by: Luke Barbin, CEO

There is a new age data war brewing in Silicon Valley between Apple and Facebook et al.  While Apple is well positioned on moral high ground, Facebook appears to be fighting with old artillery.  But does Facebook have a secret weapon they have yet to deploy?

In June 2020, Apple announced their new iOS privacy features that will require apps to obtain user permission to track user activity for advertising.  These new privacy features are set to be released in early 2021.  Interestingly, for years, Apple has required that apps request in-app permission to access things like cameras, microphones, photo libraries, and contacts libraries on users’ iOS devices.  The upcoming privacy features are quite simply going to require a similar permission prompt that allows users to opt out of this sort of data collection and tracking.  Facebook could stand to lose billions of dollars in ad revenue if/when significant volumes of its app users opt out of this activity tracking, and Facebook argues its small business customers will be the most affected due to reduced ability to effectively target potential customers with ads.

Facebook has publicly opposed Apple’s new privacy features, and has initiated a very expensive campaign to paint Apple as the bad guy for launching these features.  The problem is that, in my opinion, Apple has the moral high ground in the argument, that moral high ground being data privacy and user choice.  Further, Apple is not disabling the tracking of user activity for advertising, they are simply notifying users and giving them the choice to disable or to participate with their data much like users already do with their cameras, photo libraries, and contacts list.  I think it is an extremely uphill battle for Facebook to argue that users should not have control/choice over access to metadata related to their online activity while its users already have control over camera/photo/contacts access within Facebook apps.

Facebook has excoriated Apple through press releases, webpages defending the small businesses, remarks to investors from its CEO, and full page ads in the @nytimes and @washingtonpost among others.  These are all very old school PR tactics considering Facebook is a modern technology driven company.  Moreover, Apple has a corporate legacy of not succumbing to consumer pressure, and Steve Jobs was notorious for ignoring market research and consumer opinion.  Apple often adds features, removes ports/parts, and provides products and services that are not popular at time of launch but that later, sometimes through brute force, become industry standards among their competitors. Just yesterday, Google announced that it too is exploring activity tracking privacy features in Android OS.

Despite these features potentially affecting small business’ ROI in online advertising, Apple seems to be well aligned with most users who, when given a choice, will likely choose privacy over better targeted advertising.  I assume that Facebook has done market research and is predicting that statistically significant numbers of users will opt-out of activity tracking when given the choice by iOS 14, and this author is no exception.

Apple’s responses to Facebook’s public posturing have been nonchalant.  They’ve released very few official statements or reactions.  Although last week, Apple CEO Tim Cook stepped into the fray by providing some very public comments on this issue (without mentioning Facebook by name):

"Technology does not need vast troves of personal data stitched together across dozens of websites and apps in order to succeed. Advertising existed and thrived for decades without it, and we're here today because the path of least resistance is rarely the path of wisdom…If a business is built on misleading users on data exploitation, on choices that are no choices at all, then it does not deserve our praise. It deserves reform.”

Where does this leave us?  Facebook recently indicated that they are “exploring all options” including supporting Epic Games in its antitrust suit against Apple or perhaps filing their own antitrust suit against Apple.

I believe there is a weapon that Facebook already has or has the resources to obtain that might be very useful in preventing/hampering the deployment of these privacy features….and one where Apple’s moral high ground is no real defense to its effectiveness?  PATENTS.

Apple’s new privacy features and general functionality are fairly well known.  Apple has published a good deal of information on how they work, and they are similar to existing opt-in/opt-out features on iOS devices today.  Therefore, we have ample evidence of what its use will be when the features launch sometime this year.

Using this evidence of potential use, we directed our AI and objective-based patent research platform Limestone|Report to generate a landscape of active assets related to these software features.  The results are VERY interesting. I am quite certain that there are multiple patent families available which may be applicable and used defensively by Facebook and others against the deployment of these new privacy features.

The question is whether Facebook is exploring patent infringement as an option of attack and whether they own or have identified/purchased patents that may be deployed after feature release by Apple?  It seems Facebook has nothing to lose, and they are running out of options and time.

Contact us if you’d like to learn more about this patent landscape or the services we provide to help folks find patents for monetization activities.

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