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Google is developing one two-hop proxy<\/a> to improve the privacy of Chrome users, which has three major implications for advertisers:<\/p>\n For ad placement targeting, you’ll only have the option to target regions designated by Google, which won’t be precise. Because Google Chrome will use a proxy to connect to websites, it will mask user identities, so advertisers can’t tell the difference between genuine bot traffic. Google is increasing its collection of valuable location data alone, which could increase costs for advertisers.<\/p>\n Why we care <\/strong>The two-hop proxy is only implemented in Chrome, which means that Google will have a monopoly on this data. No other search engine will have data that advertisers can use for location targeting. This could effectively eliminate competition in the search ad space.<\/p>\n What is IP-based geolocation?<\/strong> According to Google’s documentation:<\/p>\n “IP-based geolocation is used by a number of services within third-party proxy traffic to comply with local laws and regulations and deliver relevant content to users. Use cases include content localization, allocation of local cache and geo-targeting of ads.”<\/p>\n The details<\/strong> Users’ IP addresses will be pooled and masked by region, and Google will assign an IP address to each pool. Here’s what it looks like: <\/p>\n Get the daily search newsletter marketers trust.<\/p>\n Any user assigned an IP address for a region will have been verified to be in that region. The Google geofeed<\/a> it will connect to the proxy server and have city-level precision.<\/p>\n Will consumer data really be private? <\/strong>While a consumer’s data will be protected from advertisers, it will not be protected from Google, posing a threat to data privacy.<\/p>\n More privacy concerns and Google’s self-preference.<\/strong> In February, the CMA (Competition and Markets Authority) said:<\/p>\n “We are particularly interested in addressing any remaining concerns about the design of the privacy test tools and ensuring that Google does not use the tools in a way that favors its advertising services.”<\/p>\n Dig deeper. Google “cannot continue disabling third-party cookies”. <\/strong><\/p>\n Meanwhile, the Information Commissioner’s Office, a UK privacy regulator, also shared significant concerns about Privacy Sandbox, in a WSJ article<\/a> (subscription required), published last week. Once published, nothing will stop Google and other companies from using data to track users across sites, the ICO said.<\/p>\n