Eight Mobile Ad Companies Get Behind ODIN In A Quest To Replace The UDID

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More than a half-dozen mobile ad companies are getting behind a working group called ODIN to find a new way of tracking and identifying iOS users that still respects their privacy. This is happening because Apple is pressuring developers to stop using an older method called UDIDs (or unique device ID numbers) faster than previously thought amid criticism that it compromises privacy.

Velti, Jumptap, RadiumOne, Mdotm, StrikeAd, Smaato, Adfonic and SAY Media are hoping that by collaborating, they can influence the new standard that the rest of the mobile advertising industry will adopt.

“We need to get everybody on the same page so that we have a uniform solution that ends up working for everyone,” said Krishna Subramanian, who is Velti’s chief marketing officer.

The old way, the UDID, was a unique identifier specific to every single iPhone, iPad and iPod. But critics have said that UDIDs are sensitive because they can’t be cleared or erased.

So the industry is scrambling to converge on a decent alternative right now. I surveyed a bunch of alternatives last week and covered their weaknesses and strengths.

If the mobile advertising industry and developers don’t find an alternative soon, it could become much harder to run targeted advertising campaigns and revenues could decline for many app makers.

ODIN says that about 60 percent of mobile ad revenue comes from this type of performance-based advertising. If you factor in cost-per-install or cost-per-action campaigns, which are based on when a consumer downloads an app or takes an action in an app, ODIN says that the app ecosystem could miss out on about $2.6 to $3 million dollars per day in ad revenue.

ODIN has proposed one alternative right now, but that could change if Apple doesn’t like it. Right now, ODIN derives an ID from a phone’s MAC address (or media access control address). It’s the address that’s used to connect to Wi-fi networks.

ODIN hashes or assigns a secure key to the number so that privacy is maintained. “It is ‘computationally impossible’ for the original ODIN to be traced back to the hashed ODIN, meaning it cannot be reversed to connect targeting or installation information to a particular user,” the group said in a statement.

The issue though is that many other developers don’t think that Apple will tolerate use of MAC addresses as an ID for much longer. Jim Payne, who is the chief executive of Mopub, told us last week that: “The MAC Address is terrible. Your phone is constantly broadcasting your MAC Address to find Wi-fi networks. It’s literally being broadcast while you walk around. So it’s got all the same problems at UDID, plus this other huge problem.”

But because ODIN doesn’t use the raw MAC address as the identifier, maybe Apple will be OK with it.

“From our standpoint, we felt that this would be the most accurate for a given time period,” Subramanian said.