Regulators have been asking Google and other Big Tech companies for a long time to enhance privacy settings and to embrace privacy rules to protect consumers. However, when Google announced on Feb. 16 that it is planning to curtail cross-app tracking on Android Phones to develop more privacy-focused replacements, probably the same regulators were wondering now if this is what they were looking for.
Google’s decision to adopt new privacy restrictions to curtail tracking across apps on Android smartphones follows a similar decision adopted by Apple last year that aims at putting restraints on an advertising industry that collects vast amounts of data from billions of devices.
Google´s plans include replacing the alphanumeric identifiers associated with individual smartphones that apps use to gather and share information about users. One of the companies most affected by these changes is Meta, which relies on targeted advertising — this may reduce the amount and quality of data it collects.
The company is still negotiating with regulators about how to implement another privacy-enhancing tool that affect browsers, not apps on Android devices, which will entail phasing out third-party cookies (TPCs) and introducing a Privacy Sandbox. The extensive collection of data via cookies has given rise to concerns about users’ privacy and compliance with data protection laws. The stated aim of Google’s Privacy Sandbox Proposal is to remove cross-site tracking of Chrome users through TPCs and alternative tracking methods such as fingerprinting and replace it with tools to provide selected functionalities currently dependent on cross-site tracking.
When that plan was announced in 2020, it found strong opposition from third-party websites who complained that this would affect their businesses and it would reinforce Google´s market dominance. After an initial delay in its plans, Google may be finding a way to continue with it.
Just last week, Google and the U.K. Competition and Markets Authority came to an agreement to use the Privacy Sandbox in the U.K. Google had to submit some remedies — like providing transparency and consultation with third parties — before getting the approval. Additionally, the CMA will be closely involved in the development of the Privacy Sandbox proposals, and it could suggest changes if necessary to eliminate competition concerns.
The new plan to stop cross-app tracking may also be received by regulators and policymakers with skepticism. On the one hand, more privacy for consumers is exactly what they are asking for, including new regulations in Europe and in the US. Just this week, two bills have been introduced in California and at federal level to limit the amount of information Big Tech companies can collect from minors.
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But on the other hand, any changes that affect an online advertising business in which Google is dominant may simply reinforce its position, and regulators may be wary that the market will become less competitive. The European Commission is assessing a recent complaint about Google´s abuse of a dominant position in the AdTech business. The U.S. Department of Justice is also investigating Google’s practices in the online advertising markets. Thus, it is likely that regulators will look at this announcement with caution.
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But unlike other decisions by Big Tech that may raise red flags, Google´s plan to enhance privacy-settings will likely be welcomed by some regulators — and it may be difficult for antitrust authorities to prove any anticompetitive effects, easing the path for a smooth regulatory supervision.
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