No Such Thing as a Free Lunch?

By Emily Leach

The internet is not free. Trust that if you’re online and you’re not paying money to visit the site you’re on (and most often this is true even when you are) you are paying with your data.

Think of it as a barter economy — you get the benefit of the website or app in exchange for that company getting your data. And, if you think about it, that’s a pretty sweet deal for you — the internet is amazing! The problem with this agreement is that it has largely happened outside the awareness of the consumers whose data is the currency driving the engine. And as more consumer data is generated and collected and ways to monetize that data evolve and multiply, that tradeoff has increasingly advantaged companies over consumers.

“Notice and choice” has been the modus operandi of privacy for many years now. However, “notice” has almost always meant bury your data practices in a 5,000-word privacy notice full of ambiguities and legalese that no one ever reads. And “choice” has frequently meant, if you don’t like what we do with your data, you don’t have to use our site. This is particularly true in the U.S., where there is no overarching privacy law like there are in many other countries.

Recently, Apple announced that its latest release provides consumers a new and improved version of notice and choice: App Tracking Transparency, or ATT. After installation of the newest iOS, iPhone users will see a pop-up whenever they open an app that wants to access their “Identifier for Advertisers,” also known as IDFA. The pop up will ask them if they want to opt in to allow the app to track them using these identifiers. So, what does a failure to opt in to this tracking mean for the companies doing the tracking? It means a lot of the information they use to deliver, target, re-target and measure the effectiveness of ads will be unavailable to them. Unsurprisingly, this opt-in mechanism has many app providers up in arms.

Apple has long talked about privacy as a human right and has consistently made strides to provide more transparency and real choice to its users. This latest example provides more transparency and increases the awareness of consumers as to how their data is accessed and used. Additionally, an opt-in mechanism (as opposed to opt-out) forces the consumer to make a choice — meaning the common practice of setting the default to track consumers is no longer the case. This is best privacy practice and aligns closely with the privacy-by-default concept that exists in today’s stronger privacy laws. All of these things are good for consumers.

While the IDFA does not contain any personal information, it is device-specific. Every iPhone shipped has a unique IDFA and, unless a user actively changes it, the identifier will stay the same for the life of the device. Because of the long-term nature of this identifier, an IDFA is able to provide loads of information to advertisers collected from all the apps a user has downloaded without revealing personal information — it’s significantly more powerful than using cookies, which are browser-based and finite. Providing iPhone users the ability to control the use of these identifiers is a huge step forward for privacy. However, critics say it may also provide an opportunity for Apple to keep all that tracking for itself.

This was the root cause of an anti-trust lawsuit brought against Apple in France. The Interactive Advertising Bureau France and others claimed that because of Apple’s dominant position in the marketplace, its actions to hobble other companies’ ability to track consumers amounted to an antitrust violation. Their assertion was that Apple would significantly diminish others’ tracking abilities while continuing to track users with the powerful IDFA itself. The French Competition Authority did not grant the measures the IAB France et al were requesting but said it will continue to investigate whether Apple will be able to track users more than others can. Apple said in a statement that “The App Store terms and guidelines apply equally to all developers around the world, including Apple.”

The new ATT capabilities are now available to iPhone users, and opt-in rates are expected to be low. Apps that don’t have the capabilities to comply risk being kicked out of the app store.

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