The Year Ahead in Privacy and Your Data

The Year Ahead in Privacy and Your Data

In 2023, a few changes will make it little harder for third-parties to spy on you across the web. As a result, the companies who still have access to consumer information are going to get a lot more greedy with it.

First of all, Google is finally rolling out its Privacy Sandbox project. That will eventually kill third-party cookies once and for all, and Google will replace them with tools that use your own device to monitor your online activity. Advertisers will have to go through Google if they want harness that information.

Apple is likely to come up with something similar. The company’s flawed but powerful App Tracking Transparency setting already makes iPhone apps ask permission before they spy on you. That’s cut off the flow of Apple user data, and the advertising industry is hungry for a solution. Apple will make a lot of money if it delivers one.

Apple and Google will celebrate these moves as a privacy victory, but the truth is more complicated. Companies that have a lot of information about their own customers are now sitting on a gold mine. Almost every big consumer-facing company has launched its own advertising network — Disney, Kroger, Marriott, Uber, you name it. Smaller companies are, in many respects, out of luck.

The government is working to limit the spread of your information, too. Regulating big tech is one of America’s only bipartisan issues. More states are passing privacy laws, and federal privacy rules maybe on the horizon.

But don’t think that means companies will stop spying on you. They’re just going to be more competitive about it, and they’ll be sharing less of your information with each other. If your main concern is personal data falling into the wrong hands, that’s a good thing. But this new era in privacy is going to cement power in the hands of a limited number of big businesses.

What we’re waiting for:

  • A federal privacy law. Congress doesn’t have an amazing track record when it comes to actually doing stuff, so don’t hold your breath. But in 2022, law makers got closer than ever. Everyone is in favour of passing some kind of privacy law; even tech companies like Meta and Google want federal data rules because they’re afraid of the regulatory nightmare of a patchwork of state laws.
  • A showdown in Europe. After years of relatively lax enforcement, EU regulators are starting to bring the hammer down on the tech industry. A recent ruling against Meta could place severe limits on targeted advertising, and the upcoming Digital Markets Act may force companies to end certain practices that harm competitors. That could change the face of digital privacy if Apple and Google are forced to open up their walled gardens.
  • New, innovative ways to spy on you. Data hungry companies aren’t just going to give up on tracking users. One method is to dial back the specificity: Companies can collect a few limited pieces of demographic data to sort you into a category of like-minded people, and use machine learning to make predictions about your interests. Is that better for your privacy? Sort of, until you realise that those kinds of systems are scarily accurate. Companies may not need much of your data to violate your privacy.

Unconventional wisdom:

More privacy restrictions is going to mean you see a lot more ads. It’s a little counterintuitive. But as third-party data becomes less accessible and the number of competing ad networks grows, serving ads becomes less profitable. What do you do if individual ads make less money? You just show more of them. A looming economic recession will only increase the pressure to show more ads to drive up revenue.

Websites and apps will get more cluttered. You’ll have to sit through more pre-roll ads before a video plays. Social media platforms will show you ads more frequently in your feeds. And companies are going to stick ads in places you haven’t seen them before.

People to follow:

  • Senator Maria Cantwell — The Senator from Washington is the current chair of the Senate Commerce Committee. If a federal privacy bill gets considered in 2023, Cantwell will be a major player.
  • Senator Ron Wyden — Senator Wyden is perhaps the most thoughtful American politician when it comes to tech policy. He’s a good follow because whatever his position is on privacy issues, that will probably be the most radical US regulation can get.
  • Lina Kahn — As chair of the FTC, Khan is going after the tech industry like the commission never has before. She’s already launched a number of investigations and major enforcement actions, and there are certainly more on the horizon.
  • Eric Seufert — Seufert is a marketing consultant and author of the blog Mobile Dev Memo. It’s wonky, but it’s a must read for anyone who wants to understand ad tech. He’s a leading commentator on digital advertising, and one of the most influential thinkers in the ad business.

Companies to watch:

  • Meta — The company is working to salvage an advertising business kneecapped by Apple as it builds out Mark Zuckerberg’s vision of a virtual world. The next year may tell us everything we need to know about whether Meta will stay relevant or seed its dominance to other players.
  • TikTok — When you hear about TikTok privacy issues, it’s usually in the context of national security. But everyone’s favourite short form video app is hard at work building an advertising empire on top of your data.
  • Google — Google’s Privacy Sandbox will throw digital advertising into a tailspin. The web is undergoing a massive shift, and it will be interesting to watch how the search giant positions itself in the new era of the internet.
  • Apple — Apple brands itself as the privacy company. But it also has a slightly different definition of the word “privacy” than most people. Specifically, the company want you to think it means protecting your data from everyone but Apple. Apple’s privacy efforts already shaped the data business, and any steps they take in the direction of more digital advertising will have a massive impact.

A long shot bet:

In 2023 Apple will become a major player in the advertising business. The company locked down its customers data — although Apple tracks you all over the place, even when it seems like they’ve promised not to. It seems pretty clear that Apple’s privacy moves are also part of a long game to edge out advertising competitors like Meta.

Right now Apple doesn’t offer a lot of advertising options, but they’re quietly setting up new places to target you with ads. But the places where you can buy an ad with Apple will grow significantly. The company will stick ads in other parts of its ecosystem, no doubt about it. But I think Apple is going to launch an advertising network that shows ads across other companies’ apps and websites, too, just like the systems Google and Meta run. Apple will say they’ve come up with a way to do it that doesn’t violate anyone’s privacy. But these ads will run on data collection, just like the systems Apple has spent years criticising.