26 Oct 2021
The Index Today
Facebook Inc. has reported slower ad sales for the first this full quarter, blaming Apple Inc. new privacy rules which requires all apps to ask users if they wish to be tracked. The new changes to privacy policies means advertisers will find it increasingly difficult to target their ads to desired audiences and receive information about ad effectiveness.
The social media platform has also stated upcoming changes to certain reporting structures to design a unit which focuses on augmented-reality called Facebook Reality Labs. The unit will remain separate from the corporation and its applications.
Mark Zuckerberg, CEO of Facebook discussed the growing competition in the market and how retaining young users has become increasingly difficult due to growing popularity of apps such as TikTok. He said during an analyst call, “We are retooling our teams to make serving young adults their North Star, rather than optimizing for the larger number of older people.”
Facebook’s recent whistleblower scandal has also added to the dropping sales figures as more people become skeptical about the corporations intentions. The company is facing multiple challenges on all fronts from lawmakers, users, and even academics across the globe. Apple’s privacy changes have not only affected Facebook sales but also have managed to slowdown revenue growth for Snap Inc. On Monday, Facebook shares went up 3% but then went down by 5% after Snap Inc reported the decline in sales caused by Apple Privacy Policies.
In light of recent events, CEO Mark Zuckerberg responded, “I’m proud of our record navigating the complex trade-offs involved in operating services at global scale. It makes a good sound bite to say that we don’t solve these impossible trade-offs because we just focused on making money, but the reality is these questions are not primarily about our business, but balancing different difficult social values.” According to reports, revenue in the third quarter went up to $29.01 billion. However, ad revenue was lower from the second sector in regions of US and Canada.