Apple’s MAC Scramble And The Impact On Marketers

apple scram-2Apple caused a stir this week when news broke that the upcoming mobile operating system iOS 8 could deliver a blow to location-based trackers by scrambling the MAC (Media Access Control) address. Despite the name, the MAC address is not Apple-specific.

Apple began restricting access to MAC addresses last September, when its release of iOS 7 removed the ability for applications to grab MAC addresses off devices. This was intended to block usage of the WiFi MAC address as a device identifier, a source told AdExchanger.

Apple’s iOS 8 randomizes MAC address used when the device simply searches for WiFi connections. This means WiFi routers no longer see the actual MAC address until the user connects to the router. This makes it more difficult to consistently identify the same user over time.

Marketers and vendors won’t feel the impact of this shift until the operating system drops this fall, but those who rely on the identifier are concerned. It’s unclear, for instance, how these changes will affect mobile audience and cross-device targeting technologies, such as Drawbridge, which declined to comment.

“The news about iOS 8 scrambling MAC addresses is certainly problematic for the niche industry that has sprouted to deliver real-world analytics to malls, retailers and other physical locations,” said Tim Dunn, director of strategy and mobile at digital agency Isobar. “In the short-term, it’s going to be a tricky period for those who’ve bet the farm on the ability to track users through these techniques.”

Some in the industry addressed the practical impact Apple’s development could have on marketers.

“This latest development will make the ‘Returning Customer’ engagement process more difficult for folks on Apple OS,” said Al Gadbut, president of AcquireWeb, a marketing data technology company that focuses on customer identity integration. “Many financial institutions rely upon the MAC address as a historical point for verification on returning customers to more quickly process customer requests. You can imagine the security headache of not having that key piece of verification data.”

Each customer accessing a financial institution that relies on that identifier essentially “looks like a new person or new device each time,” Gadbut said. “Beyond the financial services space, the MAC address is one of the key data points for device fingerprinting companies such as BlueCava.” (Ed: BlueCava issued a statement to AdExchanger that the company “creates device IDs based on statistical algorithms,” and does not utilize device fingerprinting techniques.)

Not everyone is publicly worried. Mobile ad platform Spotzot’s CEO Pehr Luedtke said the difference between identifiers are subtle. While the change will impact providers who use the MAC address for location tracking (the phone ID), many location-tracking tech companies use GPS or the app identifier itself to determine location.

Euclid Analytics, which provides Web-like analytics to brick and mortar stores by turning WiFi ports into in-store sensors, says it “fully supports” Apple’s decision as it increases privacy safeguards, which will assuage consumer privacy concerns.

“We only collect anonymous device data and have never collected a device’s real, universal address,” the company said in a statement to AdExchanger. “Our approach to delivering insights on attribution, shopper funnels and overall trends has been to scramble the MAC address prior to collection.”

Even companies that had historically tailored their businesses around WiFi, like NinthDecimal (formerly JiWire), aren’t sounding too many alarms.

“The iOS 8 change doesn’t impact companies like us, as the MAC address isn’t the identifier that is used to build audiences regardless of whether the device connection is WiFi or 3G (the app identifiers are what is used, which is IDFA on iOS),” said Mark Dixon, SVP of product management for NinthDecimal. “The update may have some benefit to Apple for converting Android users. I also wouldn’t be surprised if Android follows this approach in turn as a result.”

Isobar’s Dunn agreed Google’s response will be telling.

“It could be argued that if Google’s ambition is to measure and monetize all aspects of digital behavior, then this is a very important identifier that delivers seamless messaging from online to out-of-home to retail,” he said. “Therefore, they would want to make this identifier as available as possible to their technologies and clients.”

He added, “Google’s response to this move will be revelatory as to whether they are really interested in real-world analytics, and how they will integrate it into their future targeting products.”

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1 Comment

  1. president of AcquireWeb: Many financial institutions rely upon the MAC address as a historical point for verification on returning customers to more quickly process customer requests.

    Um, what? Unless they happen to be on the same physical network as the bank they won’t get the MAC address. When I’m access any website from home they won’t know my MAC address.