Apple fined $8.5M for illegally collecting iPhone owners' data for ads

3 years ago (gizmodo.com)

What exactly did they do?? I’m very curious.

I have this sick feeling that in the past year, Apple is experiencing a brain drain and again the assholes with the spreadsheets (the bozos as Steve Jobs called them) are showing up and starting to chip away at things like privacy or in-app purchases for an extra .5% of profit.

My son was surprised to see an ad or in app purchase in an Apple Arcade game. But I still have to verify whether that’s what he saw.

But the rest of the games on the App Store are so disgustingly sly in how they prey on their users to buy more more more.

And Tim Cook doesn’t do anything while talking about curation. Where’s the curation?

  • Yes, they do this! I called support and they agreed that it was in opposition to their website description of Apple Arcade, but that there was nothing they could do.

    It pops up on the top of the screen every time you open the game.

    They were very cagy about it, but their excuse seemed to be that it was up to the game publisher whether to include it, and that I should complain to them (even though it was sent as an Apple Arcade notification).

    https://imgur.com/a/KOYSyTm

    • So it seems, there is a market right now, for quality adfree phones, since Apple has given up on that? Or rather they feel too secure in their entrenched space. I hope they are wrong about it.

      2 replies →

    • This is a recommendation for another Apple Arcade game. The only gain for Apple if you click this notification is if you get the game, like it, and continue to pay for Arcade. This is like taking a screenshot of Netflix's "Top Picks for You" list and saying they are ads. This notification is not from the game you're playing but directly from Apple. There's no way to ship a game for Apple Arcade if it includes ads, interstitials or in-app purchases, that's the whole point.

  • Apple failed to “obtain the consent of French iPhone users (iOS 14.6 version) before depositing and/or writing identifiers used for advertising purposes on their terminals,” the CNIL said in a statement.

    Apple claims they were using a previously approved process and their search ads on the AppStore prioritizes user privacy and will appeal.

    • "a previously approved process" is a nice claim.

      we reserve the right to change the terms and conditions... blah, blah, fucking blah.

      I'm very firmly of the opinion that an ad on the street, a billboard, or in a newspaper or magazine, or even a website (under certain conditions) is public and not private (as much as they are annoying), inasmuch as you can be filmed in public - it's a public space.

      An ad on your phone is* private as it is 'yours', your number, your unique id, your puk etc. It is sent only to you, as the owner of the phone.

      Unless you share your phone with several (quantity/ number to be debated) persons, which would have to be declared. But if Jenny or Jimmy from finance are looking at spicy underwear and I get the ad for more of the same when I'm on duty - then so be it! It would have had to have been declared a public phone (for such behavior to be acceptable/ accepted).

  • There was never a thing like "privacy" in Apple roadmap. All that buzz was to take users' private data away from Facebook and Google and bank on it exclusively.

    • Sure, since they made most of their money from paid products, they had the advantage of telling consumers we won't collect your data, and it was a powerful attack on FB and Google's business models. It was a powerful differentiator, and it worked with people like me.

      It's a case where a business motivations line up with their customers (like how FB and Google's motivations to collect data lined up with their customers motivations to get free stuff).

      But if they're breaking that now, that's a huge problem.

  • > My son was surprised to see an ad or in app purchase in an Apple Arcade game. But I still have to verify whether that’s what he saw.

    What game was this? I assumed Apple Arcade games would not have the ability to do in app purchases.

  • > Apple is experiencing a brain drain and again the assholes with the spreadsheets (...) are showing up

    > And Tim Cook doesn’t do anything while talking about curation.

    Tim Cook is THE asshole with the spreadsheets. He's shown time and again that he's an accountant with absolutely no vision other than "squeeze more money from users".

  • "With iPhones running iOS 14.6 and below, Apple’s Personalized Advertising privacy setting was turned on by default, leaving users to seek out the control on their own if they wanted to protect their information. That violates EU privacy law, according to the CNIL. It doesn’t cross the Europe’s GDPR, though; the violation falls under the more obscure ePrivacy Directive of 2002."

    They had the wrong default setting. They changed it after 14.6

  • Tim is the chief bozo to be frank…

    • I don't think so. Yes, he led Apple to become a $1T company, but making money doesn't make someone a bozo alone.

      If anything compromises Apple products, in 90% of cases it's Apple's design philosophy or (stubborn?) ideals. Not a push from the spreadsheet bozos.

      For better or worse, I think Tim managed to keep the product side of the company very close to what Steve wanted.

      7 replies →

    • I think Tim seems like the type that would be a bozo but he is really admirable in that he recognizes what he’s good at and what he isn’t. And has been willing to change the leadership to find the right people.

