Alibaba executives fretting about Apple's App Tracking Transparency feature

Alibaba executives reportedly explored solutions to the ATT feature in iOS 14.5, which could threaten the company's advertising business by cutting out the flow of user data. However, sources familiar with the matter said that there was "no clear consensus" after the meeting, according to The Information.

The Chinese company currently makes more than $30 billion in annual revenue from smaller merchants and brands that pay to advertise their products to Alibaba's 900 million users. That $30 billion accounts for about 40% of Alibaba's total revenue.

Restrictions on tracking users and harvesting data could limit Alibaba's ability to target specific consumer types for its advertising clients.

The e-commerce company is already grappling with new Chinese government restrictions on what type of consumer information companies can gather. Those restrictions come amid increasing government control over internet firms in China.

Although plenty of other Chinese companies, such as Tencent and TikTok owner ByteDance, gather vast amounts of user information, Alibaba is among the most vocal about its tactics. In the past, Alibaba has even described itself as a "data company."

Since there are about 300 million iPhones in use in China, other Chinese companies have mulled ways of bypassing Apple's ATT feature. Back in March, reports indicated that the government-backed Chinese Advertising Association was developing new methods to circumvent Apple's privacy restrictions and track users.

In response, Apple warned Chinese app developers and internet companies not to bypass ATT. The Cupertino tech giant said that any attempt to do so would result in expulsion from the App Store.

Chinese companies aren't the only firms concerned about ATT. Facebook has been one of the most vocal critics of the feature, but has recently changed its tune. Other U.S. firms like Snap, Inc. and Procter & Gamble also looked into ways of circumventing the feature.

Apple released the ATT privacy feature in iOS 14.5, which debuted on April 26. ATT requires app developers to get permission from users before tracking them, and also allows users to opt out of all forms of tracking with a single switch.

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