What is Apple’s iOS 14.5 controversial privacy update and what does it mean for you?

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IPhone and iPad users are now able to choose whether they want to be block apps from tracking them around the web.

Apple’s new tool is designed to give users more transparency and control over apps that want to track them for advertising.

The latest software update iOS 14.5 - which became available to iPhone users on Monday evening - includes the App Tracking Transparency (ATT) tool.

The tool requires developers wanting to collect data outside of their app to ask for user permission.

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But the move has angered tech giants Facebook and Google, whose advertising models are based on profiling users and selling targeted ads at them.

What does the Apple iOS 14.5 update mean for users - and how have its rivals reacted?

What is tracking?

Many apps use tracking and the data collected from it to inform targeted advertising. Many apps send data to multiple partners, including Facebook and Google. As we move around the internet, we leave a trail of data behind that is foraged by apps and shared with third parties.

Apps and website harvest information on you including your location, other apps you are using, your phone number, and a unique number that identifies your iPhone, known as IDFA (Identifier for Advertisers).

It is this IDFA that allows advertisers to build a profile of your online behaviour. This is why you are followed around the internet by ads for products you have searched for. These ads are a key resource of revenue for companies, but one that is also a source of concern for many privacy advocates.

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What does the update mean for me?

ATT means that Apple users have to explicitly give their permission for an app to access their IDFA. So, the first time a iPhone and iPad user opens an app - Instagram for example - after downloading the new update, they will get a pop-up prompt asking if they would like to give permission for the app to track their activity outside of the app.

After downloading the update, the first time a user opens each app they will be asked to answer the question: “Allow (app name) to track your activity across other companies’ apps and websites?”

This alert will also feature some text from the developer, where they are able to disclose why they would like the user to grant permission.

Will I stop getting adverts?No. You will still get adverts they will just not be personalised. So, for example, you will not be followed around the internet for a pair of red shoes because you once searched for 'red shoes'.What do the likes of Facebook and Google feel about it?Facebook is worried the changes will hit their $80bn-a-year business model built on advertising and has even resorted to taking out full page adverts in several newspapers warning the update will be felt most acutely by small businesses who rely on online ads to stay alive.

But the small business argument only tells some of the story. The digital ad industry is worth more than $350bn annually and not being able to target people with relevant adverts is likely to have a big impact on the revenue streams of advertising industry and app developers who rely on this business model.

Users will be asked to give their permission. Credit: Apple

Over 200 million businesses use Facebook's family of apps and the tech giant argues the changes will cause a 60% decline in sales through advertising and reduce the social media company's revenue by billions of dollars annually.

A Harvard report, however, says that figure is too high, but estimates say Facebook would lose the ability to target over half their audience.

Google also depends on personal information to fuel a digital ad network even bigger than Facebook’s, but it has said it would be able to adjust to the iPhone’s new privacy controls.  

Meta’s Mark Zuckerberg plans to focus on building the metaverse, which is costing billions of pounds a year Credit: Niall Carson/PA

What do Apple say about the update?

The tech giant’s boss Tim Cook has previously hit out at the tracking approach, saying those seeking to profit from personal data were causing real damage to society and linked their rise to the spread of misinformation.He argued that such endless tracking would eventually mean “you are no longer the customer, you’re the product”, adding that this was not an approach Apple agreed with.

Earlier this month, Apple’s chief privacy officer, Jane Horvath, said the new tool was “just part of the evolution of protecting our users”.

“Users should have transparency about how their data is used – They should have control over whether their data is used for tracking as well,” she said.

What other features does the iOS 14.5 update include?

Elsewhere in the iOS 14.5 update, Apple has introduced the ability for people who use Face ID to unlock their iPhone via their Apple Watch even when they’re wearing a face mask.

The feature works by registering that the user’s nose and mouth are covered by a mask, but will unlock if their Apple Watch is on their wrist, unlocked and in close proximity to the iPhone.

The user will receive a vibration on their Watch when the phone unlocks and will give them the option to lock the device again instantly if they so wish.

The update also includes a redesign of the Apple podcasts app and a number of new emoji, including a broader range of skin tones in some emoji that feature couples.