The latest privacy changes from Apple and Google have prompted Facebook to work toward minimizing the company’s targeted ad business from collecting your personal data.
On Wednesday, Facebook announced a “multi-year effort” to create next-generation online ads that can still target people based on their interests, but preserve some user anonymity.
Over the years, Facebook has gained a reputation for tracking users’ internet activity to help businesses serve relevant ads to consumers. At times, the practice has exposed people’s personal details to third-party companies.
Facebook now says its ad business must change with the times. “With Apple and Google continuing to make changes via their browsers and operating systems, and with the changing privacy regulatory landscape, it’s important to acknowledge that digital advertising must evolve to become less reliant on individual third-party data,” wrote Facebook VP for Product Marketing Graham Mudd in a blog post.
Earlier this year, Apple added new privacy safeguards in iOS 14 that hampered Facebook’s ability to serve targeted ads to many iPhone users. Google, on the other hand, is working to phase out third-party cookies from the Chrome browser starting in 2023, in another move that could stymie the data flow powering targeted advertising.
As a result, the changes threaten to upend Facebook’s business, which pulled in over $80 billion in revenue last year on advertising. However, Mudd says the social network can still keep its ad machine running; it just needs to bake privacy safeguards into the processes.
“We are optimistic that new privacy-enhancing technologies will prove that personalization remains possible and effective as our industry evolves to become less reliant on individual third-party data,” he wrote. “These technologies will help us minimize the amount of personal information we process, while still allowing us to show people relevant ads and measure ad effectiveness for advertisers.”
How Will This Work?
The so-called privacy-enhancing technologies (PETs) promise to better strip away your personal details and identity when businesses use Facebook to serve ads to relevant users. One technique is called Secure Multi-Party Computation, and it involves processing a user’s internet history with other users in an aggregate form. But perhaps more importantly, it can prevent Facebook from creating a giant database revealing more about a user’s activities across the internet.
“With MPC, say one party has the information about who saw an ad and another party has information on who makes a purchase. MPC and encryption make it possible for both parties to learn insights about how an ad is performing, without the need to entrust a single party with both data sets,” Facebook said.
Another technique involves on-device processing over a smartphone or PC to personalize the ad experience. “On-device learning trains an algorithm from insights processed right on your device without sending individual data such as an item purchased or your email address to a remote server or cloud,” Facebook said. “This technology could help us find new ways to show people relevant ads, without needing to ever learn about specific actions individuals take on other apps and websites.”
A third method involves adding “noise” or random bits of information during the data processing to preserve privacy. “For example, if 118 people bought a product after clicking on an ad, a differentially private system would add or subtract a random amount from that number. So instead of 118, someone using that system would see a number like 120 or 114,” the social network said.
But to make the technologies a reality, Facebook says it needs support from the entire internet ecosystem. “That’s why we are calling on platforms, publishers, developers and other industry participants to work together—on these technologies and other privacy-focused standards and practices,” Mudd added.
In the coming months, Facebook plans on gathering input from industry stakeholders on the next-generation ads. It’ll then share more details with the public as the technologies progress.
