Apple's privacy-focused iOS 14 update could decimate large chunk of Facebook's advertising business

Apple’s new iOS 14 update is set to deal a major blow to Facebook and other apps that users’ data across apps. According to Facebook, the update significantly hampers Facebook’s ability to provide targeted ads to iPhone users, which could, in turn, have a devastating effect on the social media giant’s business.

In a blog post, Facebook said that Audience Network, the platform that lets advertisers target audiences when they are using non-Facebook apps, will be the area that will be significantly affected due to these changes. This may severely impact publishers’ ability to monetize through Audience Network on iOS 14 and could render the Audience Network so ineffective on iOS 14 that it may make sense to not offer it on iOS 14.

The post read, “ While it’s difficult to quantify the impact to publishers and developers at this point with so many unknowns, in testing we’ve seen more than a 50 percent drop in Audience Network publisher revenue when personalization was removed from mobile app ad install campaigns. In reality, the impact to Audience Network on iOS 14 may be much more, so we are working on short-and long-term strategies to support publishers through these changes.”

Audience Network is a major component of Facebook’s revenue from advertising. However, its targeting ads have been a subject of controversy. Apple, on the other hand, has continued to reiterate its commitment to protecting its users’ data and privacy.

Facebook’s blog post continued to stress the impact the changes would have on small businesses; “We understand that iOS 14 will hurt many of our developers and publishers at an already difficult time for businesses. We work with more than 19,000 developers and publishers from around the globe, and in 2019 we paid out billions of dollars. Many of these are small businesses that depend on ads to support their livelihood.”

Apple announced iOS 14 in June this year, and the update is expected to roll out to Apple devices in the coming months. iOS 14 is currently already available for public beta testing.

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