Facebook’s dispute with Apple is ending with a dispute over Apple’s new privacy feature that would limit the scope of specific ads, highlighting the contrasting but symbiotic nature of the business giants of the two tech giants.
Apple plans to launch a feature early next year that will require apps sold in its store to ask users for permission to track their data, extending the extended privacy features already released. The update has been advocated by technology advocacy groups, such as Digital Rights Ranking, who cite it as a vital step toward data protection and transparency.
But Facebook, which thrives on selling targeted ads, criticizes the update with an ad campaign that marks Apple’s move as focused on profit, not privacy.
“It will force companies to resort to subscriptions and other in-app payments to earn revenue, which means Apple will make a profit and many free services will have to start charging or exiting the market,” said Dan Levy, vice president of advertising and Facebook business products. blog entry Wednesday.
Apple has backtracked on Facebook claims, duplicating that the measure is aimed at improving privacy, while also supporting Facebook user data collection.
“We believe that this is a simple matter of defending our users. Users should know when their data is being collected and shared among other apps and websites, and they should have the option to allow it or not, ”Apple said in a statement. “The transparency of app tracking in iOS 14 doesn’t require Facebook to change its approach to tracking users and creating specific advertising, it simply requires them to give users a choice.”
Facebook stepped up its fight against Apple this week, coming out Wednesday with a new website and newspaper ads claiming that Apple’s upgrade will hurt small businesses. Separate ads released on Thursday argue that the measure will also harm consumers, causing companies to start charging fees for free services earlier to offset lost advertising revenue.
“Obviously, Facebook does this in its own interest,” Elizabeth Renieris, chief policy analyst at Digital Rights Ranking, told The Hill, noting that the platform’s client is not a private individual, but an advertiser.
“They use the tag ‘Defend Yourself for Small [National Federation of Independent Business] or the Chamber of Commerce backs down against these changes. That feels absurd, ”he added.
The Small Business Administration, the NFIB, and the U.S. Chamber of Commerce did not respond to any comments.
Levy acknowledged that the update would hurt the diversified ad business owned by Facebook, but wrote in the blog post that the effect on Facebook will be “much lower than it will affect small businesses.”
In a call with reporters, Levy also accused Apple of behaving anti-competitively with the upgrade in order to benefit from Apple’s app store.
The accusation comes as both Facebook and Apple, along with Google and Amazon, have faced greater control over market power.
Earlier this month, 48 attorneys general filed a lawsuit accusing Facebook of anti-competitive acquisitions. Facebook defended itself and noted that the acquisitions in question, from WhatsApp and Instagram, were approved by regulators at the time.
While Facebook and Apple are two of the largest technology companies, they have proven business models that are at the center of their conflict.
Facebook is based on providing free online services to users, earning money through ads posted on their platforms. Apple is based on charging consumers and relying less on advertising revenue.
Despite their conflicting models, both companies rely on each other to reach consumers.
“The problem for Facebook, yes [has] a kind of this strange symbiotic relationship [with Apple]”Ryan O’Leary, a senior research analyst at the International Data Corporation (IDC), told The Hill.
Facebook needs Apple’s iOS platforms to reach users, he said. Similarly, Apple runs the risk of losing users if it doesn’t have Facebook-owned apps available to customers.
The update, announced as part of a new set of privacy features introduced in June, was due to be released as part of the iOS14 update in September. But later, Apple delayed the upgrade by saying it would give developers time to upgrade their systems and data practices.
The battle for the anti-tracking function adds to a year-long dispute between major technology companies.
In 2018, Apple CEO Tim Cook criticized Facebook for its data privacy practices amid reports that Cambridge Analytica collected data from 50 million Facebook users without their permission.
He was then asked what he would do if he were CEO of Facebook Mark Zuckerberg
Mark Elliot ZuckerbergHillicon Valley: Lawmakers call for action after “devastating” cyberattack on federal government | US cyber agency issues emergency directives after hackers | FTC opens a privacy study on major Internet platforms. Facebook faces threat of most serious breach of lawsuits 46 states and FTC files antitrust lawsuits against Facebook MORE, Cook replied, “I wouldn’t be in this situation.”
“We could make a lot of money if we monetized our customers. If our customers were our product,” Cook said in the same interview with Recode and MSNBC.
“We are concerned about the user experience. And we are not going to traffic your personal life. I think it’s an invasion of privacy, “he added.
Zuckerberg fired back in an interview shortly after Cook, defending the Facebook model that created a more accessible Internet service.
“You know, I think this argument is that if you’re not paying for it in some way, we can’t worry about you, it will be extremely frank. And nothing aligned with the truth, “Zuckerberg told Vox.
“The reality here is that if you want to create a service that helps connect everyone to the world, there are a lot of people who can’t afford to pay. And so, as in many media, having an advertising model is the only rational model that can help build this service to reach people, ”he added.
The struggle has gone beyond top executives who trade barbs.
Apple rejected at least five versions of a Facebook gaming app between February and June, The New York Times reported. Apple reportedly cited its rule banning apps for the “primary purpose” of distributing casual games.
Now, Facebook said it is also ready to lend a hand to another company that has Apple: Epic Games. The company behind the popular video game Fortnite filed a lawsuit against Apple this summer accusing Apple of violating antitrust laws by requiring developers to use Apple’s payment system.
Facebook’s director of privacy and public policy, Steve Satterfield, said Wednesday that the social media giant is ready to support Epic Games’ lawsuit against Apple and provide all the relevant information in the lawsuit.
The controversial relationship between Facebook and Apple is likely to stand out even more in the coming months, as US and European lawmakers crack down on tech companies. Regulation in many ways has been a long time, O’Leary said.
“Consumers did not understand that they were the products until the situation was too advanced. The cat was a little out of the bag and was difficult to recover, “he said.
On Tuesday, the European Commission unveiled new content and competition rules. The proposed digital marketing law focuses on so-called “gatekeepers” and companies that do not comply with the new rules may receive high fines or be forced to sell parts of their business.
Renieris, however, in fighting the attacks on each other, Facebook and Apple show their market powers as goalkeepers.
“They are having this very public struggle and they are basically staying that way [that] it subjects them to quite serious regulation, ”he said.