Key Questions Need to Be Answered After Google Delays the Cookiepocalypse

After 18 months of handwringing, claims and counterclaims, plus overall confusion, Google has granted what many in ad tech have prayed for: a reprieve from phasing out third-party cookies. Google’s Chrome browser was initially slated to withdraw support for the cornerstone of behaviorally targeted advertising next year, but this week it issued a revised timeline with the online ad giant now proposing a 2023 migration. Beset by disagreements over methodologies and delayed by regulatory concerns Privacy Sandbox, Google’s proposed tool set to help the industry migrate toward cookieless ad targeting, simply wasn’t ready for industry adoption per the initial timeline. Why now? The impact of Covid-19, which hit the global economy soon after Google Chrome set out its timeline to sunset third-party cookie support, prompted members of W3C’s advertising working group to request a delay in March 2020. These pleas fell on deaf ears at the time, but since then regulators on both sides of the Atlantic have dialed up the pressure on Google’s ads business with sources believing such scrutiny has prompted Google to tap the brakes. Ana Milicevic, principal and co-founder of Sparrow Advisers, told Adweek, “There simply were too many balls in the air at the same time: the prospect of the whole of the open web being severely economically impacted by the actions of a single company likely would not have been well received by regulators in multiple jurisdictions.” Earlier this month Google agreed to regulatory oversight of Privacy Sandbox after an investigation by the U.K.’s Competition and Markets Authority with the inner workings of its ad stack, popularly known as DoubleClick, facing similar scrutiny in the U.S. Wayne Blodwell, CEO of The Programmatic Advisory, described Google’s latest decision as a “pragmatic” given that Google ultimately has to tread a fine line that involves complying with multiple privacy laws and placating competition authorities. All of this must be achieved while continuing to service the needs of advertisers and publishers alike. Here’s What Google’s Cookie Deprecation Delay Means for Publishers and Marketers “They know the value of identity for an ad-funded internet and that contextual targeting & various alternatives won't make up the short-fall for brands targeting and measurement requirements or the ability for publishers to monetize successfully,” he added. Early resistance Proposals such as FLoC, a mechanism that targets user cohorts instead of individuals, and FLEDGE, a means of auction ad space within a web browser instead of an external server, were met with concern. Notable FLoC dissenters included Amazon, according to press reports, leading publishers including The New York Times and The Guardian as alternative web browsers such as Mozilla’s Firefox with the parties citing commercial and privacy concerns. Attempts to rollout FLoC trials in the EU also hit an encountered unexpected difficulties with confusion over GDPR requirements which parties take legal responsibility for the processing of user data. David A. Steinberg, chairman and CEO of Zeta, welcomed Google’s delay as an opportunity for the industry to “discover and implement improved identifiers” but several sources told Adweek how Google has to reveal more data to convince them of the efficacy of FLoC-based targeting. Concerns For instance, Google has published claims noting that early tests of FLoC-based ad targeting achieved 95% of the efficacy of cookie-based ad targeting. But several Adweek sources with knowledge of debates within W3C working groups, where Privacy Sandbox is being debated, are dubious and want more data. Zeta Global's Joshua Koran told Adweek, "The Google engineer who ran 'the 95% study' promised that he would disclose, not just the methodology, but a white paper explaining how he accomplished such a surprising result that many people misinterpreted as comparing FLoCs to third-party cookies." The promised whitepaper has yet to be published with a Google spokesperson unable to respond to Adweek's request for progress update by time of publication. "There are many skeptics over the Privacy Sandbox and there are many unanswered questions," explained The Programmatic Advisory's Blodwell. "For instance, is it impossible to identify a cohort back to a specific user, either with the cohort itself, or when companies are appending the cohort to other data?" Meanwhile, sources are also concerned how other Privacy Sandbox proposals could disintermediate publishers as well as handicap advertisers' ability to measure campaign effectiveness. Koran added, "FLEDGE moves auction services from the publisher's ad server to both a Chrome front end and Google-controlled back-end servers, without actually improving people's privacy." Sparrow Advisers' Milecivic said the extended timeline is a tacit admission from Google that there "too many unknowns to work through" around the performance levels marketers can expect. "Will marketers be able to adjust their attribution modeling sufficiently to continue making investments in the open web, versus in walled gardens," she said, "and then there are implications outside of advertising to consider (e.g. in fraud prevention)." Blodwell also noted how large publishers will have to consider if the Privacy Sandbox proposals would mean they suffer through data leakage into the long tail of the open web. "There are plenty of incredible proposals within the Privacy Sandbox and it has some of the industry's smartest minds behind it, it's simply going to take time to work out which proposals can work in practice," he added. "This isn't a small task, but I for one am very optimistic about what this means for the sustainability of the ad-funded internet as this approach is positive-sum not zero-sum."