Facebook blasts Apple in new ads over iPhone privacy change

Facebook on Wednesday ran newspaper ads, published a new website and ran blog posts outlining its arguments opposing Apple over a privacy change that it claims "threatens the personalized ads that millions of small businesses rely on to find and reach customers." 

Facebook, in its blog post, argued that Apple's new tracking rules are "about profit, not privacy," and said it believes Apple is behaving anticompetitively by using control of the App Store in a way that benefits its bottom line at the expense of developers and small businesses.

The company is running print and digital ads in The Wall Street Journal, New York Times and Washington Post that say: "We're standing up to Apple for small businesses everywhere." It also has a new website on an upcoming change to iOS 14 that affects how apps can use ad-tracking tools with Apple's ad identifier, the IDFA.

"Without personalized ads, Facebook data shows that the average small business advertiser stands to see a cut of over 60% in their sales for every dollar they spend," Facebook's print ad reads. "While limiting how personalized ads can be used does impact larger companies like us, these changes will be devastating to small businesses, adding to the many challenges they face right now."

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The ad leads readers to a link for a website on Facebook for Business, which includes videos of interviews from business owners speaking out against the ad change. It also includes explanations of what will happen, and a "toolkit" to make posts with the hashtag "#SpeakUpForSmall" to talk about the change. 

Apple will soon be making a huge change to settings on users' iPhones in the name of privacy, and it will fundamentally change mobile advertising on those devices. It will take a privacy option that was previously buried deep in users' phones and put it front and center when they open an app, which is expected to dramatically impact the ability of advertisers to target ads the way they have been since people likely won't opt in.

Facebook has been outspoken about the change since it was announced in June, accusing Apple of moving the free, ad-supported internet into paid apps and services, where Apple can take its 30% cut, and crush small businesses' ability to do personalized advertising.

In its blog post, Facebook also made the consumer-facing argument that apps and websites that were once free may start charging people for services or be forced out of business because they can no longer offer free products supported by advertising. 

"Paying for content may be fine for the well off, but many people just don't have room in their budget for these fees," the blog post, written by Facebook VP of ads and Business Products Dan Levy, says.

Facebook reassured investors that it will not be severely impacted by Apple's change to iOS.

"We will be fine," said Levy on a call with reporters Wednesday. He said the company has already been factoring this into its expectations for Facebook's overall business, which he called "large and diverse." But he said the impact will be greater on creators and small businesses.

Facebook also argued that Apple isn't "playing by their own rules," and said the company isn't subject to its own iOS 14 policies. An Apple spokesman disagreed, telling CNBC its own apps and services have to comply with its tracking rules and that its own ad network, called SKAdNetwork, is free for developers and Apple doesn't make any money off it.

The Apple spokesman declined to comment on Facebook's push against the iOS 14 ad targeting change.

In its blog post, Facebook also said it would provide information in the Epic Games litigation. Fortnite maker Epic Games is embroiled in a legal battle with Apple over the company's 30% fee and related practices.

Steve Satterfield, a director of privacy and public policy at Facebook, said the company supported Epic and was prepared to provide relevant information about how Apple's policies are hurting "the millions of people and businesses who use our services."

Also Wednesday, Facebook accused Apple of using its power to "harm developers and consumers" as it welcomed draft laws outlined by the European Commission, the executive arm of the EU. The laws introduce rules for platforms that act as "gatekeepers" in the digital sector, while the Digital Services Act is designed to address illegal and harmful content by asking platforms to quickly take it down.

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