Apple On Data Collection: 'Why Would You Do That?'

AppleWWDC15Apple's stance on data collection: “We honestly just don’t want to know,” said Craig Federighi, Apple’s SVP of software engineering, to roughly 5,000 app developers at the tech giant's Worldwide Developer Conference on Monday.

“We don’t mine your email, your photos or your contacts in the cloud to learn things,” Federighi said. “All of this is done on device and it stays on device under your control. And if we do have to perform a lookup on your behalf – for instance, for current traffic conditions, it’s anonymous, it’s not associated with your Apple ID, it’s not linked to other Apple services and it’s not shared with third parties. Why would you do that?”

The word “control” is particularly salient considering the results of a recent survey conducted by the University of Pennsylvania in which more than half of respondents said they felt that it was not okay for companies to create shopper profiles about them, even if that practice ultimately helps improve the service they receive.

Apple CEO Tim Cook himself made some particularly spicy remarks recently around data collection at a dinner hosted by the Electronic Privacy Information Center where Cook was honored as a “champion of freedom.”

“You might like these so-called free services,” Cook said, in a thinly cloaked reference to Google. “But we don’t think they’re worth having your email or your search history or now even your family photos data-mined and sold off for god knows what advertising purpose.”

Privacy was mentioned several times during the WWDC kickoff keynote – but advertising? Not so much. That doesn’t mean, however, that Apple isn’t thinking deeply about its devs, said Craig Palli, chief strategy officer at Fiksu.

“Apple’s done great things for them, including creating an extremely powerful tool in the advertising identifier or IDFA,” Palli said. “In combination with what data developers can collect through their own apps and what’s possible through major ad channels like Facebook and RTB, the IDFA gives advertisers plenty of capabilities to segment and target users.”

David McIninch, VP of marketing at Acquisio, sees Apple’s stringent stance as less about the app developer community and more about “making Google’s life difficult.”

“The inability to get as robust a data set about a specific user makes attribution and audience targeting more difficult, but doesn’t fundamentally change the importance of mobile to an advertiser to anyone else in the ecosystem,” McIninch said. “Apple’s focus on privacy is really about setting up their proprietary and Apple-native tools [such as] spotlight search and ‘proactive’ Siri voice assistant, as an alternative to Google search. Apple doesn’t need to monetize data and sell it to advertisers, so its native search capabilities don’t need to scoop massive amounts of user data to perform.”

That said, Apple is only one monolith in an ecosystem of monoliths.

“In-app data collection will still occur and huge mobile publisher platforms, for example, Facebook, will still be monetizing your data on behalf of advertisers, in part as a consequence of the privacy trade-off their users clearly agree to," McIninch said.

But, as the Penn study demonstrated, most users feel helpless when it comes to managing their personal data. As the study noted, “A majority of Americans are resigned to giving up their data – and that is why many appear to be engaged in trade-offs.”

Although the app ecosystem is “highly dependent on ads,” there is “a fine line between violating someone’s privacy and using information to generate a more relevant ad that has context,” said Pedro Jahara, CEO of RevMob.

“Most apps in the App Store incorporate ads [and] the more ad networks are able to provide relevant ads to users, the better developers can monetize their apps, as well as improve the user experience since ads will be targeted to their interests,” Jahara said. “[But] a user should be able to choose to share some information to have a better app experience.”

Cook and crowd may have what seem to be fighting words for Google, et al., but David Bozin, VP of business development at Bindo Labs, sees Apple’s privacy posture as better for everyone in the long run, including developers.

“It’s all about the users – so long as users feel comfortable using the platform and it continues to grow and remain the leader, then that means more users,” he said. “More users to download apps. More users to pay for upgrades or subscriptions. More users to listen to ads.”

And it’s not as if the entire app ecosystem is purely dependent on advertising, said Bozin, noting that some apps make money off of pay-once or SaaS models.

Apple’s attitude aside, developers do appear to be making bank on iOS. The App Store recently passed 100 billion apps downloaded and Cook announced Monday that Apple has paid out around $30 billion to developers since 2008.

But Branch Metrics CEO Alex Austin can't help but remain cynical, calling Apple's position a "permanent hamstring to anything they do in the developer services space.”

“Developers depend on user monitoring to figure out how to improve their products and grow a real business,” Austin said. “Early usage of the new Apple developer analytics shows that it's basically useless because the user has to opt in to analytics. Developers are reporting less than 15% of users actually opt in share their data with the developer. It's laughable.”

Although advertising didn’t get any airtime during the WWDC kickoff, Apple did make announcements around a new native news app – putting Facebook’s Instant Articles on notice – and a streaming Spotify-like service to be called Apple Music. Apple said it won't collect or share user reading habits within the news app.

It’s all about making Apple sticky. App developers can benefit from that stickiness, Fiksu’s Palli said.

“Developers have created a huge business around apps … and continue to monetize through advertising in huge numbers,” said Palli. “What’s more, these new tools will likely lead to even more use of mobile devices, which in turn will create more ad impressions and monetization opportunities.”

1 Comment

  1. Adman

    This will continue to bifurcate the mobile market as the wealthy, the educated, the intelligent will continue to flock to Apple leaving the hordes of less than desirable demographics to the other guys...

    Great news for Google if you're marketing paycheck lending, Nascar tee-shirts, sugar soda and fast food. Not such great news if you want to attract high quality brands and products...

    Reply

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