Meta (Facebook) continues to feel the impact of the privacy measure that Apple announced in iOS 14.5 and will continue to do so in the coming months. David Wehner, CFO of the company, has assured that the possibility for iOS users to choose whether or not an app can track them, will result in a loss of 10,000 million dollars in revenue related to advertising during 2022. Wehner has also accused Apple of having a favorable deal with Google.
This privacy measure that came with iOS 14.5, called “App Tracking Transparency”, allows you to prevent apps from tracking users. Something that prevents Facebook and other companies from displaying advertising related to what that person usually searches for on their smartphone. This translates into a lower number of revenues , since many of the ads that are displayed will not be of interest. Although Meta has always been against App Tracking Transparency, defending that it mainly harms small businesses that decide to advertise through its platforms, the privacy function also directly affects the company itself.
“We think the impact of iOS overall as a headwind to our business in 2022 is in the order of $10 billion. So that's a pretty significant headwind to our business.”
Says David Wehner, CFO of Meta.
Meta and other platforms report losses, while Google announces income
Source: Unsplash. The measure not only harms Facebook, but also other social networks and platforms in which advertising is an important part of their business. However, Google noted an increase in this area, with 33% more revenue compared to the same period of the previous year. Webber suggests this year-over-year growth is due to the Mountain View firm having “a different set of restrictions from Apple.” That is, a favorable treatment that could be caused by the fact that Google Search is the default search engine in Safari.
According to Meta's CFO, App Tracking Transparency restrictions don't seem to apply to browsers. Therefore, Google can continue to show advertising that is related to what its users search for on the Internet. Google, in addition, pays a high amount to Apple so that its search engine is displayed by default on iOS. Webber believes that these revenues for the Cupertino company from Google are an incentive for “this political discrepancy to continue”.
“We believe that Apple's restrictions are designed to exclude browsers from the tracking that Apple requires in other applications. Which means that search ads could have access to much more third-party data, for measurement and optimization purposes, than those with app-based advertising platforms like ours”.
Confirms David Wehner.
