Here is a fascinating lesson in framing, courtesy Kate Conger and Brian X. Chen in a New York Times article headlined “A Change by Apple Is Tormenting Internet Companies, Especially Meta” (via Karl Bode):
Apple’s vision of a more private web is not necessarily a more profitable one for internet companies that depend on advertising revenue.
Meta’s warning and its cratering stock price were reminders that even among tech giants, Apple holds extraordinary sway because of its control of the iPhone. And the tech industry received a clear notice that a long-planned shift in how people’s information may be used online was having a dramatic impact on Madison Avenue and internet companies that have spent years building businesses around selling ads.
This alarmist story is accompanied by a chart illustrating the year-over-year declines in the prices of shares in Meta, Pinterest, Snap, and Twitter. It gives enormous credence to Mark Zuckerberg’s claims that App Tracking Transparency, which rolled out last spring in iOS 14.5, is to blame for a forecasted decline in advertising revenue.
But Facebook has made the same claim before, even as earnings grew. Also, it is not like a negative impact by App Tracking Transparency is some sort of universal truth, as implied by the Times. Here is what Conger and Chen report later in the same story:
Shares in Snap, which reported its fourth-quarter results on Thursday afternoon, fell about 17 percent earlier in the day. But prices bounced back in after-hours trading after the company said it made its first profit. The share prices of Twitter and Pinterest also dropped after Meta’s earnings report, but recovered in after-hours trading Thursday after Pinterest also reported better-than-expected earnings.
So shareholders in other companies that depend on advertising — like Pinterest and Snap — got spooked by Facebook’s earnings and forecast, but re-invested when they realized that both companies are adapting to these changes with far less grumbling. Conger and Chen also report in this very same story that Facebook is allowed to keep tracking iOS users in aggregate, which I think is pretty crappy, but should be a boon for Facebook.
Facebook should take a lesson from Pinterest and Snap in adapting to this changes rather than whining about them. The Times should do better than treat them as a reliable narrator of the current ad climate.