What Google's decision to keep cookies means for the internet

Google on Monday announced a bold move that has some big implications for advertisers and the future of the internet.

The U.S. internet giant said late Monday it is reversing a long-planned move to ditch third-party cookies — the critical text files that track users' web activity for advertisers.

But what are cookies, exactly? And what does Google's decision mean for how you interact with the web moving forward — or, for that matter the advertising industry?

CNBC runs through what you need to know.

Cookies are small pieces of code that websites deliver to a visitor's browser. They remain as the person visits other sites.

These bits of code silently track our online activities, collecting information on what we're searching for and the kinds of products we tend to buy, for example. They have become a key way for advertisers to fine tune how they target people with ads online.

The practice of using third-party cookies to track web activity has helped fuel much of the digital advertising ecosystem and advertisers remain heavily reliant on cookies as a tool to gather data on their customers.

Roughly 40.9% of websites globally use cookies to gather data on users, according to data from W3Techs, a web technology research firm.

"Third-party cookies are the backbone of online behavioral advertising. They are the way that products or brands follow you around online," Matthew Holman, partner at law firm Cripps, told CNBC.

"If you've ever wondered how you can search for a new pair of shoes online only to find the same shoes advertised five minutes later on your favourite social media platform, the answer is: third party cookies."

But cookies aren't only a method of tracking users' browsing habits. They also form a key part of how the modern