“Data-Driven Thinking” is written by members of the media community and contains fresh ideas on the digital revolution in media.
Today’s column is written by Mathieu Roche, co-founder and CEO at ID5.
US officials have made recent moves that could transform targeted advertising.
The Competition and Transparency in Digital Advertising Act, the American Data Privacy and Protection Act and efforts to change Google’s and Apple’s mobile advertising practices would have significant effects on publishers’ and advertisers’ access to consumer data. These data initiatives would force companies to adopt new practices and technologies to understand and act on consumer identity.
A divided Congress is likely to decelerate potential federal legislation. But there’s bipartisan interest in data media and privacy reform. And even if these initiatives do not pass immediately, they reflect where the regulatory environment is headed.
Let’s dive into each initiative and its implications.
The end of walled gardens?
In May, the US Senate introduced the Competition and Transparency in Digital Advertising Act (CTDA). The focus of this legislation is to eliminate conflicts of interest by prohibiting the largest ad tech companies from participating in certain roles (for example, as both a demand-side platform and sell-side platform) in the ecosystem.
Tech giants that sell ad space and/or run an ad exchange would no longer be able to act as a broker for buyers of ad space. This would mostly affect Google, which would no longer be able to favor themselves when placing ad buys.
ADPPA – America’s would-be GDPR
In July, the House Energy and Commerce Committee voted on the bipartisan American Data Privacy and Protection Act 53-2. As it stands, the bill has not received a full House vote and is facing headwinds. If passed, however, the bill would implement new protections for consumers and expand their control over how their personal information is used.
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Specifically, it would require companies to give users the right to opt out of targeted advertising. The draft ADPPA would also direct the FTC to create a standard for a universal opt-out mechanism, including via global privacy signals, that companies would be required to honor. That means users could decline all targeted advertising in one click.
Additionally, the ADPPA focuses on such core GDPR concepts as data minimization and “purpose limitation.” It includes a provision that would allow companies to collect and use data only if necessary for one of 17 permitted purposes – actions like authenticating users, preventing fraud and completing transactions.
The Association of National Advertisers opposes the bill, as does the Interactive Advertising Bureau.
Mobile ID’s days numbered?
Like the third-party cookie, the mobile ID may also be on its way out. Three Democratic US Senators, joined by a member of the House, requested the Federal Trade Commission to investigate whether Apple and Google have engaged in unfair and deceptive practices with respect to the collection and sale of mobile phone users’ personal information.
In the letter to the FTC, those Congressional Democrats said mobile gatekeepers “knowingly facilitated these harmful practices” by building advertising-specific tracking IDs into their mobile operating systems.
This could be a catalyst for Google’s mobile GAID identifier to follow the path of Apple’s IDFA.
The future of identity resolution
Each of these developments, if enacted, would challenge the methods the industry has used to collect data for identifying and targeting consumers.
But that doesn’t mean addressable and measurable advertising will go away. Advertising is the business model that makes content and services available for free to people on the internet. By setting up the infrastructure to identify consumers and collect and share their data securely with their permission, the industry can continue to use data. With the right safety and consent parameters, data can continue to create value for marketers and pay for the content and services people want to use.
In fact, the industry should welcome a federal law to create a standard data protection framework instead of a patchwork of state regulations. Plus, with legislators targeting ad tech giants, the market can come together to foster a more equitable ecosystem.
These are bars that have been rising for years and that the digital media industry is more than capable of meeting.
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