Mike Racic
Prebid.org / President
Beyond the Sandbox: How Digital Advertising Can Recoup Signal Loss in a Privacy-by-Default Internet
After many delays, Google has ultimately nixed its plan to phase-out third-party cookies. This would seem to significantly impact how our industry tackles addressability in a privacy-first internet. That’s certainly how the industry is responding to it— with some players breathing a sigh of relief, and others fortune-telling Google’s next move.
In reality, it underscores that privacy concerns are here to stay. Google’s investment in the Privacy Sandbox, or Apple’s App Tracking Transparency (ATT) for that matter, are a preview of what’s to come as signal loss continues – industry behemoths leveraging their data and identity solutions to their advantage at the expense of independent adtech.
Addressability continues to remain a critical challenge, and the open, free and fair internet can’t task Google or any other single company with providing all the answers — their responsibility is to their shareholders. It’s on independent adtech, both buyers and sellers, to find collective solutions and look out for our own interests and the interest of a free and fair internet.
Positioned at the intersection of advertisers, publishers, and adtech solutions, Prebid.org is uniquely prepared to address these challenges. Here are three key points to consider as we continue to solve for identity regardless of third-party cookie status and why the Prebid community is vital to mitigating signal loss.
1. The Cavalry Isn’t Coming
Counting on tech titans like Google or Apple to swoop in and define the future of privacy-forward addressability is short-sighted. While Google continues to develop privacy-preserving alternatives to third-party cookies through its Privacy Sandbox APIs, their innovations may fail to consider the challenges of independent ad tech, and as a private company, they will (rightfully) put their own business interest first. They are also not as vested in emerging spaces like DOOH, CTV, and other emerging cookie-free areas that privacy will still impact.
Similarly, Apple is reluctant to engage with the open web on solutions that work for publishers, brands and consumers. Their app opt-in privacy framework, ATT, which requires all iOS apps to ask users for permission to share their data, gives a signal to industry of what to expect – more privacy-forward measures, but a decline in shared signals for attribution.
It’s worth noting that when consumers are given the option to opt in or out of cookies, an overwhelming majority choose not to allow cookies—just as 96 percent of iOS users in the US block ad tracking on the iOS 14.5. This is a good reference point when considering user tracking opt-ins for device IDs.
Many players dread the idea of seeing a portion of their revenue disappear as signal loss continues. However, the way to prepare for the perfect storm that’s brewing due to regulation, consumer preferences and a squeeze from the walled gardens, is to be proactive with consumer protections while staying solution-oriented.
2. The Privacy Sandbox Should Accelerate Innovation – Not Slow it Down
As consumers gain more control over their data, the shift away from third-party cookies will only accelerate innovation.
In the immediate future, we hope to see major innovation around finding collective solutions that use consensually-given first-party data along with other signals to deliver relevant ads while preserving privacy.
Prebid’s SharedID is a good example for how this can work. It provides a proof point for how publisher controlled first-party data can be used to recoup signal loss. While far from perfect, it is the beginning of a working solution and one the industry can build on.
To navigate this transition away from third-party signals, the industry must invest in robust software and measurement. Breaking down silos across different environments is essential. What’s required is a multifaceted approach that integrates various strategies to ensure addressability while abiding by new regulations.
3. Pool Knowledge (and Value) within the Independent Adtech Community
Just as physicians avoid malpractice by knowing the latest legal changes, media businesses must stay vigilant regarding changing national and state data privacy legislation.
Compliance with these laws is not optional; it’s essential. Agility and proactive engagement with regional consent laws are key. As Google negotiates with regulatory bodies like the CMA and ICO, the future remains uncertain, and businesses can’t afford to passively stand by.
Here, independent adtech can learn from and educate each other with resources by pooling information. In a landscape where privacy laws are continually refined and amended, staying informed is not just a legal obligation but a strategic advantage. Those that adopt software and solutions with an eye on upcoming legislation have the best shot of future-proofing their businesses.
While Prebid.org can not guarantee regulatory compliance, we do support a thriving ecosystem that designs flexible solutions for regulatory compliance. These solutions can be modified to fit our diverse publisher bases needs.
In this shifting and unstable ecosystem, Prebid is more important than ever, because as a community, we can ensure that the infrastructure behind the marketplace relieves individual publishers of taking on the enormous challenge of navigating this alone.
What This All Means
For now, there’s no point in speculating about what Google’s next move will be. The negotiations between the CMA and Chrome teams are happening behind closed doors. Google and the Protected Audience API are only one piece of solving the broader challenges our industry faces.
What we do know is that PAAPI is not a fully developed product, nor sufficient to meet the needs of the marketplace.
This means that the free, independent and open internet must carve its own path forward – to the benefit of everyone. The pool of identifiable signals is shrinking. The decline of third-party cookies is inevitable. While we can’t solve for signal loss entirely, we can recoup some of it through open-source solutions.
The time to act is now. Prebid members, leverage our dedicated groups. If there ever was a time to engage with Prebid, this is it. Publishers, lean in and tell us what you need. Not a member? Get involved in other forums.
Ultimately, a “wait and see” approach is disastrous for the industry. Continued access to a free and open internet is at stake. Now is the time to lean in, get active, and shape your destiny—or it will be shaped for you without your input. Engagement is mission-critical to preserving an open web and fostering a new addressable marketplace, one defined by a privacy-first approach.