Google’s plan to end support for third-party cookies in its Chrome browser has been postponed for nearly two years, after the idea had an impact on one of the foundations of today’s online advertising industry.
The search engine said it is postponing discussions with regulators and companies involved in digital advertising and “to avoid jeopardizing the business models of many online publishers that support free content.”
The digital advertising industry has a respite, and the industry faces uncertainty as one of its main ways of locating online messages is coming to an end. Trade Desk stock, this American company has been trying to win support another way Targeted advertising rose 17% due to news, while French advertising technology company Criteo rose 11%. Truist analyst Youssef Squali said the delay will give the online advertising industry longer time to perfect the cookie alternative.
A third-party cookie is a piece of code implanted in a user’s browser to record which websites they visit and help advertisers target personalized advertisements. It has been criticized for many years. By default, Apple’s Safari browser and Mozilla’s Firefox have blocked them.
However, Chrome accounts for about two-thirds of the browser market, which makes its impact even more significant. In addition, Google’s dominance in many other areas of digital advertising has raised concerns that it may use the end of the cookie — and the alternative system it plans to use in Chrome — to gain an advantage over its competitors.
Two weeks ago, the UK Competition and Market Authority stated worry Google “determined to continue to change[to cookies]… In a way that benefits one’s own business and restricts competition from competitors. “But it added that Google’s additional promises will reduce the risk, including the company’s promise that it will not make any changes without first giving the regulator a 60-day review period.
This concession may cause a dispute among regulators over who will play a leading role in overseeing Google’s advertising system. The European Commission announced this week an antitrust investigation into Google’s advertising technology business, including the proposed termination of cookies.
Google proposes to use a new and more private method to track users’ online interests, namely Floc, to replace cookies. Personal browsing data will be saved and analyzed in the user’s browser instead of being sent to other companies. Users will then be grouped into groups based on their interests, and other parts of the online advertising industry will be able to use this aggregated data to locate their messages.
Some critics question whether Google will Unfair advantage Because it will completely control the way the queue is designed. In addition, if the new system reduces the efficiency of targeted advertising, Google may benefit indirectly, because its direct relationship with users still allows it to access a large amount of first-party data that competitors cannot match. The company said that its own tests show that advertisers can expect the efficiency of the Floc system to be 95% of the cookie.
The company also faces opposition from privacy experts who question whether private data may still be leaked. According to an analysis by the open source organization Mozilla, the new Floc system “may pose significant risks if it is widely deployed in its current form.”
Google said it expects to complete its own testing of cookie alternatives later next year, after which advertisers and publishers will have 9 months to migrate their systems to the new technology. It added that by the end of 2023, Cookies will be phased out within three months. The company initially set a deadline for scrapping cookies early next year.