Google’s Latest Privacy Play Has Big Implications for the Open Web

Google’s recent announcement that it would stop selling ads based on users’ specific web browsing histories was met with enthusiasm among consumer privacy experts. Within the local marketing and advertising community, the reaction was different.

Local marketers, advertisers, and location tech veterans have a very different outlook on how the move will impact the emerging digital identity ecosystem and the development of the next iteration of the programmatic market.

Google’s plan to stop using or investing in tracking technologies that uniquely identify web users as they move from website to website has the potential to move the digital advertising industry as a whole away from individualized tracking. It shouldn’t be a surprise, given that the company had already announced that its Chrome browser would phase out support for third-party cookies by 2022. This latest announcement makes it explicit that Google does not plan to build alternate identifiers to track individuals online, even once third-party cookies are completely phased out.

The recent passage of Virginia’s new privacy regulation, coupled with California’s Privacy Rights Act and the European Union’s General Data Protection Regulation, has put privacy in the spotlight once again. The issue of consumer privacy is seen as central to the future of local media and commerce. Companies like Foursquare and PlaceIQ have had to innovate around new restrictions, even as those restrictions continue to evolve.

Google’s new announcement is different, though. Given Google’s size, the company has incredible influence on the digital advertising industry. Google alone accounted for 52% of global digital ad spending in 2020, according to the digital ad consultancy Jounce Media. The company’s decision to stop selling ads based on users’ web browsing histories will have a major impact on any vendor that relies on tracking to target ads, measure ad effectiveness, and prevent online fraud.

“Google has essentially said that their ad platform and business is going to move away from the open web. The company’s plans to stop targeting ads based on browsing history will create an even deeper chasm between advertising campaigns on this particular ‘walled garden’ and the rest of the open web, and surface an even deeper need across the ecosystem for ways to merge the two,” explains Tom Richards, global product director at MiQ, a programmatic media partner for major brands like Audi, PayPal, and Samsung. “In other words, while Google is executing on their own plan, the open web will still embrace authenticated solutions.”

Although Google’s moves don’t affect mobile at the moment, Richards says Android is likely to go the same way as iOS, which has become more anti-tracking under Apple’s stewardship.

The consensus seems to be that Google is taking action on privacy to get ahead of privacy regulations and consumer pushback. More cynically, one could say the firm is cutting off access to tracking for smaller players while it retains its own massive store of data on consumers.

“Google wants to draw what may appear to be a clear line in the sand for both regulators and consumers to let them know that they’re privacy-minded,” Richards says.

Richards says the decision points to increasing fragmentation within the digital advertising industry. Selling consumers on data collection is becoming more important as data dries up and competition gets tougher.

“Making clear the value exchange to consumers will become increasingly important,” Richards says. “If the rest of the adtech ecosystem can enable that consumer opt-in, there will be a huge opportunity that comes along with that.”

Stephanie Miles is a senior editor at Street Fight.