Apple's Tim Cook lays into Facebook for its role in the US riots, as Zuckerberg admits iOS14 and regulatory scrutiny will weigh on FB's 2021 fortunes.

Pádraig Belton, Contributor, Light Reading

January 29, 2021

4 Min Read
It's complicated: Apple, Facebook heat up ad brawl

Apple and Facebook have changed their relationship to "it's complicated."

Speaking at a Data Privacy Day this week, Apple CEO Tim Cook blamed advertising-based social network platforms – whoever could he have meant? – for causing caused real-world violence and dehumanizing users.

It was a message about as subtle as a Santa Clara trolley.

"At a moment of rampant disinformation and conspiracy theories juiced by algorithms, we can no longer turn a blind eye to a theory of technology that says all engagement is good engagement," said Cook.

Nodding at the January 6 storming of the US Capitol, he added: "It is long past time to stop pretending that this approach doesn’t come with a cost – of polarization, of lost trust and, yes, of violence."

Just in case you wondered if Apple's chief executive was trying to apportion a very tiny bit of the blame at his rival's doorstep.

The two companies have long parted ways over their approaches to privacy.

Apple has been trying to put distance between itself and other tech companies, as Washington, London and Brussels all put big tech in their regulatory crosshairs.

The feud between the two tech giants started in autumn, when Facebook warned that Apple's iOS 14 operating system is likely to have a devastating effect on its targeted advertising.

And possibly hit its advertising revenues by more than 50%.

Apple pips up

That's because it will grow harder, under iOS14, for Facebook to track users and show them ads based on their past browsing.

Zuckerberg said "more significant" headwinds for Facebook included not just iOS14 but also "the evolving regulatory landscape."

You wonder which regulators he meant. Because there are, in fact, so many of them.

To which vast number, you can now add the UK's competition watchdog.

The Competition and Markets Authority announced on Thursday it was launching a formal investigation into Facebook's $400 million acquisition of the online image platform Giphy. Zuckerberg's company buying it may result in a "substantial lessening of competition" for consumers in the United Kingdom, the regulators say.

Zuck in the ruck

"We increasingly see Apple as one of our biggest competitors," Zuckerberg told analysts on Wednesday during Facebook's quarterly earnings call.

Apple has "every incentive to use their dominant platform position to interfere with how our apps and other apps work, which they regularly do to preference their own," he said.

Facebook is reportedly looking to lawyer up and file an antitrust lawsuit against the Cupertino-based firm.

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Advertising revenues for Facebook rose 21% in 2020, to $84.2 billion.

If you wondered just how much Facebook relied on ads, the number you want is 97.9%.

Just $1.8 billion in revenues last year came from all other activities combined.

And even though Facebook reported a 58% increase in net income, to $29.1 billion, Zuckerberg was somewhat less than brimming with tech-bro confidence about the outlook for late 2021.

Dueling bosses

As the CEOs battled, Facebook's boss gave as good as he got.

Facebook-owned WhatsApp "is clearly superior" to Apple's iMessage, which "stores non-end-to-end encrypted backups of your messages by default unless you disable iCloud," sniffed Zuckerberg.

And about that – Ireland may soon whack WhatsApp with a €50 million penalty over its data sharing with Facebook, Irish Deputy Protection Commissioner John O'Dwyer told an event at Trinity College Dublin to mark International Data Protection Day.

WhatsApp has lost more than 20 million users in recent weeks, after saying it will share more data with Facebook on users located outside the UK and EU.

Meanwhile, the financial comparison between Apple and Facebook is unflattering to Zuckerberg's firm.

Apple's profits are greater than Facebook's revenues, pointed out Robin Hood podcaster Jack Kramer on Twitter.

And Apple's $111 billion in sales in three months are "more than Tesla's and Facebook's sales … combined … and doubled," observed his colleague Nick Martell.

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— Padraig Belton, contributing editor, Light Reading

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About the Author(s)

Pádraig Belton

Contributor, Light Reading

Contributor, Light Reading

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