metrics such as
> how many people who viewed an ad in the past week went on to buy the
> advertised product. The company relies on Apple’s identifier to get this
> information on iOS mobile devices—which account for a significant
> portion of Facebook activity: Among U.S. smartphone users, 45.3% used
> iPhones in 2020, according to Statista.
>
> Madan Bharadwaj, chief technology officer and co-founder of Measured, a
> marketing measurement company, estimates that Facebook will only be able
> to claim credit for about 50% of the sales it currently does, as a
> result of the change.
>
> “It’s going to have a huge impact on the total amount of revenue, or
> conversions, that Facebook can attribute to itself, which is basically
> the signal that all advertisers use for making investment decisions,” he
> said. “It’s going to drop their performance metrics hugely.”
>
> In August, when Facebook first warned of the coming Apple change, it
> pointed to Facebook Audience Network, a small part of its business that
> facilitates ad placements on websites and apps.
>
> Apple’s move is part of a broader tightening of privacy rules in the
> digital advertising ecosystem, from government regulations in Europe and
> California to Google’s announced plans to get rid of third-party
> “cookies,” bits of code used to track users on desktop browsers.
>
> In the fall, Facebook warned its partners that “upcoming digital privacy
> initiatives affecting multiple browsers will limit businesses’ ability
> to measure people’s interactions across domains and devices,” according
> to correspondence viewed by The Wall Street Journal.
>
> The silver lining for Facebook, Mr. Poulton said, is that its
> competitors will also be hurt by the Apple change, particularly those in
> the business of serving automated, or “programmatic,” ads in real-time
> across the web. Marketers who want to shift spending away from Facebook
> may scan the landscape of options and say, “‘Facebook—it’s not as good
> as it once was, but it’s better than this,’” Mr. Poulton said.
>
> How Apple and Google Formed One of Tech’s Most Powerful Partnerships
>
> 0:00 / 8:03
>
> 5:31
>
> How Apple and Google Formed One of Tech’s Most Powerful Partnerships
>
> How Apple and Google Formed One of Tech’s Most Powerful Partnerships
> Apple and Google have one of Silicon Valley’s most famous rivalries, but
> behind the scenes they maintain a deal worth $8 billion to $12 billion a
> year according to a U.S. Department of Justice lawsuit. Here’s how they
> came to depend on each other. Photo illustration: Jaden Urbi
>
> Write to Patience Haggin at patience.haggin-at-wsj.com, Keach Hagey at
> keach.hagey-at-wsj.com and Sam Schechner at sam.schechner-at-wsj.com
>
>
--
So many immigrant groups have swept through our town
that Brooklyn, like Atlantis, reaches mythological
proportions in the mind of the world - RI Safir 1998
http://www.mrbrklyn.com
DRM is THEFT - We are the STAKEHOLDERS - RI Safir 2002
http://www.nylxs.com - Leadership Development in Free Software
http://www.brooklyn-living.com
Being so tracked is for FARM ANIMALS and extermination camps,
but incompatible with living as a free human being. -RI Safir 2013
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