Every Telco Needs to Keep on Top of the Phaseout of Tracking Cookies. Here’s Why

By Tanya Field, CPO, Novatiq

Ever since GDPR came into law in 2018, privacy has become the North Star of the digital world. As this happens, the signals that have traditionally been used to fuel personalised digital advertising campaigns are being withdrawn. This is great news for telcos. At a stroke it opens a new revenue stream and a place at the heart of the digital marketing and adtech ecosystems. Here, we outline the opportunity at hand and assess the readiness of the market.

What’s up with adtech?

Driven by the twin streams of global privacy regulations and increasing consumer demand for privacy-conscious approaches to digital marketing, invasive technologies and approaches are being deprecated. These include mobile device IDs, used to track mobile users’ activities on mobile apps and the web. Since Apple made its ID for Advertisers “opt-in,” for instance, signals have plummeted to just 27% of their former total. Similarly, IP hashing, which uses anonymised IP addresses to track users is also falling out of favour due to concerns that it is relatively easy to restore the complete IP address.

However, the biggest change by far is the deprecation of third-party cookies – a small piece of data sent from a website and stored on a user’s computer by the user’s web browser while the user is browsing, and which enables publishers and brands to track people as they surf the internet.

Until now the foundation of personalised advertising, tracking cookies are manifestly invasive and counter to the privacy-preserving characteristics of the modern internet. Mozilla and Apple have all made moves to restrict the use of tracking cookies. Apple’s Safari browser, for instance, only accepts cookies and website data from websites a user visits. This prevents advertisers from storing data on a user’s device. Indeed, Safari users can block all cookies if they choose to do so.

However, Google, the biggest browser by market share (around 65%) has yet to make a move. When it does so, brands and publishers will see the signals they need for personalised marketing at scale fall off a cliff edge. Filling this impending signal gap is the opportunity at hand for telcos, and one that they are perfectly set up to deliver on. But before we get onto that, it’s useful to look at exactly what Google is, or isn’t planning.

The great Chrome cookie saga

For years now, Google has been setting deadlines for the deprecation of tracking cookies and consistently failing to meet them. This year (2024) was supposed to be the final deadline, with the intention of transitioning all Chrome users to its Privacy Sandbox by year end. The Privacy Sandbox is Google’s attempt to enable personalised advertising while simultaneously preserving privacy. For example, rather than tracking users for the required advertising signals, it will instead provide a high-level signal of a user’s interests based on their recent browsing history.

However, in February 2024 the UK’s Competition and Markets Authority (CMA) reported a number of concerns around the competitive fairness of the Sandbox and said that it will not sign off on the technology until these are addressed. Inevitably, Google has kicked the cookie deprecation can further down the road. As it stands, we are no closer to cookie deprecation in Chrome than we were in 2020, when Google missed its first deadline.

What Google’s delays mean for telcos

As Google drags its heels, publishers are increasingly looking elsewhere for privacy-preserving solutions to signal loss. It’s in their interests to do so. Unless they can find a practical and future-proof solution soon, they risk losing revenue as advertisers retreat from personalised digital advertising and divert budgets to more transparent alternatives where they can measure ROI. Google’s delay gives publishers more time to prepare and find the best possible solution to their needs.

It also gives telcos time to ready just such a solution. Telcos are well placed to solve the dilemma facing publishers and advertisers. The approach works something like this. Brands and publishers place a privacy-preserving identifier (i.e., one that is user consented, and anonymised) on their sites. Each time a user visits a website or app the identifier, which is not consistent, is sent to a telco to verify users against their network intelligence, helping brands and publishers recognise repeat users as the same user to build the rich audience profiles they need for personalised advertising.

Telcos can also help with audience activation. In this use case, advertisers create audiences in their trading platform. Once created, these segments are paired in real time behind the telco firewall as soon as a user comes online. When the audience matches the segment request from the advertiser, the advertiser is alerted so they can activate their campaign.

The key to success is that telcos retain control of the solution and develop a true, service-layer proposition that’s easy to integrate and deploy.

For many years now, telcos have been looking for strong vertical sector plays to drive revenue growth. The changes taking place in the digital marketing sector offer one such opportunity. Our advice is for telcos to keep a close eye on developments in the industry, while simultaneously looking at options for partnering to deliver a market facing in-network ID verification and audience activation service of their own.