Apple's balancing act between data protection and the advertising industry

Apple's balancing act between data protection and the advertising industry

Robert Repnak
Thought byRobert Repnak
September 01, 2021
data protection FFW Agency

Next week, the tech company will release iOS 14.5, the next update for iPhone and iPad. The innovation will severely limit the possibility of device recognition in tracking. If you trust Apple, this means a significant improvement in data protection.

Apple comes by the back door: The tech company had already wanted to prevent device identification (IDFA) when introducing the operating system iOS 14 some time ago. As a matter of fact,  the outcry by the advertising industry was so great that Apple eventually postponed the introduction and added a new API that is important for advertisers. Now, however - with the update of iOS 14.5 - the use of IFDA (The Identifier for Advertisers) is severely restricted. 

But what does this mean?

The internet is based on free services. Only a few web offers manage to sell digital offers to private customers. Nevertheless, the internet works because users leave traces with every step they take on the internet. If you put these traces together, you get to know the users and can, for example, display targeted advertising. Similar to television stations, these free services are financed by advertising. 

Tracking is the magic word for following the traces. Tracking does not only take place via cookies on websites, but also in apps. To get to know users even better, there is tracking that also works across websites or apps. In iOS, for example, Apple has integrated an advertising ID that is valid for each device - the IFDA. This has the great advantage that not a user, but only the device can be clearly identified. Advertising tools have this function integrated. If these are used in different apps, tracking across different apps is thus easily possible. The advertising tools can thus play out the best advertising per user. The apps not only get a simple integration of tracking, but also participate in the advertising revenue. So actually all parties win. The company that places advertisements to sell products, the advertising industry, the app manufacturer and also the users, since they only see relevant advertisements. If they don't want to be tracked, they can turn it all off. 

So is it all good? 

In addition to all the sensible use cases, there are of course also disadvantages. All of the users' data is stored and collected somewhere. Smartphone owners are becoming increasingly transparent and the possibilities for analysis are growing. 

A horror scenario could be that users don't get term life insurance because they bought a parachute.

Or the health insurance company will cancel your policy because you buy too much frozen pizza. In addition, the central storage of data means that there is a risk of data leakage, which means that data could be passed on unintentionally. Suddenly the neighbour knows that I bought a saw, purely by chance, just before the branch of his tree was sawn off...

data protection ffw agencyAs a user, you hardly have the possibility to check which tracking is used in which app. Not even developers know exactly what is contained in the tracking code. Prefabricated libraries are simply used. The high pressure to innovate and the fast development cycles support the trend of integrating unchecked libraries. This makes it easier and easier to misuse user information.

So Apple has now decided to further restrict cross-app tracking. In order for an app to use the IDFA, users must first agree to it. What's new about Apple's approach, however, is that the operating system takes care of ensuring that users give permission to access the IDFA. This is called opt-in. Users therefore have the opportunity to decide in advance. Previously, it was only mandatory to be able to switch off the use of the IDFA (opt-out) . 

Apple admittedly has a strong interest in advertisers continuing to support the iOS platform, but is now putting its own platform and thus also data protection in the foreground. The compulsion to use a pure opt-in mechanism is particularly obstructive in the area of measuring the success of advertising campaigns (conversion). However, Apple has taken precautions here and provided a new framework for developers, which aims precisely in this area. 

Apple has a business model that is only partly based on advertising. Apple stands for digital products and a sophisticated infrastructure that seamlessly links the various products. Users should be able to move easily and securely in the digital world. By restricting the use of device recognition and enabling more anonymous tracking of advertising campaigns, Apple is trying to strike a balance between data protection and the advertising industry. 

Every step towards giving users more control over their data is to be welcomed. 

Apple intervenes in the communication between users and advertisers and promises anonymisation. If you trust Apple, this will lead to a strong improvement in data protection.