Apple Software Update Forces Companies To Ask For Permission To Track Data

It's no secret that the smartphone apps we use track our online habits and build a profile that is used to send us targeted advertisements, but that's changing for people who own an Apple device; Nancy Chen reports for CBS2.

Video Transcript

KRISTINE JOHNSON: It is no secret that smartphone apps track our online habits and then build a profile that it uses to then send us targeted advertisements.

DICK BRENNAN: But that's changing for people who own an Apple device. CBS 2's Nancy Chen has the story.

NANCY CHEN: IPhone and iPad owners are seeing something new when they open an app on their device.

- It's the new app tracking transparency prompt. It's a feature that gives you a choice-- a choice on how apps use and share your data.

NANCY CHEN: Apps can track online behavior including shopping habits, location, age, and even medical info. But data is being used to target us with specific ads. Apple's latest software update forces companies to ask for permission. It's expected most users won't grant that permission, which could lead to big changes in online advertising.

DAN PATTERSON: Some are even calling this the ad-pocalypse.

NANCY CHEN: CBS News tech reporter Dan Patterson says app developers and ad companies stand to lose billions of dollars.

DAN PATTERSON: Because they'll simply no longer be able to build businesses around selling targeted ads.

NANCY CHEN: Facebook is one of the apps fighting against the Apple change. Earlier this year, the social network took out ads, arguing it will limit how small businesses reach customers. But tech experts say even with the new permission privacy setting, apps will still be able to gain some insight about users.

ALLEN ADAMSON: This allows you to still help advertisers make your messages relevant without telling them what you're doing Tuesday afternoon at 2:00 PM.

NANCY CHEN: Allen Adamson is co-founder of the marketing firm Metaforce and says advertisers will adapt.

ALLEN ADAMSON: There'll be some new technology. It will change things, but it's not going to disable the marketplace at all.

NANCY CHEN: Google is reportedly looking into a tracking software for Android devices, possibly giving its users the option 1 billion iPhone owners now have. Nancy Chen CBS News.