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Sept. 3, 2020, 1:56 p.m.

Publishers are getting a (brief) reprieve from Apple’s coming ad-pocalypse

Apple now won’t kneecap the ad tech industry — for all the good and bad that implies — until early 2021. Publishers should use the extra time to get their data houses in order.

Let’s say someone came up to you — when you were reading the news, or playing a game — and handed you a form. “Hi! I’d like permission to track you. Not just here and now, but also going forward — across all sorts of places you go and things you do. Sound good?”

It seems unlikely that most people would say yes. But that sort of tracking, in digital form, lies at the heart of the online advertising industry. It’s just that, by and large, advertisers and developers haven’t been required to ask you whether you’re cool with it. They signed your name on your behalf.

Apple has announced plans to change that. And after much uproar, today the company announced it was hitting pause on those plans. Here’s Bloomberg’s Apple oracle, Mark Gurman:

Apple Inc. is delaying a change to its upcoming iOS 14 iPhone software that Facebook Inc. and other developers have warned would hurt their advertising businesses.

The move, announced in June, requires users to give explicit permission before letting apps track them for advertising purposes. This was due to be implemented this fall with the rollout of iOS 14. It is now being delayed until early next year, Apple said on Thursday.

“We want to give developers the time they need to make the necessary changes, and as a result, the requirement to use this tracking permission will go into effect early next year,” Apple said in a statement.

The company added that the feature will still be implemented when iOS 14 is released, but the delay means it won’t enforce the rule and require developers to adopt it. Apple said it will release more details on implementing the feature later this year.

At issue is a unique code that’s attached to every iPhone and iPad called its IDFA. At its June developers conference, Apple announced that iOS would soon start asking users to allow that sort of tracking — in every app and website whose adtech stack uses it. Few expect most iPhone users to agree happily. With this one move, Apple — whose software runs on roughly half of American phones — slices up the network of data that connects you to your online history. (That Apple is the largest tech company with essentially zero reliance on ad dollars gives it a strategy credit here.)

Facebook, for one, is not a fan of the move, but says the impact will be felt more by the game and app developers who use its ad network than by Facebook itself. (The sprawl of Facebook properties across your homescreen leaves it plenty of ways to track you within its walls.)

But publishers are bracing for an impact too. As the Journal’s Lukas I. Alpert and Patience Haggin put it:

Some publishers worry that most users will opt out, hobbling their ability to show personalized ads in apps and dealing them a blow at a time when the industry is trying to recover from the coronavirus pandemic. “When every publisher is fighting for every last advertising cent, this couldn’t come at a worse time,” said Martin Clarke, publisher of DMG Media, operator of the Daily Mail and MailOnline…

Sheri Bachstein, the global head of consumer business at the Weather Co., which operates weather.com, estimated that the price advertisers are willing to pay to advertise within iPhone apps could decline by as much as 40% as a result of the change. That is because advertisers generally pay a premium for ads targeted based on users’ interests and behavior on the web. Apple says it doesn’t plan to prohibit tracking, but will simply require app makers to obtain permission from their users to do so.

Apple’s new policy was set to go into force with the release of the next version of its mobile operating system, iOS 14, which is expected in the coming weeks. (iOS updated usually come out in September along a new batch of iPhones, but Covid-related factors will likely push that into October this year.) With today’s announcement of a delay, though, D-Day will now come in 2021.

Many news publishers will struggle to adapt; few have the sort of robust data systems that would allow them to create something like the ad targeting Apple would be limiting. Publishers who sell most of their own advertising directly will have an edge over those who rely on programmatic ad networks. In the long run, that’s probably a healthy tradeoff for publishers — but there’ll be pain in the meantime.

One likely winner: The New York Times, which decided months ago to phase out all third-party ad tools in favor of its own inhouse data stack. The Times will let advertisers target 45 or more audience segments, defined by its own data. That’s great for the Times and other big dogs, like The Washington Post and Vox Media, who have the tech capacity to pull this off. But it’ll be harder for smaller fry.

One impact I’d expect to see from this: more news sites tightening their registration walls, requiring drive-by readers to create and log into an account to see even a single news story. The Times and McClatchy, among others, have moved in this direction in the past year; it’s awfully hard to gather good targeting data as a publisher without having your readers logged in and identified. (Sorry, incognito-window fans: Your paywall-evading days may be numbered.)

POSTED     Sept. 3, 2020, 1:56 p.m.
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