Apple and Google force to rethink the advertising industry: Maurice Levy

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Maurice Levy, president of the French multinational advertising and public relations company Publicis Groupe

Dominique Charriau | Getty Images

Apple and Google’s digital privacy measures are forcing the ad industry to reconsider how it operates, Publicis Groupe’s Maurice Levy told CNBC.

The chairman of the world’s third-largest advertising company said changes to Apple’s iOS smartphone software and Google’s Chrome web browser meant advertisers had to “overhaul the whole way we work”.

“It’s not an easy win” for traditional ad agencies, Levy told CNBC’s Karen Tso on Monday.

“Privacy is extremely important,” he added. “And I think the fact that all these platforms take care of the privacy of consumers and their customers is something extraordinarily important. But it leads to a review of the way we work.”

Apple this year began requiring app developers on its platforms to seek permission before they can collect unique identifiers used by advertisers to target mobile ads and measure their effectiveness.

The company already had prohibits the use of unauthorized third-party cookies – on which many advertisers rely to track Internet users and offer them personalized advertisements – on its Safari browser.

Now, Google also plans to ditch third-party cookies on Chrome and is researching an alternative. Last week, the tech giant said it would give Britain’s competition regulator a say in its proposal to replace cookies.

The move has led to infighting in the tech industry, with Facebook and Apple squabbling over the latter’s privacy updates. Facebook is probably one of the companies hardest hit by Apple’s iOS changes and has branched out into new lines of business like online shopping in an effort to cushion the blow.

Levy said Publicis’ $4.4 billion acquisition of data company Epsilon should help shield the marketing giant from the fallout from Apple and Google’s privacy changes.

Technology tax

Apple, Google and other big tech companies are facing increasing scrutiny from regulators around the world on everything from their size to the amount of tax they pay.

This month, the wealthiest countries of the Group of Seven (G-7) agreed to a historic agreement to set a global minimum corporate tax of 15%. The move is largely aimed at tackling tax evasion by digital giants like Google, Apple, Facebook and Amazon, with a new tax system tied to where multinationals actually do business rather than where they are headquartered.

“I think the decision that was made is very good,” Levy told CNBC’s Karen Tso. “I think it’s normal for someone who works in a country to pay taxes in that country.”

Levy added: “15% is not excessive, it is a minimum. I consider it fair and I think the G-20 will accept this kind of solution.”

“As all of these platforms have a market capitalization in excess of hundreds of billions – and sometimes trillions – it is important that they contribute to the taxes of the country where they operate.”

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