Why the Cookie is Really Crumbling

Cookies are going away! Wait. Oreos? Chocolate chip? Not that kind of cookie. Third-party identifiers, a.k.a. cookies, are going to be deprecated (no longer used) by Google starting this year. That’s not right. Next year. Nope again. In 2024? There it is, or at least that is the latest date Google has given the us. Why does Google keep moving the ball? Because they are not ready; they have not figured out how to deal with the monetary consequences of ending cookies. So then, that probably makes you ask… “Why are they doing away with cookies at all?”. That’s it, that’s the question for today. Sneak peek? Apple.

We have to start with some history. Consumer privacy has become more and more of a consistent topic over the last decade. First, it was creepy ads that knew what you looked at on Amazon or Walmart. Then it was ads that almost predicted you needed a thing before you even knew you needed it. Most recently it has been people accusing their phones of listening to things they say. I am in ad tech and have been for a long time. Some of it is true. Some of it is paranoia.

So how does Apple figure into this? Well, Apple does a lot, A LOT, of consumer research; that research showed them that this privacy thing was a big thing. So, Apple does what they do, they evaluated the business impact - and found an opportunity. First, people care about privacy, and Apple has the ability with their devices to implement layers of privacy-centered changes. Some of the things they ultimate implemented were elimination of IFDAs (IDs for Advertising – essentially cookies), defaulting tracking to “off,” proxy emails (proxy just means one time use, or “burner”), and maybe in the future - proxy phone numbers and IP addresses. There are some serious consequences to talk about with that, but that is for a different piece. The point is that Apple had a lot of levers they could pull, and they basically pulled them all.

At this point you are probably wondering where does this impact Google, right? Okay, so part of Apple’s evaluation told them that they have almost no exposure to advertising revenue – which is the primary use for cookies. Short aside here to explain: Cookies act like trackers that attach to you as you move around the internet. Those trackers are used to tailor advertising messages to things that you might be interested in based on your browsing history. You look at one car your friend shared on Facebook, now every site you go to has an ad for a Chevy, or Honda, or a local dealer. Again, there is a whole secondary article where we can talk about why this is good or bad; that's not the point here. This is a large part of what cookies do, but let's get back to Google. Unlike Apple, Google has massive exposure to advertising revenue. You might think of Google as a search engine – that is only scratching the surface of THE GOOGLE.

Google has ad revenue in a multitude of places. Suffice to say that they have billions in revenue exposure when cookies go away. So frankly, I do not think that Google would care if cookies never went away, but… you know another way Google makes money? Devices. And Apple is telling everyone how they care more about privacy than Google. Which gives them a marketing leg up so they can sell more phones and iPads. And there you have it. Google has revenue exposure on both ads and devices.

They have been scrambling to figure out what they can release to replace cookies. They tried something called FLoC – Federated Learning of Cohorts – no I am not kidding, and no that is not a bad Marvel team name. Then there was FLEDGE, and most recently they tried something called Topics; they got made fun of pretty hard for that one (look up the DigiDay video about Topics). Bottom line is that they cannot come up with a good replacement, so they keep kicking the can down the road.

Now you know why Google keeps delaying, and what is behind the drive to eliminate cookies. Now… I am confident that Google is going to get their hand called in the not-too-distant future. It is only a matter of time before the federal or state governments get involved to enforce the deprecation of cookies. The end is coming… Better get ready for it if you are business. And if you are just a consumer? It is not great for you either, believe it or not. Again, that is for a different article.

Please let me know in the comments if you want me to write some of the other potential articles I referenced, and thanks for reading my work.