Meta rivalry with Apple inflamed as Facebook parent company share price plummets – The Guardian


Zuckerberg blames ‘headwinds’ from Apple’s new iOS and changes in privacy for the record drop in value

Mark Zuckerberg blamed “headwinds” this week after investors wiped about $220bn off Meta’s market value. One of the biggest blows came from longtime rival Apple.

Apple has long marketed itself as a champion of privacy, explicitly positioning itself in opposition to Facebook. Tensions between the two giants escalated with the release of Apple’s new operating system, which Meta feared would hamper its revenue model.

On Thursday those fears came true as Meta’s share price fell 26% in what could be the largest single-day wipeout in market value for a US company.

Meta blamed increasing competition for the dismal forecast, as well as privacy changes instituted by Apple last year.

The impact of Apple’s changes could be “in the order of $10bn” this year, the company said. The updates hurt advertisers’ ability to target ads to potential customers and measure the effectiveness of ads.

“We believe the impact of iOS overall is a headwind on our business in 2022,” Dave Wehner, Meta’s chief financial officer, said during the company’s earnings call on Wednesday.

Apple’s privacy changes allow users to prevent apps from tracking their online activity for advertising purposes. Now, iPhone users can optout from unwanted tracking, and a majority have chosen to do so.

Yet the changes didn’t hit other large tech companies that hard – or at all. Snap on Thursday said its advertising business bounced back from the effects of the changes faster than it expected, and shares of the company skyrocketed 50% as it provided a first quarter outlook that surpassed analyst estimates.

Amazon reported ad revenue of $9.7bn for the fourth quarter, up 32% from last year, and $31bn for the year, revealing an ad business larger than that of Google’s YouTube. Analyst Benedict Evans on Twitter said that made Amazon’s ad revenue similar in size to the entire global newspaper industry, and Statista put global newspaper annual ad spending at $29.5bn.

An Amazon official told reporters that brands’ ability to reach consumers across its ad properties was “largely unchanged” after Apple’s changes.

Pinterest, too, reported growth in the fourth quarter, despite Apple’s changes. Although its user base shrunk, the photo-sharing platform has focused on scaling its advertising model, which the market rewarded. The platform beat out analysts’ predictions, sending company shares up more than 25% on Thursday.

Meta CEO Mark Zuckerberg and Apple CEO Tim Cook have feuded for months over Apple’s changes. “The issues have been different over the years,” Ari Lightman, a professor of digital media and marketing at Carnegie Mellon University’s Heinz College, previously told the Guardian, “but consumer privacy is always at the heart of it, and with this update, Facebook could be in trouble.”

Already in 2014, Cook warned that users should be “worried” about apps that collect user data. Four years later, he took a jab at the Facebook and Cambridge Analytica scandal, saying that he “wouldn’t be in this situation” in the first place.

Kari Paul contributed to this report.












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