The status quo in digital advertising is “unsustainable”, according to a new study by data rights agency AWO.
The research, conducted on behalf of the European Commission, suggested a ban on Big Tech companies collecting personal data for advertising purposes.
The report, titled ‘Towards a more transparent, balanced and sustainable digital advertising ecosystem: Study on the impact of recent developments in digital advertising on privacy, publishers and advertisers’, suggests a case to reform the industry, citing issues for publishers, consumer privacy and the environment.
Key findings include:
Beliefs about personal data increasing the value of digital advertising are ‘largely unsubstantiated’, due to an absence of testing around alternative models.
These assumptions are shown to strengthen the position of the largest data controllers (Big Tech companies) at the expense of advertisers and publishers,
This creates an “accountability crisis”, where individuals are forced to contend with a “complex web of companies” if they want a say in how their data is used.
While the largest European publishers’ revenues have stagnated over the past decade, Google and Meta’s have increased by more than 500&%
This is because “large platforms have more access to data than they do.”
“There is little independent evidence to support claims that the use of extensive tracking and profiling yields a significant advantage compared to digital advertising models which don’t do this,” argues the report.
A single consent form for all platforms?
AWO proposes that “gatekeepers” (such as Google and Meta) are banned from tracking users for digital advertising purposes, due to the imbalance between the company and the data subject.
“This may be evidenced in take-it-or-leave-it data policies which are frequently changed by the gatekeeper,” notes the report. “It would therefore be helpful to consider whether it is ever appropriate for gatekeepers in the digital advertising ecosystem to use consent as a legal basis to collect and process personal data for advertising purposes.”
The report also recommends the EU promote a single interface where individuals can indicate their preferences for how their data is used across the entire ecosystem.
“Users have a limited ability to control or influence how their personal data is used in digital advertising,” tweeted the report’s co-author Nick Botton, Senior Policy Associate at AWO. “Ad preferences tools such as Google and Facebook’s ad settings and Your Online Choices are difficult to access, hard to comprehend and difficult to use.”
Read his full Twitter thread here:
The study on digital advertising conducted by AWO on behalf of @EU_Commission was published today! Here’s a quick thread on its key findings. https://t.co/tnTsTPqd31
— Nick Botton (@NickBotton) January 31, 2023
“Apple’s App Tracking Transparency is already showing us how this could work in practice”
The 274 page report looks at consent and how it’s handled - one striking recommendation is for a single user interface ‘for data collection and targeting across the ecosystem.’
Niall Moody, Chief Revenue Officer at Nano Interactive with a decade plus of AdTech experience, says this is easier said than done and the devil is in the detail.
“In the area of consent, the battle lines are still being drawn. Creating a single data interface for data collection and targeting, as the study suggests, will be easier said than done based on the current situation with the Belgian DPA and IAB Europe’s TCF,” Moody said.
Moody believes that while an alternative to people/cookie-based targeting is needed, tech giants like Google should not be deciding and owning how that works - as we’ve seen from the reaction to Topics. Instead, maybe consent and privacy decisions should be at browser level - and the only viable way forward - as Apple has already shown.
“To make this happen, it seems to me that browsers owning consent is currently the only viable solution. It might sound counterintuitive to put extra power in hands of tech giants, but we need to be pragmatic. We need a robust solution across the whole industry putting consent first at all costs.”
“And given the complexity of the market, the most practical option is for this to be handled by the gatekeepers. Apple’s App Tracking Transparency is already showing us how this could work in practice, being user friendly, understandable, and actually working. Ultimately, so long as advertising is viewed, as opaque, overly complex and non-compliant, by populations and governments alike, we all lose,” Moddy concluded.
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