A new study has found that removing cookies has a significant impact on publishers’ profits.
Researchers from the Questrom School of Business, Boston University examined data from an experiment designed by the CMA and Google to evaluate what effect cookies have on publishers’ work as governments continue to introduce more privacy controls in many countries.
The experiment assigned Chrome users to one of three modes: browsing with cookies enabled, browsing without cookies at all, and browsing with cookies deactivated using Google’s Privacy Sandbox.
They found that third-party cookies play ‘a significant role’ in publisher revenue, and that removing them ‘imposes a substantial economic cost’.
According to the paper, removing cookies entirely reduces revenue by 29.1% relative to the status quo, and by 35.3% for the subset of impressions that have third-party cookies. Publisher revenue in the Sandbox condition falls 27.9% relative to the status quo, and the users in this cohort also showed a higher ad latency and a 2.9% reduction in ad impressions.
The paper states that there is a ‘tradeoff between safeguarding user privacy and sustaining the advertising revenue that funds online content, including independent creators and journalists’.
This data does come from a single ad management company, and comes from settings where cookies could only be fully active or fully deactivated. This means that other sites, which have more flexible cookie options, were not assessed and what impact mixed privacy settings have on profits is still not known.