      There have definitely been product missteps and the typical nickle and diming of storage but it hasn’t seemed like the quality has suffered too much as you’d expect if he was a true bozo.

$8.5M is just expenses to Apple, as would be to many others; certainly not working as a deterrent. To give a figure of the money involved: Vizio made more profits during Q3 2001 by selling advertising and users data than by selling TV sets: $57.3M vs $25.6M.

https://doctorow.medium.com/vizio-makes-more-money-spying-on...

Like it or not, users data is the new oil. I don't expect any related business to resist the temptation soon or later to jump to the dark side, if not because in a saturated market you either adapt or go belly up.

This is a nothingburger. I'm surprised to see such shallow responses here.

A giant company made a small regulatory misstep in one country. Laws change constantly, missteps likely happen all the time. It's a tiny fine for a small mistake.

Did they make only $8.5mil? I doubt. Why not fine them for their profit? At this point, fines like this are treated as expenses.

  • It’s such a small amount because it’s a small infringement (incorrect default for a privacy-related setting that was corrected, I guess fairly rapidly because of the height of the fine)

  • Exactly. "Illegal with a fine" is "Legal for a price." If the fine is less than the profit, then it's just another cost of doing business.

    Edit: What's controversial about this statement? It's patently obvious, especially when you factor in the odds that your behavior will go unnoticed or unprosecuted. Do you people think I'm advocating this?!

Imagine the fine for robbing a bank was $100

  • It's actually more like $8.50 fine...

    ($100B annual income vs $100K personal income)

  • When you rob a bank, you're presumably getting at least a few thousand dollars. If the fine were actually $100, then the ROI is on the order of 10x-100x. How much money do you think apple got for "illegally harvesting iPhone owners’ data for targeted ads without proper consent"? Do you think apple made $85M to $850M from it?

I'm always interested in knowing how they got caught but there usually does not seem to be any information about that.

I don't use Stocks or News and I don't use the App Store for discovery so I don't see ads. I am fully bought into the Apple ecosystem. The second I see an ad, I am dumping all of it.

Obligatory Bill Hicks: https://www.youtube.com/watch?v=tHEOGrkhDp0

  • Don't open settings then? They advertise for TV, drive, and arcade there all the time.

  • > The second I see an ad, I am dumping all of it.

    Where will you go?

    • Android?

      I'm surprised every time I see an ad somewhere. TrackerControl seems to be an accidentally fantastic ad blocker (I got it just to block trackers) and it's super rare that an app doesn't use one of the known ad networks. It probably also helps to use apps from F-Droid whenever possible, which is surprisingly often (most of my apps are from F-Droid, some are stock like camera, dialer, and home screen, and then there's a couple like Spotify and NS/DB that are required for valid digital national rail tickets and I unfortunately can't get outside of Google Play).

> Apple failed to “obtain the consent of French iPhone users (iOS 14.6 version) before depositing and/or writing identifiers used for advertising purposes on their terminals”

Why is it so specific to that dot version?

  • Ok, I rtfa...

    >With iPhones running iOS 14.6 and below, Apple’s Personalized Advertising privacy setting was turned on by default, leaving users to seek out the control on their own if they wanted to protect their information.

    >The newer versions of the iPhone operating system corrected the problem, presenting users with a prompt before the advertising data was collected.

    So they fixed it without government pressure or not?

Always impressive and a bit saddening seeing the Apple shills crawl out of the woodwork when news like this hits the airwaves. What is it about apple that turns people into such rabid fanboys?

Apple getting into ads is not what Steve would have wanted. And all teh "well wall st." responses can stop typing because Steve didn't give an f about wall street.

Noooo, Apple, you can't take my personal data away from Facebook and Google just to sell it yourself!

Who is held responsible if a company gets fined or sued? Does someone get fired?

  • > Who is held responsible if a company gets fined or sued? Does someone get fired?

    In the past shareholders were loosing money because their shares lost some value. Then they could fire CEO/take actions to put some pain on people responsible. But now shares don't loose value or even gain it, because how absurdly small fines are. CEOs have golden parachutes and only people who get fired are nameless minions who were forced to do it. Everyone above is blameless because every decision is made by committee, so no single person is responsible for anything.

  • I think the only justification for the outrageously high pay CEOs get should be personal liability for corporate malfeasance. We should put CEOs in prison.

    • > We should put CEOs in prison

      So in an obscure settings toggle, in one version of iOS that was immediately fixed, some developer probably unknowingly set a toggle default to a setting that contravened an EU law… and you think Tim Cook should go to prison??

      I just finished reading a book where one of the chapters was about factories in north New York where the executives covered-up systematic leaking of dioxin into the local environment for decades.

