iOS 14 could affect Facebook’s ad business

Facebook appears to be gearing up for some new challenges it has to face as a result of iOS 14’s feature set. The company announced that the upcoming iOS update will require users to provide permission to apps to collect data. This change could affect Facebook’s advertising business – a core revenue source – drastically.

The social networking giant Facebook will not collect the identifier for advertisers (IFDA) for its apps on iOS 14. The company will reportedly reconsider this decision after it receives more guidance from Apple regarding these new changes. Facebook says it’s holding off on collecting IDFA as it believes it’s the right choice to provide “certainty and stability” to its partners.

Facebook also mentions in its blog that it will remind users that they can always check how their data is being used to improve ads and that they can also check “Off-Facebook Activity” feature.  Users will be able to completely disconnect the “Off-Facebook Activity” feature if they would like to.

To better support iOS 14, Facebook will reportedly release an updated version of the Facebook SDK. It will support Apple’s SKAdNetworkAPI which limits data provided to ad businesses and also affects measuring campaigns. However, Facebook will also ask businesses to create new ad accounts to better tackle this issue and to mitigate the impact of the new changes in iOS.

“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% drop in Audience Network publisher revenue when personalization was removed from mobile ad install campaigns,” says Facebook. “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.”

This announcement by Facebook did not affect its shares negatively.

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