The Privacy Feud: Facebook vs. Apple and What You Need to Know

The latest Apple iOS will let you know if an app would like to track you. Facebook isn’t a fan.

Let’s get ready to rumble! Facebook and Apple are sparring over privacy.

A privacy release this week for Apple’s popular iPhone has triggered a war of words in Silicon Valley.

The iPhone rolled out update  iOS 14 operating system this week which now prompts users to give apps permission to track their activity across other apps and the web. That update, which Apple calls App Tracking Transparency, could be viewed as minor. Most apps are known to track our web activity via default settings we accept upon installation.

Facebook, however, is quite upset about the update, which jeopardizes the source of its $86 billion in annual revenue: targeted ads.

Gasp.

The social network has waged a months-long crusade against Apple, publishing full-page ads in national newspapers and experimenting with pop-ups inside the Facebook app to persuade users to accept this tracking. It’s also suspected that Apple’s updates are devised to help the iPhone maker’s own business, rather than protect consumer privacy.

Gasp.

“Apple may say that they’re doing this to help people, but the moves clearly track their competitive interests,” Facebook CEO Mark Zuckerberg said in January during the company’s fourth-quarter earnings call. Apple CEO Tim Cook says the change is established in the company’s principle that “users should have the choice over the data that is being collected about them and how it’s used.”

The dispute underscores a fundamental difference between the tech giants: how they make profits.

Apple offers smartphones and laptops and is paid a referral fee charged to app developers. Facebook sells ads it can target specifically based on the trove of data it collects on its 2.8 billion monthly users. Those business models advise their approach to privacy.

So, last June, Apple began to inform us at its annual developers’ conference that it would introduce a feature to iOS requiring users to provide apps with permission to track them across various apps and websites. Most users are clearly unaware of this tracking because it’s buried in the terms of service or privacy policies. Who reads those?

With the iOS update, iPhone users will see a pop-up that clearly states an app wants to track them. Facebook utilizes this data to show people personalized ads. The pop-up also provides an opportunity to opt out of tracking. Many are waiting with bated breath to opt out of this. 

Facebook made it publicly known it was clearly unhappy with Apple. It was splashed all over The Wall Street Journal, The New York Times and The Washington Post arguing that Apple’s update will harm small businesses and consumers.

While consumers may be jumping for joy now, they may not be so happy in the weeks and months to come when their normally free apps are forced to start charging. Dan Levy, who runs Facebook’s ad business, said in a blog post that Apple’s policy change is “about profit, not privacy.” He said:

the iOS update would force some apps to turn to in-app purchases and subscription fees, from which Apple can take a cut of up to 30%.

While Facebook has a poor track record when it comes to user privacy already, it seems unlikely that users will give it permission to track them. Its reputation for protecting privacy was tarnished by the 2018 scandal relating to Cambridge Analytica, a UK political consulting firm that harvested the data of up to 87 million users without their permission.

In the end, Zuckerberg defends Facebook’s business model, saying ads allow the social network to offer the site to its users at no charge. “If we’re committed to serving everyone, then we need a service that is affordable to everyone,” he said in a 2019 op-ed in The Wall Street Journal.