Over 30 civil society groups, privacy-friendly technology companies, and European startups are mounting a last-ditch effort to persuade EU legislators to impose more muscular limitations on surveillance advertising as a critical vote on an update to the bloc’s digital regulations approaches.
The European Parliament will vote shortly to confirm its negotiating position on the Digital Services Act (DSA), and the 30 signatories to the joint statement on “surveillance-based advertising” are urging MEPs to support amendments to the DSA that tighten the rules on how people’s data can be used for targeting advertisements. The European Parliament will vote shortly to confirm its negotiating position on the Digital Services Act (DSA).
It boils down to this: The group argues that inferred personal data (also known as data that a platform can learn or guess about you by snooping on your digital activity) should not be used to target advertisements and that only information voluntarily provided to advertisers by the individuals in question should be used for targeted advertising.
For example, a platform could ask users to select a few categories of goods or interests for which they’re happy to receive marketing regularly offers — such as beauty products, hiking/outdoor gear, vacations, or culture/art — and then ask them to confirm their selections periodically through an email.
They would only be allowed to utilize such signals for ad targeting, which would make it more contextual rather than creepy, in this case.
This isn’t such a far-fetched idea as it seems.
In reality, regulators in the area have been warning for years that tracking-based advertisements are operating on borrowed time due to widespread violations of EU privacy regulations. However, simple regulatory action against tech has been more challenging to come through.
In a recent statement, the outgoing data protection commissioner of the United Kingdom called on the industry to reform — and move away from the current paradigm of tracking and profiling — and stated that the future must be about giving Internet users genuine choice over how they are targeted with marketing messages.
In a declaration urging legislators to support ad targeting reform, the signatories claim that it would have many advantages, including reducing difficulties related to covert monitoring of online users, leading to abusive advertisements that manipulate and exploit.
The theories of harm associated with microtargeted advertisements have received a great deal of attention in recent years, with risks of behavioral targeting being linked to discrimination, exploitation of vulnerable people/groups, and democracy-denting election interference, to name a few examples of what has been discussed.
The issue with surveillance advertising is that it cannot be held accountable in the public arena since it lacks absolute transparency.
However, alternative targeting methods do not involve invasive eavesdropping and behavioral profiling.
As the signatories write, “we are convinced of the efficacy and respect for users’ choice and privacy (i.e., without the use of covert surveillance practices) that targeted digital advertisements can provide, provided that only data specifically provided by users for that purpose is processed, in a transparent and accountable manner.”
According to the statement, it is time to put an end to the use of “inferred data,” which “reveals users’ vulnerabilities and, by definition, is collected or generated without their awareness and control,” according to the statement. “This practice causes significant harm on an individual and societal level, as evidenced by extensive academic research and recent revelations such as the Facebook Files and whistleblower Frances Haugen’s revealing report,” it continues.
The authors argue that companies that engage in digital advertising have a vested interest in respecting their customers’ choice, autonomy, and expressed (as opposed to inferred) preferences. They cite survey results that found that 75 percent of social media users in France and Germany are uncomfortable when their behavioral data targets them with advertisements.
The authors go on to say that although small and medium-sized enterprises lawfully utilize internet advertising to reach their customers, they do not need to depend on invasive monitoring as a method of accomplishing this goal.
According to the statement, the biggest benefactors of contemporary adtech’s “surveillance free-for-all” — and the widespread, covert, mass monitoring of Internet users — are expected to be US technology giants, namely Google and Facebook.
In contrast, progressive European businesses — who have been working for years to establish alternative, privacy-preserving advertising targeting methods — are being hampered in their efforts to compete due to the rights-violating data practices of US corporations.
The statement argues that user vulnerabilities and cross-site tracking are only exploited by large online platforms based in the United States, which are interested in maintaining their dominant position in the digital advertising market. It calls for creating “regulatory incentives” to allow “progressive” privacy-focused startups to scale their rights-respecting services and make them more accessible to small businesses.
In addition to strengthening small European businesses and GDPR [General Data Protection Regulation] compliant digital services, as well as local media, putting a stop to the most intrusive tactics “would foster fair competition in digital advertising and restore the power of quality.”
It’s an argument that, in principle, should resonate with Europeans who have been elected to represent them in the European Parliament.
