The Privacy Sandbox initiative, which aimed to create privacy-preserving alternatives for targeted advertising, faced widespread criticism for potentially enhancing Google's dominance in the online advertising market.

Critics have raised concerns that the Privacy Sandbox could harm advertisers and violate privacy laws, prompting advocacy groups like the Electronic Frontier Foundation to urge users to opt out of the program.

As part of its ongoing efforts to enhance user privacy, Google plans to introduce an IP Protection feature in Chrome's Incognito mode, set to launch in the third quarter of 2025.

Industry feedback indicated that proposed replacements for third-party cookies lacked scalability and real-time processing capabilities, raising fears of revenue loss among publishers.

Technical challenges during the testing of Privacy Sandbox alternatives, along with concerns about on-device processing affecting performance, also contributed to this decision.

Anand Kashyap, CEO of Fortanix, noted that Google's changes suggest a preference for a closed ecosystem that primarily benefits its business interests.

This decision was influenced by diverse perspectives from publishers, developers, regulators, and the advertising sector, leading to the conclusion that a new prompt for third-party cookies would not be created.

In a significant reversal, Google has decided to halt its plan to phase out third-party cookies in Chrome, a move that reflects the complexities of balancing user privacy with the needs of the advertising industry.

Anthony Chavez, vice president for the Privacy Sandbox initiative, emphasized that users can still manage their cookie preferences through Chrome's Privacy and Security Settings.

The announcement comes amid heightened regulatory scrutiny of Google, particularly following a recent U.S. court ruling that found the company holds illegal monopolies in online advertising technology.

This new feature aims to protect users' online identities from tracking while using Incognito mode, which already blocks third-party cookies by default.

Despite the abandonment of the cookie phase-out, the change has been positively received by online advertising companies, who continue to rely heavily on third-party cookies for targeted advertising.