Facebook Complains that Apple's Privacy Changes Are Hurting Business

Tech giant Facebook has claimed that Apple’s new privacy terms are likely to cause further issues for the company’s ad business in the third quarter.

Axios reports that Facebook said in a blog post this week that Apple’s new privacy terms are going to continue to cause issues for the company’s advertising business in the third quarter. It would appear that the trends Facebook is seeing in the current quarter reinforce previous worries about the impact of Apple’s iOS 15 privacy updates.

Facebook’s VP of Product Marketing Graham Mudd stated in a blog post: “As we noted during our earnings call in July, we expected increased headwinds from platform changes, notably the recent iOS updates, to have a greater impact in the third quarter compared to the second quarter.”

MENLO PARK, CA – APRIL 04: Facebook CEO Mark Zuckerberg speaks during an event at Facebook headquarters on April 4, 2013 in Menlo Park, California. Zuckerberg announced a new product for Android called Facebook Home. (Photo by Justin Sullivan/Getty Images)

Tim Cook CEO of Apple laughing ( Stephanie Keith/Getty)

In August, Facebook did not appear as worried about the ad change as it is now. AP News reported at the time:

Apple will soon require apps to ask users for permission to collect data on what devices they are using and to let ads follow them around on the internet. The social network said Wednesday that those rules could reduce what apps can earn by advertising through Facebook’s audience network.

Facebook said it expects “less impact” on its own advertising revenue than on the ad-supported businesses that rely on its audience network to promote their apps. The audience network allows Facebook and Instagram advertisers to place their ads elsewhere on the internet.

Facebook has claimed in recent months that Apple’s changes to iOS are not about protecting user privacy but rather an attempt to assert market dominance. Facebook also recently revealed that it had been accidentally under-reporting web conversions including sales and app installs, leading advertisers to believe that their ads were ineffective.

Facebook stated that as a result of the under-reporting the measurement of advertising performance was 15 percent worse on average than it would have been. Mudd wrote in the blog post:

We’ve heard from many of you that the impact on your advertising investment has been greater than you expected. The cost of achieving your business outcome may have increased and it’s also gotten harder to measure your campaigns on our platform. In some cases, this is due to underreporting on our part.

Our estimate is that in aggregate we are underreporting iOS web conversions by approximately 15%; however there is a broad range for individual advertisers. We believe that real world conversions, like sales and app installs, are higher than what is being reported for many advertisers. We are committed to helping you better measure these outcomes and improve your performance.