Facebook Hits Apple (Again) Over iPhone User Tracking Changes

A new chapter in Facebook and Apple’s fraught history emerged on Wednesday as the former snapped at the latter in newspaper advertisements, a company blog post and press briefing over upcoming changes to the iPhone.

At the heart of the latest drama is an iOS 14 update likely to stymie targeted advertising: Users will need to grant clear and specific permission before they can be tracked. The opt-in comes via a privacy setting that was once buried, but will soon pop up when users open an app.

The announcement thrilled privacy wonks and civil liberties advocates, but raised major concerns from companies like Facebook, which rely on ad targeting.

The social media company placed ads in the New York Times, Wall Street Journal and Washington Post taking aim at the “forced software update,” explaining that the new permission structure would cause harm to small businesses.

It then continued the theme on a press call and a blog post on Wednesday, accusing Apple of “behaving anti-competitively by using their control of the App Store to benefit their bottom line at the expense of creators and small businesses,” according to Dan Levy, who runs Facebook’s small business initiatives.

Apple didn’t immediately respond to a request for comment.

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This is not the first time Facebook has complained about this update, but Wednesday’s actions represent an escalation as the launch nears. Apple typically rolls out major platform updates in the fall, but decided to hold off this time until early 2021, so developers have more time to adjust.

Facebook often casts itself as a helper of small and medium-size businesses, especially when talking about some of its key coronavirus-era features and campaigns.

When Paid Online Events debuted a few months ago, Facebook wanted to make a grand gesture of offering the feature for free in the first year. The idea was to give businesses a way to pull in revenue without worrying about fees, but Apple’s typical 30 percent cut of transactions was a wrinkle in the plan — so Facebook launched a media campaign, essentially accusing the iPhone company of money-grubbing tactics.

In the end, Apple compromised, suspending its cut of transactions for the Facebook feature through the end of 2020.

That’s probably not going to happen again this time around.

Just as Facebook fashions itself as a defender of small businesses, Apple aims to set itself apart as a champion of user privacy, unlike other tech companies.

It’s a jab, but not a surprising one, considering Apple chief executive officer Tim Cook and Facebook’s Mark Zuckerberg have been frenemies for years.

Their companies rely on each other, to the extent that Facebook’s apps are key attractions for Apple users — Facebook is a marquee app partner integrated into several base iPhone-sharing features — and the social media company, which has more than 2.7 billion users, couldn’t have the same reach without the iPhone.

But it’s an uncomfortable relationship, and it’s been that way since at least 2014, when Cook trashed Facebook and Google’s business models in a media interview.

At the time, Cook said, “I think everyone has to ask, how do companies make their money? Follow the money. And if they’re making money mainly by collecting gobs of personal data, I think you have a right to be worried. And you should really understand what’s happening to that data.”

The Apple ceo has reiterated the sentiment several times, including this year in interviews and Congressional testimony. In 2020, that may matter more than ever, as these same business models put Facebook, Google and other tech titans in the center of a firestorm of regulatory scrutiny. The U.S. and Europe are now on the brink of overhauling their approaches to Big Tech.

Privacy, transparency in how user data is handled and the outsized market power of major tech platforms have emerged as the major trifecta of tech issues this year, and that puts the Facebook-Apple feud into context.

Apple jabs at Facebook over how it tracks people and monetizes that data. Facebook, itself the subject of a lawsuit by state and federal regulators for alleged anticompetitive behavior, accuses Apple of hypocrisy, as well as abusing its power over the growing economy of the iOS platform and App Store.

In its blog post, the social giant laid out the basis of its criticism over the coming software update in four bullet points:

• “They’re creating a policy — enforced via iOS 14’s AppTrackingTransparency — that’s about profit, not privacy,”

• “They’re hurting small businesses and publishers who are already struggling in a pandemic.”

• “They’re not playing by their own rules,” with a note about Apple’s personalized ad platform not being subject to the new iOS 14 policy.

• “We disagree with Apple’s approach, yet we have no choice but to show their prompt.”

It’s a spat of epic proportions, as incredibly high stakes are attached to it. And not just for these companies, but also for the consumers and brands that must rely on these platforms, now more than ever. With this, 2021 looks poised to be a year of escalating tensions and high drama in what’s shaping up to be — to borrow from President-elect Joe Biden’s campaign speeches — a potential new battle for the soul of technology.

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