It's been said that data is the oil of the 21st century that's because just like traditional crude oil in years gone by data is a vast incredibly valuable and still a predominantly untapped resource and crucially powerful interests now seem to think it's worth going to war over.
Now, the battle for control over our online data reached boiling point with a pair of titans making power moves hoping to secure access to it over the coming years. So today we're strapping on our flak jackets and wading onto the battlefield. So we can examine the so-called privacy war kicking off right now between Apple and Facebook. Facebook has built a phenomenally successful and lucrative business over the past decade and a half.Although it's not necessarily obvious how Facebook makes money after all unlike say Spotify or Netflix. Facebook demands no monthly subscription with no in-app purchases from its astonishing 2.7 billion strong user base.
You scroll, You post, You like and it's all free right? of course! It isn't advertising is how Facebook stays rich; specifically through ads that are hyper targeted using insights extracted from Facebook's colossal cache of user data. Suppose you're a florist looking to attract new clients you could take out an ad in the classified section of your local newspaper where lots of people might see it but maybe not the right people or alternatively you could spend your precious marketing budget on Facebook. There for a fee your ad will be expertly slotted into the news feeds of prospective brides or say the local peony appreciation group. It's a no-brainer and has been for quite some time now. However Facebook's slick business model might soon be upended because coming soon, Apple plans on updating its IOS software to make data privacy a more visible issue for users.
According to some estimates there's around a billion iPhones out there which will instantaneously be subject to the change not to mention tens of thousands of iPads.
So what will the change look like from next year? Whenever Facebook updates its app users will be asked to opt in to its information harvesting program on a data point by data point basis that means you as an iphone user will be asked specifically if you're happy for Facebook to continue collecting data on your specific whereabouts say your spending habits or your marital status. This is obviously the very information that makes Facebook's ad platform so devastatingly effective and the company's ability to extract it from you seamlessly is crucial to Facebook's bottom line.
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Unsurprisingly Facebook is strongly opposed to this incursion on its turf and is fighting the move in a very public fashion. Facebook took out full page ads in the Washington Post, New York times and Wall Street Journal newspapers in bold type. The ad thundered that Apple's proposed changes would limit businesses ability to run personalized ads and reach their customers effectively. According to the ad some 44 percent of small or medium-sized businesses increase their social media ad spend this year and it continued if Apple's changes are allowed to go ahead. The average small business advertiser stands to see a cut of over 60 in their sales for every dollar they spend. That's a strong message underlined by the tag line “stand up for the small” which is perhaps a little bit rich for a company that's currently worth three quarters of a trillion dollars.
Still Facebook points to data, suggesting that around half of US diners for instance have tried a new restaurant for the first time based purely on the strength of a social media post. There's little doubt that Facebook ad campaigns for better or worse are now an integral part of any small business marketing strategy.
So what's Apple's position as opposed to Facebook and for that matter Google whose business models hinge on providing a great service while glossing over the uncomfortable truth that private data pays for it all.
Apple trades on its transparency, Apple products might set you back a pretty penny the argument goes but what you see with Apple is exactly what you get so even though Apple knows what you buy on Apple pay or what you play on Apple arcade or what you watch on Apple TV, the Cupertino tech giant never harvest your data for nefarious commercial purposes.
Privacy is therefore just another luxury enjoyed by Apple customers, like Rose Gold Tinting and it's very easy for the company to at least appear as if it holds the moral high ground here. In a statement issued in response to those full page Facebook broadsides, Apple plaintively outlined its belief that this is a simple matter of standing up for our users. Users should know when their data is being collected and shared across other wraps and websites and they should have a choice to allow that or not.
App tracking transparency in IOS 14 gives users a choice. Facebook for its part understands all too keenly that if a user is asked, “do you want us to extract your personal data”? that user will most likely click no and the grim feeling in Mark Zuckerberg's office is that this will affect Facebook's ability to sell ads. Ultimately this would also hamper the sophistication of Facebook's industry-leading algorithms.
Less data in Facebook's view means a less complete picture of what we all want which in turn impacts the quality of service we enjoy.
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So Facebook's legal approach is to paint Apple as a tyrannical monopoly acting with callous regard to the little guy in this case for instance, a florist who's now less well-equipped to flog posies to neighborhood blushing brides all of whom have by now radically adjusted their privacy settings.
Facebook is also joining forces with Fortnite developer Epic in a separate legal battle. Epic filed suit against Apple last year over Apple's deletion of Fortnite from the app store. Epic cheekily introduced an in-game payment system that sought to bypass Apple's customary 30 cut and so Apple unceremoniously pulled the game from its online storefront. That trial is set to be heard before a judge and should be an extremely hot-headed affair.
With Facebook's commercial and PR cloud now in the mix, the outcome of this skirmish matters on one hand how easy should it be for firms like Facebook to harvest our user data in order to sell stuff. On the other hand how much power should hardware giants like Apple wield over what rival companies can and can't do and with brand new immersive data heavy tech like Augmented Reality coming fast down the pipelines of both firms, it's clear that the battles presently being fought over the oil of the 21st century are only just getting started.
What do you think? Who is right here, Apple or Facebook? Comment down your views below.
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