All is not well in Silicon Valley at the moment, with two of the tech industry’s biggest companies pointing the proverbial finger at one another as end-users find themselves somewhere at the center of the crossfire. Apple and Facebook are at odds over controversial policies centered around user privacy and transparency.
Let us break some of it down for you.
Apple v. Facebook, Round 1: A new approach to internet advertising
Apple made waves at its latest Worldwide Developers Conference earlier this summer, announcing a major overhaul to its mobile operating system that many privacy experts painted as a big win for iOS users across the globe.
Placing a wealth of focus on user privacy, Apple will soon be equipping its users with new — but long overdue — benefits such as app privacy disclosures, tracking permissions, clipboard use alerts, approximate location tracking, as well as camera and microphone use notifications.
That may all sound a little vague at first glance, but trust us when we say that iOS 14 will be a major benefit to you and the tech community at large as the rest of Silicon Valley decides how it wants to respond to Apple’s unprecedented moves.
Some have responded with opposition. Not everybody is ready to call this a win. And if you happened to read the lede to this blog post, you’ll know that this half-hearted attempt at a cryptic transition is referring to Facebook.
Facebook argues that Apple’s new anti-tracking features will drastically impact companies that advertise on the popular social media platform.
Facebook states that many of its advertising partners use the platform’s Identifiers for Advertisers (IDFA) feature. This feature, in essence, allows companies to track you across different apps and websites. This is why you’re often inundated with loads of targeted ads for office chairs just after surfing the web for a more comfortable way to park your keister in your home office.
But iOS 14 will now require app developers to explicitly ask for your permission to track you across other websites and apps. This means you can — wait for it — actually say “no.” Wild, I know. But stay with us here. This could hurt businesses that benefit from targeted Facebook ads (except for Facebook itself because Facebook already knows everything about you).
“We expect these changes will disproportionately affect Audience Network given its heavy dependence on app advertising,” Facebook wrote in a company blog post. “Like all ad networks on iOS 14, advertiser ability to accurately target and measure their campaigns on Audience Network will be impacted, and as a result publishers should expect their ability to effectively monetize on Audience Network to decrease. Ultimately, despite our best efforts, Apple’s updates may render Audience Network so ineffective on iOS 14 that it may not make sense to offer it on iOS 14.”
Apple v. Facebook, Round 2: The Apple Tax Cut
It was only a few weeks ago that Facebook decided to roll out the latest feature belonging to its platform: event hosting as means for small business recovery, as stated by Head of Facebook App Fidji Simo.
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With many small businesses forced to close their doors as a result of the COVID-19 pandemic response, Facebook created a way for those businesses to create, promote, and host virtual events, such as trivia nights or fitness classes. Facebook would also allow those businesses to set a price and collect payments on the app as well.
Best, and most surprising, of all, Facebook also stated that this service would be free of charge for at least the next year.
Well, sort of.
While 100% of the fees for Facebook event transactions on the web and Android devices will go directly to the small business hosting the event, the same won’t be true for Apple transactions.
Much has been said about Apple’s App Store tax over the past few weeks, namely in the company’s battle with the world’s premier battle royale video game (more on that in a bit). The policy, catapulted into the realm of “controversial” this summer, mandates that Apple receive 30% of each transaction that takes place on any application that exists within its App Store.
““We asked Apple to reduce its 30% App Store tax or allow us to offer Facebook Pay so we could absorb all costs for businesses struggling during COVID-19. Unfortunately, they dismissed both our requests and SMBs will only be paid 70% of their hard-earned revenue.””
Taking a page out of the Apple handbook, Facebook decided to employ some strategic transparency, opting to actively inform its users of exactly whose pockets they were filling with this transaction.
The company shared an example of the sort of notification users should expect to receive when attempting to purchase access to a Facebook-hosted event.
Payment notification on iOS (left) and Android (right). (Image courtesy of Facebook, Inc.)
We’ll spare you from having to pull out your crayons to play “spot the differences” and just point them out for you:
Facebook wanted to explicitly state that “Apples takes 30% of this purchase” on Apple devices. It would also state that “Facebook doesn’t take a fee from this purchase” on any other device.
Apple blocked Facebook’s attempt at informing its users of the tax, labeling the notice as “irrelevant,” according to CNET.
“Now more than ever, we should have the option to help people understand where money they intend for small businesses actually goes,” Facebook said in a statement to Reuters. “Unfortunately Apple rejected our transparency notice around their 30% tax but we are still working to make that information available inside the app experience.”
Apple now finds itself fighting on two fronts over its tax policy, facing off against two of the most influential companies on the planet in 2020. News of this disagreement comes just weeks after Apple engaged in a dispute with Epic Games over its remarkably successful online video game, Fortnite — AKA the sole reason Summer 2019 was filled with little kids doing this dance on jumbotrons in sporting venues across the world:
With more than 350 million registered players, Fortnite took on the monumentally ambitious task of challenging Apple’s commission policies by adding a direct payment system within its app.
The result? As you might have expected: an outright ban from the App Store for Fortnite’s developers. The app is still available to those who’d already downloaded it to their devices, but any future updates will not be coming to any of those users until the disagreement is resolved either amicably or in a courtroom.
What do you make of all of Apple’s disagreements? Are you likely to buy the next iPhone (iPhone X2S Pro Max Elite Prime, if we had to guess) this fall if you can’t fully support your favorite small business or pick up a couple of, as the kids say, Victory Royales? Or are iOS 14’s new privacy and transparency features likely to keep you in the Apple ecosystem for the foreseeable future?
Feel free to comment below.