Apple restricts ad trackers to 24-hour window
Apple is changing the rules for ad tracking through its web browser Safari, in a move that advertisers say will harm their ability to target effectively. Third-party advertisers won't be able to track users for more than 24 hours after they land on a website, once the rules come into effect. Six advertising industry groups have published an open letter warning that the move will severely damage online business, gutting advertisers' ability to categorise users under particular demographics.
Ad industry groups are pissed off at Apple, but there’s not much they can do about it.

Apple is limiting ad tracking in its Safari browser, which will make it harder for ad buyers to target niche audiences. Although this move protects users’ data privacy, it’s likely to hurt advertiser conversions and reduce CPMs for publishers that rely heavily on third-party data.

On Tuesday, Apple will update the operating system of its web browser Safari so users can’t be tracked by third parties for more than 24 hours after visiting a website. In response, six ad industry groups let Apple know they were frustrated, publishing an open letter last week stating that this move will sabotage the internet’s economy. Apple did not respond to a request for comment.

Apple’s Safari update is just the most recent example that displays company’s ambivalence about digital advertising. In 2014, Apple CEO Tim Cook criticized ad supported businesses like Facebook. Last year, Apple shut down its mobile ad platform iAd. While other tech giants like Amazon and Google are growing their revenue by creating new ad products, Apple has fully invested in getting people to pay for products like $1,000 cellphones.

Julie Rezek, North American president at ad agency HackerAgency, said Apple’s restrictions on retargeting data could hurt conversions and reduce reach by making it harder for advertisers to find users who fit specific demographics. Two other ad buyers said Apple’s reduction of third-party tracking will make it harder for them to drive sales and that if their ad performance declines, publishers will ultimately suffer since their CPMs will drop due to a reduction in demand.

But not all publishers will be harmed. Publishers that rely on third-party data vendors to sell the majority of their ads programmatically on open exchanges are most likely to be affected. The issue doesn’t hurt publishers that get most of their revenue from direct sales, said Todd Sawicki, CEO of native ad platform Zemanta.

Just as the General Data Protection Regulation will force advertisers to buy ads on sites with recognizable brands rather than target audiences whenever they wind up on the web, Apple’s data-gathering restrictions could benefit premium publishers not reliant on hypertargeting, said a product head at a comScore 200 publisher.

Although Ranker gets about 90 percent of its revenue through programmatic, Apple’s new rules should only affect 1 to 2 percent of its revenue, said Ranker CEO Clark Benson. This is because Ranker, like many publishers, is ramping up its private marketplace deals where it sells its proprietary data to advertisers. Meanwhile, Apple is clamping down on third-party data collection, which Ranker does not depend on in its PMPs.

By protesting Apple, the trade groups show they’re upholding their members’ interests, said media industry analyst Rebecca Lieb.

“But Apple is uniquely positioned to not care,” said Lieb, referring to how the vast majority of Apple’s revenue comes from selling devices, unlike Facebook, Google and Amazon. If Apple wants to change how users can be tracked in its browser, there’s really no one in ad land who can stop it, she said.

By making advertising slightly more difficult on the web, Apple is playing its card against ad giants like Amazon, Facebook and Google, Sawicki said. But unlike how Facebook algorithm changes can suddenly cut off a publisher’s primary revenue stream, the impact of Apple’s ploy will be more subtle, given that only 4 percent of desktop traffic and 29 percent of mobile traffic runs through Safari, according to NetMarketShare.

“As always in these kind of situations, the industry is saying, ‘The sky is falling,’” said independent ad tech consultant Brad Holcenberg, noting that Google’s Chrome browser is also restricting intrusive advertising by blocking the sound on autoplay videos. “Maybe it is, maybe it isn’t, but the industry has to be prepared to evolve quickly to a more user friendly one. Only a few companies hold the keys to users on the internet, and as [Google and Apple] show, that means changes can come fast and have broad implications.”