With Android changes, Google treads narrow path between privacy, antitrust scrutiny

As Google announced today that it will gradually change the access to personal data of apps on the Android platform, it signaled a more collaborative and deliberate approach than Apple’s — but one that will nevertheless have to navigate the Scylla and Charybdis of privacy and antitrust scrutiny.

In a blog post today, Android's chief of security and privacy, Anthony Chavez, said Google will take several years to design technology that will change the way third-party Android apps can use personal data, “with the goal of introducing new, more private advertising solutions.”

In a clear reference to Apple’s launch last year of its AppTrackingTransparency policy that requires iOS users to choose whether to allow apps to track them, Google said “blunt approaches are proving ineffective” and it will concentrate instead on efforts to "develop effective and privacy enhancing advertising solutions, where users know their information is protected, and developers and businesses have the tools to succeed on mobile.”

While Google appears determined to take a less adversarial position toward apps’ use of personal data than Apple did — perhaps not terribly surprising because Google gets most of its revenue from ads, while Apple doesn't — the move will cause worry for other ad-supported tech companies. Think Facebook, which said this month that Apple’s app privacy changes will cost it $10 billion in revenue this year.

What is clear is that in the wake of Apple’s changes and growing regulatory pressure such as European Union and US legislation to ban targeted advertising, and Android privacy enforcement actions filed by four US state attorneys, Google made the call that the world’s other dominant mobile platform couldn't stand pat on how Android apps access and use personal data.

“In order to ensure a healthy app ecosystem — benefiting users, developers and businesses — the industry must continue to evolve how digital advertising works to improve user privacy,” Google said in today’s post.

To signal the more collaborative approach it's taking, Google released a list of app developers including Snap, DoorDash, Activision Blizzard, Rovio and Duolingo that said they're willing to work with Google on the Android changes.

"We support Google's effort to elevate privacy standards on the platform, while making it easier for users to understand how their data is being used," said Alex Pelletier-Normand, the chief executive of Rovio. "It's great they are involving developers in the process early to make sure we have time to react and participate in such an important change.”

Because just two US companies own the gateways for app developers both large and small to deliver their software products in much of the world, anything Google and Apple do that limits the ability of app developers to use the personal data of their users could carry the whiff of an antitrust violation.

Google is already moving to phase out third-party tracking cookies on its Chrome browser, prompting the UK’s Competition and Markets Authority to open a probe last year into whether Google’s “Privacy Sandbox” effort could cause advertising spending to become concentrated on its advertising ecosystem at the expense of competitors.

Google scored a victory last week when the UK CMA warily accepted Google's pledge to restrict internal sharing of data, among a raft of commitments over its "Privacy Sandbox" project accepted by the UK competition watchdog. But other challenges loom.

In the US, Google faces a trial next year on claims by a group of states and app developers that the company abused its control over the Android operating system to monopolize app distribution and in-app payments on mobile devices. And Apple’s privacy changes didn’t come without antitrust trouble: Even before Apple launched its app privacy initiative last year, it was hit by an antitrust complaint in France.

As Google tries to develop new Privacy Sandbox technology that will replace the advertising ID on Android phones — a unique, user-resettable ID code that allows apps to track an Android phone users’ online activity — it will have to walk a tightrope between giving Android users more transparency and control over their data, without prejudicing its own apps by giving them access to better data than independent app developers get.

The stakes will be high for Google as well as companies with apps on the Android platform. While the big antitrust suits against Google’s search, ads and app store practices have captured more attention, the first major regulatory trial Google faces in the US won’t be an antitrust case. That trial will be on the state of Arizona’s claims that Google tricked Android users into sharing more location data than they thought they were sharing.

That Android trial starts Oct. 24, exactly 250 days from today.