Apple's App Tracking Transparency feature (ATT) requires that iPhone users who want to be tracked by third party apps for the purpose of receiving online ads, opt-in to continue being tracked. By default, iPhone users will not be tracked. The feature will launch with the release of iOS 14.5 this coming spring. When Apple first announced this feature, Facebook said that it expected most iPhone users not to opt-in for third-party tracking. This would seriously hurt small businesses Facebook said, and the social media firm paid for two full-page ads to run in major newspapers. In the ads, Facebook wrote, "Many in the small business community have shared concerns about Apple's forced software update, which will limit businesses' ability to run personalized ads and reach their customers effectively."
Zuckerberg does a 180-degree reversal; says Apple's ATT feature could actually benefit Facebook
Some believe that the truth of the matter is that Facebook is more concerned about its own finances. For all of 2020, Facebook grossed $84.17 billion from advertising which means that it faces a huge hit if ATT does the damage to small businesses that Facebook at first said that it would do. However, it appears that Facebook co-founder and CEO Mark Zuckerberg has had a change of heart. In a Clubhouse room earlier today, Zuckerberg said that Facebook might find itself in a stronger position once the App Tracking Transparency feature kicks off. The executive said that Facebook will "be in a good position," and added that "It’s possible that we may even be in a stronger position if Apple’s changes encourage more businesses to conduct more commerce on our platforms by making it harder for them to use their data in order to find the customers that would want to use their products outside of our platforms." Facebook said back in January that Apple's new feature could start impacting its numbers late in the current quarter.
When Apple announced its plans last year, Facebook launched Facebook Shops and Instagram Shops. This allows companies to list products for sale on Facebook's two most popular apps and help them sell directly via Facebook and Instagram. Today, Zuckerberg said that Facebook has 1 million active shops on its services with 250 million people using the Shops actively. The executive added, "Compared to the early conversations we had about how people would use this across Facebook and Instagram and our product, I think this is something that’s well on track to be something that’s going to be increasingly important to people." He also said that Facebook "will be able to manage through" Apple's planned privacy update.
Facebook also has had to deal with Apple's privacy labels. The labels, found in the App Store after each app's "Comments" section reveals which data collected by an app can be used to track you across websites, and which data can be used to determine your identity. According to cloud storage firm pCloud, the two iOS apps that collect the most personal data from iOS users are Facebook and Instagram. This was determined by looking at the privacy labels to see what data each app collects from users. Why do apps collect this data? According to pCloud, "Apps collect your data for a lot of reasons. One of the initial reasons for this is to make your experience better, tracking how you interact with them to fix bugs and improve how they work. However, they also use your information to target you with ads across any platform."
Zuckerberg's reversal was certainly a surprise considering how hard Facebook blasted Apple last year. In December, Dan Levy, Facebook Vice President for Ads and Business Products, told reporters that"Apple is behaving anti-competitively by using their control of the App Store to benefit their bottom line at the expense of creators and small businesses. Full stop."