      But sure - Tim Cook should go to prison to appease your Apple hatred.

      3 replies →

Everyone's focussing on the small fine but the bigger story here is it's Apple. They've gotten the reputation for being the user privacy company, for protecting you from ad companies like Google/Alphabet or Facebook. Turns out they're acting like another invasive ad company themselves. The fine may not be big but the symbolism of it is.

  • An alternate interpretation might be that the laws are so strict and arcane than even Apple, who seems to be trying to do everything right, is fined.

    • Can we give a multi-national company worth billions of dollars with a staff dedicated to legal compliance a bit less benefit of the doubt?

      It seems like Apple clearly violated the policy it rightly should establish for any software on iOS. They deserve the penalty.

      2 replies →

    • > who seems to be trying to do everything right

      They chose to use tracking tokens in the first place. By default a computer does nothing, someone was tasked to write this. Apparently they did something wrong, maybe it was an honest mistake, but I find it a stretch to just assume or expect they are necessarily choosing what's best for users (and leaving money on the table) without more info than is public.

    • maybe strict but arcane? It's pretty much the same "law" that apple put facebook under: Make personalization of ads optional and turn it off by default or at least make it equally easy to opt out and opt in (=forced choice).

      And this "arcane rule" is pretty much 50% of everything you read about GDPR (heard of cookie dialogs? they are not just banners anymore due to GDPR). Hardly arcane to me.

  • Eh, this is a massive false equivalence. Yeah, it'd be really preferable if Apple didn't do ads. They also are the hot dog stand of ad vendors; everyone else is way, way bigger.

    The difference is so obvious: Apple Maps doesn't even associate locations or directions to your Apple ID. Google stores your location at five minute intervals. The difference in privacy attitudes is vast.

    • You're right, but in the grand scheme of things whataboutism is irrelevant. As per some analysis in a paper of this on android & iOS (the name of which i don't recall, but can search for it), the main difference between the collection is not that big: Google collects more quantity whereas Apple collects every kind of data, but not as frequently.

      People talked as if Apple did not and would not ever do such things, which was obviously false. Both companies profit by the fact that we keep pointing fingers in this sadistic duopoly and not look at the actual issue of privacy. I wished people showed more interest when in was more "fashionable" to talk of such issues, but back when snowden/assange/smaller individuals did it, the discussion always ended up with ad homiminems and irrelevant points directed to the messenger. The only difference between back then & now are the perpetrators: it used to be the governments, nowadays is companies (and governments colluding with them, which is arguably worse as corporations cannot be as easily held accountable).

Wow, that's going to teach them a lesson! A whole $8.5M - That's literally only 23 minutes of 2022 revenue lost (I did the maths). I'm sure they will never do it again, despite the fact that they likely made way more than $8.5M from doing it.

If we want companies to stop doing illegal things, then the punitive consequences need to be so high that they prioritise not doing it. If a person steals $100, they could spend a decent amount of time in jail for it. Time that is worth a lot more than then $100 benefit they received. Companies want all the benefits of being a "person", so let's apply the same principles to them.

  • It will cause more damage to their brand than $8.5M ... Apple has been positioning themselves as "privacy focused" for years. They're obviously still better than Google in this respect, but it will hurt them more than $8.5M.

    • > They're obviously still better than Google

      Really? Google spies on their users. But everybody knows that.

      Apple lies to their users telling them they not spying on them despite doing exactly that.

      So who's more dishonest?

      (This question is independent from the question whether it's morally OK to spy on people in the first place.)

    • > They're obviously still better than Google in this respect

      Are they? Google is probably the most open company about what they collect and how they use it and I've never seen any evidence whatsoever that they ever sell you out ie. do more than simply link you to contextual ads.

      All their apps and services also ask for permission pretty explicitly.

      5 replies →

    • people like news stories that reinforce their perceptions, not news that tells them they're wrong. this isn't going to be widely reported on, because "you were wrong to like that company that everybody likes" isn't a nice story.

      if the fine was huge, it would be news. but this fine is an amount that's easily ignored, so it will be.

    • Repeated anti-privacy moves, like CSAM scanning, haven't affected public discourse yet. And I'd imagine that a small fine would instead convince people that it wasn't a serious violation.

    • No, this will not make a noticeable dent.

      Apple's branding and marketing are too powerful for that to happen. An obscure court ruling matters to people on HN. To the average consumer, it never happened.

    • > It will cause more damage to their brand than $8.5M

      You say that, but a non-negligble number of comments here are outright defending Apple saying "just a wrong default setting", "nothingburger", etc.

  • It needs to hurt more than just costing the company money.

    Finally people from high management need to land in jail on a regular basis for the missteps of big companies. Because those people actually don't care if they loose money they don't own themself anyway.