Recent years, however, have seen a significant increase in the amount of money that US internet firms — led by Google and Facebook — are putting into lobbying efforts in Brussels in an attempt to sway politicians away from measures that may harm their surveillance-based business models. As a result, this is by no means a fair contest.
One of the most prominent allegations made by the internet giants in their lobbying efforts has been the assertion that stronger targeting regulations would harm Europe’s small companies. Indeed, Facebook (now Meta) has gone so far as to suggest that outlawing surveillance advertisements will have a devastating effect on the economy of the European Union.
But, of course, they’d say something like that, wouldn’t they…
The Panopticon Foundation, Access Now, Alliance4Europe, Amnesty International, Article 19, Bits of Freedom, Civil Liberties Union for Europe (Liberties), Defend Democracy, Fair Vote, Global Witness, Irish Council for Civil Liberties, #jesuisla, The Norwegian Consumer Council, Ranking Digital Rights (RDR), The Signals Network, SumOfUs, and Uplift are among the civil society organizations that have signed the joint statement.
Although many MEPs attempted to have an explicit prohibition on surveillance-based ad targeting included in the DSA at the end of last year, their efforts were ultimately unsuccessful.
In another draft package of EU legislation, known as the Digital Markets Act (DMA), a parliamentary committee supported tightening restrictions on tracking-based advertising by beefing up consent requirements for advertising targeting and adding a complete prohibition on behavioral targeting of minors. This legislation will apply to the most powerful Internet gatekeepers (including many US giants) and apply to all of Europe’s member states.
Nonetheless, the 31 signatories of today’s statement contend that the current IMCO compromise is insufficiently restrictive of the data industrial surveillance complex and urge members of the European Parliament to support plenary amendments to Article 24 of the DSA that “go beyond the existing IMCO compromise and rule out surveillance practices in digital advertising — such as the use of inferred data — while supporting users’ genuine choice.”
A lawyer and policy analyst for the Panoptykon Foundation, Karolina Iwaska, told us that the IMCO committee’s agreement on advertisements was “fragile and essentially sustaining the existing quo.” She also noted that “Big tech’s “SME” lobbying was quite effective.”
The anti-surveillance campaigners are now hoping to persuade MEPs to support reform of personalized ads by limiting targeting to expressed preferences — which they believe will give Internet users “genuine control,” she said. “We believe that a true compromise between a full ban on the use of personal data (unrealistic at this point) and the status quo (everything allowed if consent is collected) is possible — but has sadly been ignored in the parliament,” she added.
If the endeavor accomplishes its goal, it will have to move at breakneck speed.
According to Alaska, the activists have developed an amendment — but they have not yet received enough support from MEPs to present it to the parliament as a whole so that the entire parliament may vote on it in a plenary session. The following several days will be critical in the success of this campaign.
Co-legislative processes in the EU begin with a proposal from the Commission followed by broader negotiations between the Member States and the European Parliament on the policy details — with the possibility that upcoming EU rules will be reworked reshaped before they are finally adopted.
The Digital Single Market Act (DSA) and the Digital Market Act (DMA) were both proposed by the European Commission at the end of 2020, with the DSA aiming to update the bloc’s e-commerce rules and increase accountability on digital businesses by expanding requirements to define areas of additional responsibility around content.
While the DMA targets the market dominance of Internet companies, which can kill competition and harm consumers, it also has a system of ex-ante restrictions in place to prevent abusive conduct.
After the parliament affirms its stance on the DSA in next week’s plenary session, trialogue discussions on the DSA are expected to begin shortly. In the end, a second total vote in the parliament will be required on the legislation’s final language. Therefore, activists opposing surveillance advertising may influence the process at other stages if they are persistent.
Regardless of the outcome, one thing is sure: lobbying will continue throughout the year.
Any limitations on ad targeting in the EU will still have to wait for the legislation to be ratified and put into effect — with EU legislators planning to provide digital firms a grace period to bring their operations into line — before they can be implemented. As a result, any regulation modifications will not effect for many months.
While the DMA, which seems to be progressing relatively fast through the co-legislative process, might be up and running relatively soon, potentially as early as 2023, the DSA appears to be more likely to take longer, perhaps as late as 2024, before it becomes effective.