Global Moves on Targeted Advertising
Last week Google announced that it will be introducing privacy measures on its Android operating system to limit tracking across apps.
In what appears to be a key point of difference from Apple’s new privacy system (which Meta predicts will cost it $10b in lost ad sales revenue in 2022), Google’s Privacy Sandbox for Android will be phased in over two years to give Google time to work with stakeholders to design a privacy-safe alternative for advertisers that does not rely on device-level identifiers.
This move is just another nail in the third-party data coffin.
As we have seen both in Australia and at a global level, governments and consumers are increasingly focussed on data and privacy issues.
So, what do you need to know and how is the AANA responding in Australia?
These moves will directly impact targeted advertising by introducing new statutory regulations. Actions by the digital platforms may have an impact on how new regulations play out but will not change the overall direction of policy making which is towards first-party data.
US, EU, and UK developments
In January, the US Democrats in Congress introduced a bill which would prohibit all targeted advertising, except for contextual advertising (advertising matched to what the user is viewing) and broad-based locational targeted advertising based on the user’s State, city or postcode.
If you are wondering what bought this on, legislators have made it plain by calling it the “Banning Surveillance Advertising Act of 2022” (BSAA). Essentially legislators are concerned that the US advertising industry is out of control and out of step with users’ expectations of privacy.
Two days later, the European Parliament announced its intention to push for a ban of targeted advertising to minors using their personal data and a broader ban on targeted advertising using sensitive personal data which can then be misused to target vulnerable groups.
This announcement is part of the European Parliament’s development of a Digital Services Act (DSA) to introduce rules for online platforms to tackle illegal content and promote online advertising transparency.
Neither proposal is likely to succeed in its current form, however it’s clear that US and EU legislators are taking a closer look at the digital advertising industry and they don’t necessarily like what they see.
Two years earlier, the U.K.’s data protection regulator, the Information Commissioner’s Office (ICO), issued a report claiming the online behavioural advertising industry was illegally profiling internet users in breach of UK privacy laws. While there’s been no action so far, the outgoing information commissioner, Elizabeth Denham, recently issued an official opinion calling on the industry to proactively move away from current online tracking and profiling practices.
Australian policy direction
In Australia, the Attorney-General’s Department released in October a long-awaited Discussion Paper as part of its review into the Privacy Act 1988, and at the same time released an Exposure Draft of an Online Privacy Bill. The documents have worthy goals of protecting children when online and providing all Australians with increased control and transparency around the use of their data.
In line with global concerns, the Privacy Act Discussion Paper contains proposals to treat any location data as sensitive information which would thereby require explicit opt-in consent for collection and use. The Online Privacy Bill contains requirements to obtain consumer consent in a way that is clearer and more transparent and restricts the ability to share data with third parties.
AANA’s response
AANA’s submissions stress the importance of general location data (i.e. area or postcode) in order to serve relevant advertising and the need to allow targeted advertising in a privacy-safe way.
The AANA has also argued that the proposed privacy changes may risk consent fatigue as has happened in the EU, and any new privacy restrictions should not hamper an advertiser’s ability to track and audit their digital advertising spend to ensure they get what they pay for.
Google’s phased-in approach for their Privacy Sandbox solution demonstrates that, despite global calls for increased privacy protection and more transparent processes for gathering user data, forging a way forward is not so easy when one considers the competing goals which governments and regulators are trying to achieve:
- They want privacy for users but also a way for advertisers to track and audit their advertising spend.
- They want clear, transparent user consent prior to any data collection, however they also want highly competitive digital markets where platforms are less siloed and unable to keep their user data all to themselves, and
- They want users to have the right to anonymity, but they also want child users identified and shielded from inappropriate content or advertising.
Add to this the fact that users quite like having access to free stuff online and the free stuff is often funded by advertising.
In countries such as the EU where strict data collection laws have been introduced, even the regulators had to acknowledge that many users found the cookie consent banners annoying and simply clicked “accept” to get rid of them. This led the EU to revise its cookie consent policy to reduce the number of consent prompts and allow users access to content even if they refuse to be tracked.
The global shift is towards first-party data and building an in-house understanding of your customer. The AANA has pointed out the potential competition issues associated with such a move away from third-party data, whereby companies with detailed customer databases will have a distinct advantage when it comes to sales and marketing.
The AANA will continue to engage with digital platforms, government and advertisers to advance thinking on these issues and advocate for responsible targeted advertising that aligns with the community’s expectations on privacy.
And as we approach a Federal election and the anticipation of receiving more texts from Craig Kelly, readers may be pleased to know that the Privacy Act review is questioning why political advertising should continue to enjoy an exemption from privacy rules. It is unlikely that politicians will rush through legislation that would limit their ability to target voters however one must ask whether online advertising for holidays or chocolate should be more tightly regulated than advertising which may ultimately influence who runs the country.
If you have any questions, please get in touch with Megan McEwin, Director of Policy and Regulatory Affairs.