Facebook claims that privacy changes in the next version of Apple's mobile operating system will affect app makers' ability to make money from targeted advertising.
For iOS 14, which will be released in the fall, apps will have to ask users for permission to collect and share data using Apple's device identifier.
Facebook and other advertising networks rely on this device identifier to keep track of where users go online, what they do, and what they buy in order to deliver targeted ads.
The social media giant fears that many iOS users will reject tracking given the choice and affect not only their own advertising business, but also all app manufacturers and publishers who use the Audience Network.
Via the Audience Network, Facebook and Instagram advertisers can place their ads elsewhere on the Internet.
Facebook claims the change in iOS 14 could cut the amount publishers earn from targeted advertising in half and force the company to shut down its Audience Network altogether.
Apple said the goal is to give people more choice about how companies want to be tracked on the internet – and the ability to say no if they don't want tracking.
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Apple's upcoming iOS 14 is said to include privacy features that prevent companies from tracking users across different apps – and Facebook isn't moving lightly. Social media criticize the changes, claiming that their ability to target ads to iPhone users will be "limited" and will have a significant impact on sales
In the future, users will have to explicitly give permission for advertisers to track them
In a blog post, Facebook announced that changes were being made to its own apps to help advertising partners prepare for the changes for iOS 14.
The identifier for advertisers in their own apps for iOS 14 devices is no longer recorded.
Also, companies are encouraged to create new ad accounts dedicated solely to serving ads for apps for iOS 14 users in order to comply with Apple's new rules.
The company said these changes would likely have a disproportionate impact on its audience network as it relies heavily on app advertising.
"As with all advertising networks on iOS 14, the ability of advertisers to accurately target and measure their campaigns on the Audience Network will be compromised. As a result, publishers should expect their ability to make effective money on the Audience Network diminishes," said the company Companies.
According to Apple, app developers must now ask for permission before tracking users in order to improve privacy and give users control over their own data
While the Audience Network business is a major source of revenue and traffic for small developers like game companies, it is a far cry from Facebook's largest business, said Brian Wieser, global president for business intelligence at GroupM.
"I would be surprised if it was more than $ 1 billion net," he said.
The company makes most of its money serving ads on its main app and image sharing network, Instagram.
However, Facebook notes that it would lose more than 50 percent of its publisher revenue on the Audience Network if it were to remove personalization from campaigns for mobile installation.
"We know that iOS 14 will hurt many of our developers and publishers in an already difficult time for companies," said Facebook on the blog.
& # 39; We work with 19,000+ developers and publishers from around the world and paid billions of dollars in 2019.
"Many of them are small businesses that rely on ads for a living."
Facebook's argument is the result of iOS 14, including blockers that forbid websites from monitoring smartphone owners without their permission using their unique identifier (IDFA)
APPLE IOS USERS WILL NOT RECEIVE THE NEXT FORTNITE UPDATE
Player of the popular game & # 39; Fortnite & # 39; no updates on iPhones.
It comes after Epic Games declared "monopoly" on Apple's app store on Wednesday, saying it won't be removing a direct payment feature.
Litigation erupted after Epic launched its own method of in-game purchases for Fortnite on Apple's App Store earlier this month.
This happened instead of the in-app purchase system required by Apple, which charges commissions of 30 percent.
Apple then removed the game from the App Store. However, users who already have it installed can still play the game.
Judge Yvonne Gonzalez Rogers of the U.S. District Court for the Northern District of California allowed the iPhone maker to keep Fornite out of its business until Epic complies with Apple's request to resubmit the app without the direct payment feature.
The judge's reasoning was that Epic would not suffer “irreparable harm” if the direct payment feature were temporarily removed while the case against Apple continued.
"We agree with Judge Gonzalez Rogers that" the sound practice "is for Epic to adhere to the App Store," Apple said on Tuesday.
In a blog post on Wednesday, Epic said it was basically inconsistent with Apple's payment rules and would not resend "Fortnite" to the App Store without the direct payment system.
"Your proposal is an invitation for Epic to work with Apple to maintain the monopoly on in-app payments on iOS, suppress free market competition and increase prices," Epic wrote in the post.
"In principle, we will not take part in this program."
The changes in iOS 14 are affecting not only Facebook, but also the revenue streams of other advertising networks like Google AdMod, game makers, news publishers, and app developers, all of whom use tracking to make money from ads.
"Apple's changes to iOS 14 will certainly have a negative impact on the way game studios and publishers are currently generating revenue and attracting users through sales-driven advertising," said Renee Gittins, executive director of the International Game Developers Association.
John Nardone, executive director of ad serving software company Flashtalking, said Apple's move to curtail its ad business could be seen as anti-competitive by increasing prices for consumers who are used to free, ad-supported apps.
"There is a self-interest in Apple to do this because the more difficult it is for advertising revenue, apps have to bill users and Apple, as you know from the Epic Games case, takes 30 percent of that," Nardone said.
"Apple is not involved in ads, but in paid apps."
The burden could be less for publishers, said David Chavern, president of the News Media Alliance, which represents several major US publishers.
Many rely on so-called first-party data, e.g. For example, what stories a user reads to determine which ads to show. This activity is not subject to Apple's new rules.
"News publishers aren't big beneficiaries of cross-app tracking, and in general we all see the ecosystem moving against targeted programmatic ads," he said.
"This could bring benefits for publishers, such as a return to contextual advertising."
Julia Beizer, head of digital at Bloomberg Media, however, expressed concern that Apple is trying to change digital advertising itself.
& # 39; We all want to create a better, privacy-safe web. However, if you roll it out without consulting the industry, you're asking publishers to shoulder the brunt of the sins of ad tech. Which is not fair, ”she said to Recode.
Apple is expected to release its new iOS 14 operating system along with new iPhones this fall. However, the exact date has yet to be announced.
The company has seen its fair share of tangles in recent months. This month, Apple removed the popular Epic Games Fornite from its app store because the game maker violated its app payment guidelines
The Silicon Valley company has seen a fair share of entanglements in recent months, many of which have been burdened over 30 percent of developers.
This month, Apple removed the popular Epic Games Fornite from its app store because the game maker violated its app payment guidelines.
And on the same day, Epic served Apple a lawsuit demanding the return.
The latest update of the fiasco comes from a US federal judge who gave Epic Games an injunction against Apple that prevents the iPhone maker from shutting down Epic's Unreal Engine computer graphics software.
The Unreal Engine and its license are used by hundreds of app developers, not just Epic, and would cause tremendous disruption to the gaming industry.
The judge ruled that because of the dispute between Fortnite, Epics Marquee Game, and Apple, there is no basis to block access to other branches of its business that are used by numerous parties not involved in the litigation
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