Privacy: Facebook Faces New Challenges, And Apple Virtue Signals

A news item in TechCrunch details how Facebook is testing how to link users’ accounts with their subscriptions to newspapers and magazines: when the social network detects that the user is subscribed, it allows the news accessed within Facebook to be displayed in full and without restrictions, in addition to recommending more news from that same medium. The company said it had seen a 111% increase in clicks on articles, and between a 34% to 97% probability that the user decides to follow publication in question.

Facebook’s business model hasn’t changed: it still continues to manage its users, extracting the maximum amount of data it can from them. From its origins as a social network to keep people in touch, Facebook has been evolving towards a model of user quota capture, trying to get people to spend as much time as possible on the social network and do as much as possible there. When you consume news within Facebook, you are giving the company a very rich information profile about the topics that interest you, and enabling better targeted and increasingly profitable advertising. This is also useful for the company, because it means knowing more about the topics that are likely to polarize or influence users (in gradients based on your reactions, such as “reads it” versus “reads it and comments on it”, “reads it and reacts with an icon” or “reads it and shares it”), which is enormously valuable in election campaigns.

But Facebook now faces a major obstacle: the next version of iOS, Apple’s operating system, which offers users much more complete information about how apps track their information. With a warning on your smartphone asking you to choose between “Allow tracking” or “Ask app not to track” your advertising ID (IDFA), it’s likely that the number of users who will choose to allow tracking will plummet. In response, is not just complaining about the control Apple has over its devices: it has decided not to collect the IDFA for any of its own apps on iOS 14 devices or to request the IDFA from apps in Audience Network. Neither will Facebook display Apple’s consent prompt or ask that apps in Audience Network do so on its behalf.

Unfortunately for Facebook, the rate of upgrading to the latest version of the operating system is typically very high, which means that, in a short period of time, the performance of many of their campaigns can be severely impaired.

On the other side of the advertising ecosystem, in the web environment dominated by Google, things don’t look much better either: the majority browser, Chrome, has announced that it will stop supporting third party cookies in 2022, which could deprive Facebook of visibility over users’ navigation on other pages, particularly those that incorporate the company’s mechanisms such as likes or comments.

If advertising on the web starts to suffer because those who own the browsers decide to make it more difficult, and in apps you find that those who control a part of the terminals — even if it is the minority in many countries — do the same, Facebook can expect problems. And in fact, the company has already started to warn its shareholders about these issues in the notes accompanying its results for the second quarter of 2020.

Given that Apple now sells itself as the company that protects user privacy and that could, in fact, be developing its own search engine to compete with Google, Facebook’s position will be weakened even further: the prospect of a significant segment of users switching to a different search engine focused on protecting privacy is a circumstance that for Facebook, whose business model is about exploiting privacy, doesn’t sound good at all.

Things are rarely black or white, and Apple has been criticized for “grandstanding” over privacy while enabling the data economy it supposedly opposes, but in this battle and knowing the background to events, I know which side of the fence I’m still on.