Are Privacy Concerns Surrounding Facebook, Inc's Atlas Ad Tool Warranted?
Say what you want about Edward Snowden, there's no denying he opened a large can of worms when he disclosed just how much U.S. citizens are being monitored by our government. Tracking emails, Internet usage, and even mobile phone calls, while long a concern of some, came as an unwelcome surprise for many of us. Even before Snowden's revelations, questions were being asked about how much information online giants like Facebook and Google are collecting and utilizing to better target what they determine to be relevant ads to their users.
News that Facebook has rolled out a new, pseudo-ad network has many wondering whether or not the king of social media will soon have access to even more information on us. Perhaps more importantly, how will they use this new treasure trove of data? And as more consumers become aware of the depth, and breadth, of information being collected, should Facebook investor's be concerned that an intrusion of our privacy will slow its user growth, ultimately impacting future financial results?
Facebook bought Atlas -- which is essentially an ad network on steroids -- from Microsoft about a year-and-a-half ago. At the time, Facebook investors were clamoring for it to roll-out a means for advertisers to connect and post spots on its web site, aka an ad network, with an easy-to-use tool. Turns out, Facebook has been fine-tuning Atlas since the acquisition, and recently made it available to its marketing partners.
What makes Atlas unique, at least for Facebook, is it provides advertisers a tool to purchase ads across multiple sites, including non-Facebook properties. The beauty for advertisers is they are able to utilize Facebook's reams of user data to target their spots, on virtually any site on the Internet. Great news for them, and it's easy to see why many marketing departments would be excited. In terms of digital advertising, particularly display ads, no one delivers results like Facebook does.
The scary part
Utilizing Atlas, marketers have access to all of Facebook's invaluable user data, but aren't restricted to placing their ads on Facebook. Heck, advertisers could, and likely will, use Atlas to put ads on Google properties. Facebook's new ad network also gives advertisers data on the results of their ads, much like Google's done for years. What makes Atlas unique is it can accomplish all of the above on user's mobile devices. Historically, that's been a touchy proposition, and much of the data collected and used by the Facebook's and Google's of the world for advertising purposes has been limited to the desktop. But no longer.
What has some consumers concerned, and investors wondering if current Facebook and Google users will shy away from their respective sites, is just how far-reaching Atlas and Google's own recently released updated ad network tools actually are. By allowing Facebook to track user's mobile usage, Atlas changes the privacy landscape. In fact, in many instances, Atlas is able to match a mobile user's data with his or her desktop usage. Not surprisingly, that kind of insight might feel a bit creepy to some.
Should investors be worried?
As consumers, when potential infringements on our privacy arise, many of us are rightfully concerned. However, for Facebook investors, Atlas could prove to be a significant revenue enhancer. How? Facebook is able to charge some of, if the not the, highest digital ad rates on the planet precisely because it collects, analyzes, and utilizes vast amounts of user data to target its ads like no other.
Now, with Atlas, Facebook is able to track and store user's mobile activity -- over a billion of its 1.32 billion monthly active users, or MAUs, are mobile -- from both its sites, and any other with an Atlas-placed ad. If marketers were happy with Facebook ad results before, the additional data collected and used to target ads with Atlas should make them ecstatic. Improving its already industry-leading ad results will then translate to higher fees per spot, boosting revenues in the long-run.
Final Foolish thoughts
On the surface, Atlas and new ad network tools, like those recently announced from Google, will make many of us uncomfortable. But really, not much will change when it's all said and done. Facebook, Google, and even our government, has been collecting reams of data on all of us for years. The introduction of Atlas brings the privacy discussion to the forefront, but what's really changed? For good or bad, the answer is: not much.
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The article Are Privacy Concerns Surrounding Facebook, Inc's Atlas Ad Tool Warranted? originally appeared on Fool.com.Tim Brugger has no position in any stocks mentioned. The Motley Fool recommends Facebook, Google (A shares), and Google (C shares). The Motley Fool owns shares of Facebook, Google (A shares), Google (C shares), and Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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