Apple's Pro-Privacy Stance is Anti-Competition, German Regulator Says

 Apple's tracking crackdown wasn't only about protecting users—it was about beefing up its own business, German authorities say.

Photo: Justin Sullivan (Getty Images)

Another day, another antitrust investigation into a tech giant. This time, it’s Apple: Germany’s competition watchdog on Tuesday announced a new probe into Apple’s slate of anti-tracking tech that the company rolled out last year.

The Bundeskartellamt’s investigation is primarily focused on Apple’s App Tracking Transparency Framework (or ATT, for short). For those unfamiliar, ATT is the set of rules that Apple rolled out as part of iOS 14 that require third-party app developers to ask for permission to track the users that download their apps—and when those users say no, ATT is what shuts off these apps’ access to a slew of valuable user data. You might recognize it from the small window that pops up and asks you whether you want to give an app access to your personal information, and you can respond with “Ask app not to track” or “Allow.”

Bundeskartellamt President Andreas Mundt noted on Tuesday that “a corporation like Apple which is in a position to unilaterally set rules for its ecosystem, in particular for its App Store, should make pro-competitive rules.”

Apple loves to brand itself as the privacy protector that bravely stands up to countless other tech firms that slurp up your data and do... well, whatever they want with it. Case in point: An Apple spokesperson responded to the German investigation by saying, “Privacy has always been at the center of our products and features.” Naturally, those same companies were angry when ATT came into play. Perhaps the angriest was Facebook, which whined earlier this year that this single update would cost it an estimated $10 billion in targeted ad sales. Snapchat’s CEO, Evan Spiegel, recently chalked up a less-than stellar quarter for his own company to ATT as well. Stocks those two companies, along with Twitter and Pinterest, tanked in the aftermath of the update being rolled out.

iOS users have kept opting out in record numbers, tech firms have continued to sweat, and Apple’s continued running glossy TV campaigns about its privacy-preserving products. So what’s the issue?

Well, there are a few, according to the Bundeskartellamt’s complaint. For one thing, ATT doesn’t opt iOS owners out of Apple’s own tracking of their behavior across their device. At the same time, Apple’s been introducing its own pay-to-play ad products—like ads gracing the top of your App Store search results—that are micro-targeted with data that’s now unavailable to other advertisers. One analyst recently estimated that Apple’s ad business, which is already worth a hefty $2 billion, could grow 10-fold by 2025.

Taken together, some operators in the adtech space have called ATT a “blatant market grab.” The obvious need for user privacy might be a factor driving the move, they said, but ultimately, commercial factors—like growing its fledgling ads business—were the real motivators, they said.

Now, it’s looking like German regulators might agree. “We have reason to doubt that this is the case when we see that Apple’s rules apply to third parties, but not to Apple itself,” Mundt said.

This fresh scrutiny over ATT follows similar probes from competition authorities in France, Britain, and Poland over the same.

We’ve reached out to Apple for comment about the case. In a statement to Techcrunch, a company spokesperson had this to offer:

At Apple, we believe that a user’s data belongs to them and they should get to decide whether to share their data and with whom. We have long believed in the power of advertising to connect businesses with customers — and that you can have great advertising with great privacy. App Tracking Transparency (ATT) simply gives users the choice whether or not they want to allow apps to track them or share their information with data brokers. ATT does not prevent companies from advertising or restrict their use of the first-party data they obtain from users with their consent.

These rules apply equally to all developers — including Apple — and we have received strong support from regulators and privacy advocates for this feature. Apple holds itself to a higher privacy standard than almost any other company by providing users with an affirmative choice as to whether or not they would like personalized ads at all.

We will continue to engage constructively with the FCO to address any of their questions and discuss how our approach promotes competition and choice, while protecting users’ privacy and security.

Personalized or otherwise, it still seems like Apple is doing whatever it can to lure advertisers—and their dollars—away from the other tech giants. Given that these European competition authorities are concerned with precluding monopolies more so than shielding user data, there’s a chance that Apple’s pleas about privacy protection might be falling on deaf ears.