Big tech companies – especially Facebook – are no longer viewed as consumer friendly due in no small way to privacy issues. Furthermore, Google, Amazon, and Facebook are viewed as predatory monopolists intent on using consumer information to earn billions in revenue rather than being champions of the consumer.
The controversy began largely in 2018 with data breaches of consumer information and quickly turned into a debate around these companies using personal information regarding attributes such as which apps a user interacts with, their location, and searches to sell targeted advertising.
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These big tech companies have consistently created new tools to allow consumers to control their data to stave off heavy regulation in the US and Europe. But in regulators’ minds, that may not be enough. Apple is increasingly becoming the defender of consumer data privacy. This spring, it will prevent iPhone tracking by default with a new update to iOS 14. This will empower users to opt in to tracking based on the identifier for advertisers, or IDFA. Naturally, this has drawn the ire of Facebook, which heavily relies on consumer data to deliver targeted advertising.
More legal battles for privacy may be ahead
App users are becoming increasingly aware that companies are gathering and using their data for advertising and artificial intelligence (AI). As such, it is likely that many will opt out of tracking, and companies that rely on targeted advertising will lose a major source of revenue. Facebook will not go down without a fight, and we could see the social media company and Apple embroiled in a legal battle. Overall, the skirmish highlights the power of big tech in general. Facebook has vast power over social media, but Apple has a vast amount of control over the devices it sells, controlling the OS, the App Store, and in-app features.
This is all in the absence of a US national privacy law and an overhaul to US laws that take monopolistic behavior of online companies into account. It’s unclear when federal lawmakers will move to pass legislation as they grapple with the Covid-19 pandemic. Still, a number of states are passing their own laws, which is likely to force companies to comply with those laws and apply them nationwide. At any rate, a number of changes are in store for big tech companies like Facebook and Snapchat that rely heavily on targeted advertising.
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