Apple vs. Meta: Swords Drawn in the Privacy Arena
Venore Worldwide
Remember the days when every ad seemed to follow us around the internet? We’d gotten so accustomed to seeing an item we viewed on Instagram suddenly appear on Facebook that we even started theorizing our phones were “listening” to us. That is, until Apple’s major move in 2021 changed everything.
Apple’s so-called “privacy bomb,” the App Tracking Transparency (ATT) feature, shook the digital advertising world to its core. It was especially jarring for Meta—resulting in a revenue loss of a whopping 10 billion dollars. But why was Meta hit so hard when giants like Google managed to stay standing?
The secret lies in each company’s business model. Apple’s position is quite comfortable: most of its revenue comes from hardware sales—iPhones, iPads, Macs—yielding high profit margins. For Apple, advertising is merely a small side business. With its ad revenues expected to reach 10 billion dollars in 2024 (out of a total 420 billion), they remain a drop in the bucket by comparison. This security allows Apple to keep its users within its own “walled garden” and limit data-sharing with other platforms. What’s more, it bolsters Apple’s image as a premium brand that prioritizes privacy.
For Meta, the situation is far more complex. Its lifeblood depends on cross-platform user tracking. Seeing an ad on Facebook for something you discussed over WhatsApp was once routine, but not anymore. Meta’s ad revenues fell from 115 billion in 2021 to 113 billion in 2022, and only through new strategies has it projected a rebound to 130 billion in 2024.
While Apple’s privacy move (ATT) rattled Meta, Google barely felt the storm. Why? Because Google’s advertising model largely relies on first-party data gathered within its own ecosystem, and Search ads, which target users based on their immediate queries, don’t require extensive cross-app tracking. In fact, Google’s ad revenues, which stood at around 147 billion dollars in 2020, are estimated to reach between 250 and 270 billion by 2024. Thanks to services like YouTube, Gmail, and Google Maps—tightly integrated with Google accounts—iOS tracking restrictions have had only limited impact. Also, Google’s deal to remain the default search engine on Apple devices ensures that most iPhone search traffic stays with Google. Naturally, the EU’s Digital Markets Act (DMA) and AI-driven innovations like Bard could eventually challenge Google’s comfortable lead, but for now, it’s taking a more moderate approach than Meta by signaling “gradual compliance” to avoid direct conflict with the EU.
However, the wind is starting to shift. The DMA regulations in the EU have opened an unexpected window of opportunity for Meta. Set to take effect in March 2024, these measures aim to tear down the walls of Apple’s famously closed garden. For instance, forcing iMessage to interoperate with WhatsApp could introduce the first cracks in Apple’s privacy armor.
Meta has no intention of missing this chance. Zuckerberg accuses Apple of using privacy as a card to stifle competition. Apple, for its part, argues that these integrations pose security risks while quietly expanding its own advertising business. Ads in the App Store, sponsored content in Apple News, even suggestions in iOS’s “Today” tab—Apple’s advertising real estate continues to grow. Its ad revenue was only 2 billion dollars in 2020 but is on track to reach 10 billion in 2024. And it’s tapping into user data for these ads—provided that data stays “in Apple’s garden,” of course. Meta’s CEO Mark Zuckerberg calls it pure “hypocrisy.” While Apple restricts rivals’ ability to collect user data, it’s simultaneously growing its own ad empire. Perhaps Tim Cook’s mantra—“privacy is a human right”—needs a slight edit: “as long as you stay inside Apple’s walled garden.”
The coming months appear set to host one of the biggest privacy battles the tech world has ever seen. With the EU’s six-month compliance deadline looming, Meta is preparing to strike back, while Apple stands ready to defend its strongholds. We don’t yet know who will come out on top, but one thing is clear: as the balance of power in the digital landscape is reshuffled, the future of user privacy will be shaped right at the center of this conflict. Moreover, the rapid growth of AI could completely redefine the advertising pie within that “privacy box,” creating brand-new opportunities—and making the months ahead more exciting than ever.
Apple’s so-called “privacy bomb,” the App Tracking Transparency (ATT) feature, shook the digital advertising world to its core. It was especially jarring for Meta—resulting in a revenue loss of a whopping 10 billion dollars. But why was Meta hit so hard when giants like Google managed to stay standing?
The secret lies in each company’s business model. Apple’s position is quite comfortable: most of its revenue comes from hardware sales—iPhones, iPads, Macs—yielding high profit margins. For Apple, advertising is merely a small side business. With its ad revenues expected to reach 10 billion dollars in 2024 (out of a total 420 billion), they remain a drop in the bucket by comparison. This security allows Apple to keep its users within its own “walled garden” and limit data-sharing with other platforms. What’s more, it bolsters Apple’s image as a premium brand that prioritizes privacy.
For Meta, the situation is far more complex. Its lifeblood depends on cross-platform user tracking. Seeing an ad on Facebook for something you discussed over WhatsApp was once routine, but not anymore. Meta’s ad revenues fell from 115 billion in 2021 to 113 billion in 2022, and only through new strategies has it projected a rebound to 130 billion in 2024.
While Apple’s privacy move (ATT) rattled Meta, Google barely felt the storm. Why? Because Google’s advertising model largely relies on first-party data gathered within its own ecosystem, and Search ads, which target users based on their immediate queries, don’t require extensive cross-app tracking. In fact, Google’s ad revenues, which stood at around 147 billion dollars in 2020, are estimated to reach between 250 and 270 billion by 2024. Thanks to services like YouTube, Gmail, and Google Maps—tightly integrated with Google accounts—iOS tracking restrictions have had only limited impact. Also, Google’s deal to remain the default search engine on Apple devices ensures that most iPhone search traffic stays with Google. Naturally, the EU’s Digital Markets Act (DMA) and AI-driven innovations like Bard could eventually challenge Google’s comfortable lead, but for now, it’s taking a more moderate approach than Meta by signaling “gradual compliance” to avoid direct conflict with the EU.
However, the wind is starting to shift. The DMA regulations in the EU have opened an unexpected window of opportunity for Meta. Set to take effect in March 2024, these measures aim to tear down the walls of Apple’s famously closed garden. For instance, forcing iMessage to interoperate with WhatsApp could introduce the first cracks in Apple’s privacy armor.
Meta has no intention of missing this chance. Zuckerberg accuses Apple of using privacy as a card to stifle competition. Apple, for its part, argues that these integrations pose security risks while quietly expanding its own advertising business. Ads in the App Store, sponsored content in Apple News, even suggestions in iOS’s “Today” tab—Apple’s advertising real estate continues to grow. Its ad revenue was only 2 billion dollars in 2020 but is on track to reach 10 billion in 2024. And it’s tapping into user data for these ads—provided that data stays “in Apple’s garden,” of course. Meta’s CEO Mark Zuckerberg calls it pure “hypocrisy.” While Apple restricts rivals’ ability to collect user data, it’s simultaneously growing its own ad empire. Perhaps Tim Cook’s mantra—“privacy is a human right”—needs a slight edit: “as long as you stay inside Apple’s walled garden.”
The coming months appear set to host one of the biggest privacy battles the tech world has ever seen. With the EU’s six-month compliance deadline looming, Meta is preparing to strike back, while Apple stands ready to defend its strongholds. We don’t yet know who will come out on top, but one thing is clear: as the balance of power in the digital landscape is reshuffled, the future of user privacy will be shaped right at the center of this conflict. Moreover, the rapid growth of AI could completely redefine the advertising pie within that “privacy box,” creating brand-new opportunities—and making the months ahead more exciting than ever.
