Apple is creating the new ‘Y2K’ incident that made Facebook wobble: Could $ 5 billion of profits be blown away in the second quarter of 2021 of the social network of billions of people?

Apple’s new privacy changes could shake the digital advertising industry and cause Facebook and other advertisers to adapt.

Apple’s controls expected to take effect this month will force app developers who need user permission to track, read personal information and permissions on the device. Advertiser ID number (IDFA).

These are random and secret numbers assigned to users and their devices. When a user opens an app or browses the web, the advertiser knows what he or she is viewing to post relevant ads.

The change Apple introduced is expected to reduce advertisers’ ability to study customer behavior to suggest relevant advertisements. “This is the equivalent of a Y2K incident in our industry,” said Doug Rozen, CEO of marketing firm Dentsu Media Americas. Our results go wrong “.

(Y2K is a computer problem that took place at the beginning of the year 2000. The reason is that older computers can’t tell the difference between 2000 and 1900 because they are programmed with two letters. The last issue of the year to save storage space Government, companies and organizations around the world had to urgently patch and change the system in 1999 to avoid a collapse when it entered 2000. ).

A major concern for advertisers is that Apple’s new policy limits Facebook campaign measurement and attribution. For Madan Bharadwaj – chief technology officer of a customer behavior research startup, this is no different “a huge blow to measurement”. Apple’s change will affect both a mobile eco-platform and those that use Facebook as the primary advertising method.

In a post last week, Facebook said it would stop using ad effectiveness studies. These studies calculate profitability and measure people’s shopping trends after viewing ads on the platform.

Some say they expect ads to go back to older methods like geolocation customer behavior research. An anonymous person said Facebook is running beta tests for such a tool.

“It’s not the most advanced approach, but we can automate and improve more under current conditions,” says Bharadwaj.

Mark Zuckerberg and Tim Cook.

For many others, a measurement becoming less detailed is not necessarily a bad thing. Andrew Richardson, the senior vice president of marketing science and analysis at Tinuiti, says the changes to IDFA will cause advertisers to access and use information from a variety of sources rather than just one platform. platforms like Facebook.

For its part, Facebook has begun informing advertisers of the impact of Apple’s new policy and guiding them to prepare for the upcoming changes.

Naturally, Apple’s change will affect Facebook’s business. According to mobile consultant Eric Seufert, the absence of an IDFA could blow away 7% of the company’s total profits – the equivalent of $ 5 billion for the company in the second quarter of 2021. Facebook has previously hatched a campaign to help small businesses personalize their ads on the platform.

Some brands say they are responding by being more creative in their first-party data collection. This week, Google said that it will no longer track users while browsing the web. This is the move to remove third party cookies used for advertising.

To date, the number of Apple users who declined to be tracked has not been determined. The consequences can be especially serious for advertisers who depend heavily on Facebook’s ecosystem. For example, dating app Bumble argues that Apple’s change could hamper its business.

“Facebook algorithm-based advertising brands are anxious,” Bharadwaj said. “They can’t throw half a million dollars for a campaign just to get in-depth data.”