MOUNTAIN VIEW, CA – On Tuesday, Google (NASDAQ:GOOG) announced that it was planning to launch its own ad tracking technology as a successor to today’s third-party cookies. The move would allow users more privacy while surfing the web, or at least more say in how companies use personal information. All of which would make Google even more powerful in digital advertising.
According to a report in the USA Today, Google’s new technology would only be available to companies that agree to certain standards of conduct and it would allow users a centralized location from which they could manage their online presence and availability of personal information. In many ways, Google is the natural choice to take on a project such as this. According to reports, more than 60 percent of all internet traffic in North America passes through the company’s servers and the company has more than 30 percent share in the $ 100 billion global online advertising industry – and almost 56 percent of mobile ad revenue.
While the move will help Google to control even more of the online advertising market, some analysts are also weary the new technology might give the company too much control. According to Zach Coelius, CEO of the ad technology firm Triggit, ‘restricting third-party cookies isn’t going to make relevant advertising go away; it just hands more power to big companies.’ While Mike Zaniels of the Interactive Advertising Bureau, noted that, the situation was not ideal as ‘they could deprecate the use of that ID on a whim, basically, and severely undermine billions of dollars in digital ad spending.’
Whilst the new technology would further Google’s dominance of the online advertising market which would have a direct impact on revenues. Its release might conflict with anti-trust concerns in both Europe and the U.S. and Google will have to figure out the best approach before its release. One solution would be to spin off a separate company to control the new technology, this would also create and IPO opportunity for investors.
Shares in Google were down in heavier than average volume trading on Wednesday.