    • ^^^this. Apple illegally collected data. How many kids did they just commit that crime against? Jail time for c-suite management needs to happen. This whole crime is the cost of doing business is gross af.

    • > Finally people from high management need to land in jail on a regular basis for the missteps of big companies

      Amazing number of people baying for prison time for this pretty trivial mis-step.

      As I said in another comment, just finished reading a book where one of the chapters was about the Diamond Alkali works near Newark, where executives knowingly covered-up the intentional leaking of dioxin (the most lethal chemical known to man - the smallest dose will cause cancer) for decades.

      But people on HN want to put Apple employees in prison for some trivial, minor EU law contravention.

      3 replies →

  • >That's literally only 23 minutes of 2022 revenue lost

    Right, because apple is a conglomerate that does much more than just serve ads.

    >despite the fact that they likely made way more than $8.5M from doing it.

    What makes you think that?

    > If a person steals $100, they could spend a decent amount of time in jail for it.

    Realistically speaking in most parts[1] of the US you won't get any jail time unless you're a repeat offender.

    [1] saying this as a hedge in case there's some crazy judge/sheriff somewhere that's bucking the trend.

Rant: I'm so sick of the Apple App store. It absolutely pales in comparison to app stores like Steam, Epic Games or GOG. On those stores, you can buy a license, and then use that license almost anywhere. (Except, of course, on Apple Devices.) These stores compete with eachother, so they also sometimes have very good deals. (Hello actually good free games from Epic.)

On the horrible Apple App store, you buy a piece of software and you can only use it on some Apple devices. If a developer stops updating their software, odds are you'll no longer be able to use the software at some point in the future.

Even worse, most apps are listed as free, but of course, they're not free. They charge you for them, but only in some way that is completely hidden to everyone who doesn't download and install the software. Either that, or they are free, but you're overwhelmed with huge numbers of ads.

I've come to resent our overpowered iPad. I'd love to install games that I own on other devices, but Apple has chosen to make this impossible. That's extremely disrespectful to me, their customer. They sell me a device that is completely locked down. It's horrible, and in no way the dream of computing that almost everyone had when I was growing up.

  • So stop buying their stuff. It's a simple as that. As long as everybody keeps buying it the ratchet will be tightened another couple of notches.

Just look at Apple's recent job postings. Here's one, but simple searching reveals the pattern:

https://g.co/kgs/tV5rGG

They need

1. Recommendation systems experience

2. Machine Learning

3. Auction theory

4. Ads pacing

5. ML / Reinforcement learning

Gee, I wonder what they're scaling out...

Any firm making more than zero in advertising revenue is automatically untrustworthy when it comes to privacy and data collection. Apple is no exception, and their stance is more hypocritical than most.

> In 2021, the company made $3.05 billion from ads in the US, and that figure is expected to grow to $4.24 billion in 2022, according to Insider Intelligence.

Pathetic fine. More like a tap on the wrist out of the millions Apple makes every day. Surely they are sorry and they won't do it again! /s

Wait up, I am not sure what the company worth is now, I keep reading two or three trillion dollars, so let me get this straight:

Company valuation: 2*10^12

Your fine for some wrongdoing: 8.5*10^6

So, they were fined roughly 4.25*10^-6 (or 0.00000425) of their worth. This sounds like a pretty small fine. Not sure if that even stings, a little.

  • Equivalently every time you forget to pay for a parking ticket, and every other equivalent law infraction, you should be fined your total annual disposable income?

    Maybe with some punitive disincentive on top I guess. If you have a ten percent chance of being caught, then fine you 10 years of your “profit” seems a good appropriation. Just make it a year’s salary - that is a fair approximation that everyone would understand. You certainly would learn to pay more attention to the many thousands of minor laws you need to personally adhere to.

    Edit: I especially want to see some of those rich-ass software devs working for letters from ACRONYMS get taken down. I’m safe: I live in New Zealand and I can’t easily work at a letter of an ACRONYM.

    • IIRC Sweden (or one of the scandis) does exactly that, a parking ticket is based on a percentage of your gross yearly wage (or something to that effect, maybe the sticker price of the car?) rather than being a set cost, since otherwise those kinds of fines disproportionally target lower income individuals while it becomes a small hassle that the wealthy pay off and forget about.

      Corporate fines should work similarly, any infraction no matter how small should be fined at a % of their cashflow. I think Apple, with their 2 Trillion(!!!!) Dollars can hire a lawyer or two to make sure they're not breaking any silly privacy laws, after all :)

  • I would wager they spend more than that a week globally on coffee and plastic ware in the cafeteria . Or other similar incidental expenses.

    This is nothing.