The news: Google suggested on Monday that it will not phase out third-party cookies from Chrome and will pivot to an opt-in model, signaling a major shift for Privacy Sandbox, its embattled post-cookie solution.

• “Instead of deprecating third-party cookies, we would introduce a new experience in Chrome that lets people make an informed choice that applies across their web browsing, and they’d be able to adjust that choice at any time,” Anthony Chavez, Google’s vice president for Privacy Sandbox wrote in a blog post.
• Chavez writes that feedback from stakeholders, including regulators like the UK’s Competition Markets Authority (CMA), publishers, developers, and the ad industry, has shaped Google’s Privacy Sandbox roadmap.
• He noted that early tests suggest Privacy Sandbox APIs can support a competitive marketplace and improve over time with industry adoption. However, Chavez adds, transitioning will affect the entire digital ecosystem—hence this new approach.
• Chavez writes that Google will continue investing in Privacy Sandbox APIs and plan to introduce IP Protection in Chrome's Incognito mode.

What it could look like: Google’s blog post steered clear of specifics about what tracking method users will be able to opt out of, but it appears to suggest an outcome that allows third-party cookies to remain available on Chrome even if it is no longer the dominant tracking solution.

• The result could be a landscape that mimics what’s taken shape on iOS with AppTrackingTransparency (ATT). Advertisers can still use Apple’s identifier for advertisers (IDFA), but it reaches far fewer users due to ATT’s opt-in pop-up.
• “The extent to which consumers opt out of sharing third-party cookies (if that is what Google is proposing) depends largely on the prominence of the privacy call-to-action,” said EMARKETER senior analyst Evelyn Mitchell-Wolf. “If there’s an ATT-style pop-up, we could easily end up with more consumers defaulting to not sharing their data.”
• Most consumers do not choose to share data when prompted. A 2023 Mobile App Trends report found that iOS apps across categories had a worldwide opt-in rate of 29% as of Q1 2023.

A rocky road: In April, the UK's ICO claimed Privacy Sandbox fails to meet data privacy standards, leading Google to delay the phaseout of third-party cookies on Chrome for a third time. Industry groups and the CMA have also criticized Privacy Sandbox for inadequate data gathering and tracking.

Our take: Even with Google’s new direction, third-party cookies are unlikely to remain the primary tracking method on Chrome; advertisers should still prepare for the post-cookie future.

• Despite concerns about Privacy Sandbox, there is optimism for improvement before the mid-2025 transition deadline. Even before Chavez’s post, Google acknowledged it expects performance to evolve as it made adjustments.