• by Paul Cook , August 10, 2010

Apple -- not privacy legislation -- is the digital sector's greatest challenge.

One day this May, when Apple's market cap took it past Microsoft, alarm bells should have been ringing much more loudly in the digital sector than they did.

Apple's new peak -- at $221bn, $3bn more than Microsoft -- was reached the month after the company had unveiled the iPad and its mobile advertising platform, iAds. In other words, it was the month after Apple's long-awaited media play became reality.

Recently, those in the first wave of iAds were revealed -- have a look at Nissan's iAd for the Leaf electric car to see one of the first examples. It is a reminder that we should be thinking about how on earth our existing digital ecosystem will remain relevant when Apple's own is growing evermore powerful. For this is a much more challenging trend than privacy legislation, the rise of social media, or the new, Google network approach to display advertising.

The threat of Apple is revealed in its model for success. The company has built the best, most usable consumer electronics on the planet by keeping the design and development of both the device and the operating system in-house. It also exercises fierce control over third-party applications.

This model is arguably the only way to deliver a seamless user experiences but it also ensures that everyone else is locked out. Consider some examples of how the developing, parallel digital ecosystem built by Apple might be a real problem for the existing industry:

1. In Apple's world, the browser of choice, Safari, does not accept 3rd-party cookies by default. How can we target/retarget/behaviourally target ads to users -- let alone gain their permission -- when we can't cookie them?
2. In Apple's world, the advertising platform, iAds, in no way syncs with existing ad serving systems such as DoubleClick. How can we serve and track campaigns across both platforms in an integrated way?
3. 3. In Apple's world, all the development going on outside it is, at best, tangential. How can we plan, innovate and develop for two, parallel, universes?

If Apple's version of the digital universe were to reach real scale, then it is this, not privacy legislation, that poses the greatest challenge to the development of digital. One signal of its success is the amount of people accessing digital content through Safari compared with other browsers. TagMan's site analytics reveals that, over the past year, share of traffic to the site via Safari grew more than 80%, a higher growth in share than any other browser.

If more people are coming to digital services through the Apple-controlled ecosystem of which Safari is a fundamental part, then cookies -- and all the digital marketing and media that rely on them - are in danger of becoming obsolete and privacy legislation to regulate them is the least of our challenges.