What’s the Latest with Cookie Alternatives?

Google plans on sunsetting third-party cookies sometime late next year.

Though the ad tech industry is in constant conversation about what this means (spoiler: most people don’t exactly know and first party data really matters), it’s still important to keep updated as new developments arise.

Here’s a check-in on the latest updates regarding alternative cookie solutions.

With cookies depreciating, an alternative is necessary

With the removal of the industry standard for digital tracking, many companies have developed alternative solutions—creating a frenzy of ad tech deals. Leaders have questioned which alternative solution will emerge as the next industry standard.

Right now there are more than 100 alternative identity and contextual solutions coming to market, according to continuing analysis by MMA Global and Prohaska Consulting. Though exciting, this hyperactivity is not sustainable. Buyers and sellers need to have compatible data and technology.

For this reason, ad tech leaders are paying attention to alternative IDs that are gaining the most steam.

The Unified ID 2.0 (UID 2.0), which was originally developed by the Trade Desk, is becoming increasingly prevalent. Advertising companies like Publicis, Omnicom Media Group, LiveRamp, Lotame, IP5, Index Exchange, Magnite, PubMatic, OpenX, SpotX and most recently IPG have signed on in support of the technology.

Companies appreciate the UID 2.0 because it’s transparent, open source under an industry body run by the IAB Tech Lab, and perhaps more importantly, it can be used within a company’s own privacy walls.

In March, the UID 2.0 entered beta in the States and it recently began beta testing in Canada. It’s a key time for publishers, agencies and other businesses to experiment with the technology to see if it’s a good fit.

Xandr builds flexible platform to bring multiple solutions together

While companies seek a new industry leader, flexibility will be key.

Xandr, AT&T's ad platform, announced that it will be accommodating different needs and choices. The digital marketplace will support nearly all future ad IDs, including Unified ID 2.0, LiveRamp’s Authenticated Identity Infrastructure and netID in Europe.

“Xandr has been head’s down evaluating the many ways we can flexibly support our clients on both sides of the marketplace, as we approach the deprecation of third-party cookies and identifiers,” said the company.

Especially after COVID, companies recognize the need to be nimble. With this approach, buyers and sellers will have a common currency even if they choose a different identifier.

What will Google do, or be allowed to do?

Though there are clearer paths forward than there was last year, there are still many looming questions. Google has explicitly stated that it will not work with alternative solutions.

At the same time, Google is under investigation by the U.K.’s Competition and Markets Authority (CMA). It has massive droves of data. By removing the cookie and not supporting alternatives, the company may be found to be abusing its market dominance, breaching competition law.

Google faces similar monopoly lawsuits in the United States, though not tied to the demise of the cookie.

Google is cooperating with the CMA and asking for industry feedback on their Privacy Sandbox initiative.

Many questions still linger, but the mood may be shifting from frustration to a new sense of opportunity. And with some solutions becoming more ubiquitous, like Unified ID 2.0, there may be more clarity about which options companies should experiment with over the next year.