IAB Tech Lab: Google Privacy Sandbox faces "significant challenges"

IAB Tech Lab has published a new report on an "early analysis" of Google's Privacy Sandbox which the authors say reveals "operational, transactional, and commercial concerns, measurement metrics challenges, and scaling obstacles" to adoption of this initiative by the advertising industry.

Per Google, the Privacy Sandbox proposal aims to create technologies that protect users' privacy online while enabling advertisers to build "thriving digital businesses."

Core aims of the Privacy Sandbox are to:

• Phase out support for 3rd-party cookies
• Reduce cross-site and cross-app tracking while keeping the web free for all

The Privacy Sandbox APIs would require web browsers to act locally to protect a user's identifying information.

As of right now, 30+ sandbox proposals are being tested for possible adoption as web standards.

Problematic Sandbox issues identified by the IAB Tech Lab analysis include:

• Because impressions and clicks will ultimately be reported in aggregate, bid loss analysis will be impossible and revenue reconciliation will be difficult.
• New brand safety concerns will cause advertisers to have to negotiate threats to the integrity of their ads.
• Having an ad exchange and ad server within Chrome will require significant retooling of programmatic advertising.
• Failure to incorporate legal and business requirements into Chrome when it participates in financial transactions and delivery of goods could result in legal penalties and loss of trust for advertisers.

Primary focus of the IAB Tech Lab analysis was Chrome's Protected Audience APIs (PAAPI) but analysts also scrutinized other Sandbox proposals including Topics, Private State Tokens, Attribution Reporting and Fenced Frames.

IAB Tech Lab CEO Anthony Katsur summed up the group's conclusions this way:

“Our findings highlight that the industry isn’t ready yet and identify multiple challenges to implementation due to limitations in accomplishing key advertising objectives. Chrome is focused on providing discrete components that support aspects of use cases, but which ultimately cannot be assembled into a whole that provides a viable business foundation.”

Mr. Katsur went on to say:

“The Tech Lab welcomes the Chrome team’s feedback on this analysis,”

In its response to the IAB Tech Lab report, Google said, in part:

"In our view, the analysis contains many misunderstandings and inaccuracies, which we consider important to correct in order to provide accurate information to the ecosystem."

Google also commented extensively on IAB Tech Lab's technical assessment regarding programmatic advertising, and confirmed its plan to aim to phase out 3rd-party cookies later this year.

Reactions to the IAB Tech Lab report from the advertising community were mixed.

Stay tuned for updates.