Apple could take away apps that observe customers with out permission in 2021

Craig Federighi, Apple’s senior vice president of software engineering, speaks during a new product announcement at the Apple Worldwide Developers Conference on Monday June 4, 2018 in San Jose, California.

Marcio Jose Sanchez | AP

Starting next year, Apple will be removing apps from its app store that are tracking users without prior permission. This promises to strengthen iPhone users’ privacy but is likely to shake the app advertising industry.

To target advertisements and measure their effectiveness, app developers and other industry players currently often use an IDFA (Identifier for Advertisers) or a sequence of letters and numbers that is different on each Apple device.

In an update to the iPhone operating system, which is expected “early next year,” app manufacturers must ask for permission to access a user’s IDFA via a popup. A significant proportion of users will likely choose to opt out, which will reduce the effectiveness and profitability of targeted ads. The change takes a privacy option that was previously buried in Settings and brings it to the fore when users open each app.

On Tuesday, Craig Federighi, Apple’s senior vice president of software development, said apps that do not meet the new requirements that Apple calls App Tracking Transparency (ATT) can be removed from the App Store. This is the only way to install software on an iPhone.

The move puts app developers who make money from targeted ads versus Apple, which has increasingly built privacy features into its products to set them apart from the competition. Among the critics is Facebook, which said the change could cut sales in one of its advertising stores by 50%.

“Some in the advertising industry are opposing these efforts, claiming that ATT will cause ad-supported businesses to suffer dramatic damage. However, as with the introduction of intelligent tracking prevention, we expect the industry to adapt and deliver effective advertising without invasive tracking “said Federighi in a speech at a European data protection conference.

Some examples of the tracking that Apple says app makers would need to get user permission first:

  • Show targeted advertisements in apps based on user data collected from apps and websites of other companies.
  • Share device location data or email lists with a data broker.
  • Share a list of emails, promotional IDs, or other IDs with a third-party ad network that will use the information to refocus those users in other developer’s apps or find similar users.

“Early next year we will need any apps that want to do this in order to get explicit permission from their users, and developers who do not meet this standard can have their apps removed from the App Store,” said Federighi.

The disclosure that Apple can remove non-compliant apps also raises the stake for a date expected early next year when app developers will have to specifically ask permission to use IDFA to perform tracking, forcing developers to rebuild part of their ad targeting systems to meet Apple’s requirements.

According to StatCounter, Apple’s iPhones make up just over 25% of smartphones worldwide, but the market share is higher in countries like the United States. In addition, iPhone users are often wealthier and viewed as more valuable customers. When app developers are removed from the app store, they lose a huge market.

Apple’s ATT is the latest in a series of steps reducing advertisers’ ability to collect data about iPhone users. In 2017, Apple introduced a feature called ITP that uses machine learning to block ad trackers in the Apple Safari browser. On Tuesday, Apple asked app developers to submit a detailed questionnaire about its privacy practices and the data they and third-party partners collect before being approved on the App Store.

Apple has been criticized on both sides of the IDFA issue. In France, advertising firms and publishers filed a competition complaint in October alleging that the proposed move away from IDFA is using privacy as cover for anti-competitive behavior to harm smaller tech companies.

Last month, Apple was also hit by complaints from activists in Europe that IDFA – the current system – did not comply with European data protection laws.

“We have postponed the release of ATT until early next year to give developers the time they have given to properly update their systems and data practices. However, we are still fully committed to ATT and our comprehensive approach to privacy obliged, “said Jane Horvath, senior data protection officer at Apple, replied.

Apple has not publicly announced when ATT will take effect.

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