A study published earlier this year by the European Commission, and conducted on its behalf by AWO, found numerous negative impacts of the digital advertising market on advertisers, publishers, users and society.
For example, disinformation websites are funded through digital ads, harming democracy and diverting revenues from legitimate publishers. Furthermore, the market's complexity and lack of transparency prevent advertisers from ensuring their ads aren't placed next to content that may hurt their reputation. This problem, like others, stems from the market's reliance on personal data and tracking to deliver ads and measure their performance.
The study argues that simplifying the enforcement of existing privacy laws could help remedy these problems by reducing the market's reliance on personal data. This would involve targeting key points in the data supply chain, to reduce the amount of work needed to make privacy law as effective as possible.
AWO proposed establishing a "single interface" for users to control their digital advertising preferences. This proposal has attracted considerable interest, as it would create a paradigm shift in the digital ads market, radically changing it for the better. Indeed, the idea is being explored by industry and the European Commission as part of its Cookie Pledge.
What is the single interface?
Section 8.3 of the AWO study suggests the European Commission work to establish "a single interface where individuals can easily indicate their preferences for data collection and targeting across the entire digital advertising ecosystem."
Through such an interface, users could:
- Select the types of ads they want to receive on all sites, platforms and apps.
- Switch off targeted ads all together (a legally enforceable "Do Not Track" signal).
- Include publishers they trust with their personal data on an inclusion list.
Using data for targeting and evaluating ad performance would still be possible, but it would be based on trust and a less intrusive approach that minimizes the processing of personal data.
The opportunity
First, the single interface would give users more control over their personal data than any other technological or legal solution could. It would automate, centralize and universalize user choices across the market, eliminating the need to deal with countless consent banners and ad settings. Lowering this burden on users is crucial given "cookie fatigue" and users' varying levels of digital literacy. It would also increase consumer empowerment beyond the gains in transparency expected from the Digital Services Act.
Second, the single interface would simplify the exercise of data protection rights. Instead of individually checking the legal compliance of thousands of companies' use of data, data protection authorities could use conformity with the signals of the single interface as a proxy. It would expedite both compliance and enforcement by regulating the market from the bottom up, rather than from the top down.
Third, the single interface would cause a paradigm shift in the digital advertising industry. Currently, by default, companies in the industry can gather as much personal data as they see fit based on their interpretation of privacy legislation. Through the single interface, data collection would be prevented by default, unless users agree to share it. This would significantly curb profiling and tracking, reducing companies' ability to rely on personal data to power their digital advertising services. It would institutionalize the EU General Data Protection Regulation's principles of privacy by design and by default, ending the era of indifference to legal norms by ensuring companies' autonomy does not override that of users.
This would significantly reduce the importance of personal data as a resource in digital advertising, leading companies to look for alternatives. Companies would reallocate resources toward solutions that rely on little to no personal data, such as contextual advertising, increasing the latter's effectiveness and uptake.
Fourth, the single interface would mitigate the market's negative societal impacts. At present, tracking allows websites hosting disinformation to generate higher revenues by demonstrating they have presented ads to "high value users," such as those who have visited a car company's website and may therefore be in the market to buy a car. Blocking tracking by default would restrict disinformation website's access to this type of information, reducing revenues. Curbing tracking would also reduce its climate impact, make it more difficult to manipulate users and reduce state agents' and criminals' ability to spy on users.
Finally, through the "Brussels effect," the single interface could set an example for regulating the digital economy, strengthening the EU's leadership in this area. It would set an innovative standard for data governance that could inspire other jurisdictions to build upon. It would also set a standard for user control that could be applied in other sectors, like internet of things and recommender systems.
The challenge
Establishing the single interface won't be without its challenges. It is a project that should, therefore, be considered carefully and informed by academic research and stakeholder input.
One of the biggest challenges is governance. Who will manage and design the single interface, when an entity in control could abuse its power as a gatekeeper over users' data to its benefit? For example, a browser operator could manipulate the design of the single interface to allow the collection of more personal data than its customers (e.g. publishers) and competitors, thereby comparatively increasing the attractiveness of its services. This problem was highlighted by discussions around the ePrivacy Regulation's Article 10 on browser-based consent, as well as the U.K. Competition and Markets Authority's investigation into Google's "Privacy Sandbox" browser changes.
Governance concerns could be tackled through a co-regulatory working group including EU policymakers, relevant industry segments — such as platforms, advertising technology intermediaries, advertisers, publishers — and civil society. Also, as a common and uniform interface, such as an application programming interface, it could be accessed through browsers, operating systems and even app stores. With no single entity in control, the single interface would meet its objectives without favoring any particular market segment.
Creating an interoperable interface that can be accessed by all relevant market participants would be technically complex. One solution is to build upon a system already in development, the proposed European Digital ID. Similar to the single interface, the eID Regulation would establish a framework to automate the secure communication of user data based on their preferences, and only to the extent required, for example, to use banking services or file taxes. The eID framework could be a stepping stone toward the single interface.
Additionally, although the initial work of establishing the single interface will be demanding, adapting it over time based on market innovation should be relatively easier. This would make it significantly more flexible and future proof than laws such as the EU GDPR and the DSA.
The single interface would also need to ensure companies generating revenues from digital ads, particularly publishers, can still contact their users directly. If users turn off the use of personal data for digital ads by default, publishers should still be able to present them with reasons to opt in, for instance, because access to ad performance data can help them generate higher revenues. When prompted to do so, users would be able to inclusion-list the publishers they trust and want to support. This would not take the form of a "cookie wall," restricting access to users that do not inclusion-list the publisher in question, as it would defeat the point of the interface.
Finally, the language used by the single interface and its design will determine users' ability to understand it. It should give users simple and direct access to the most privacy-friendly options, and more in-depth granular options, like allowing the use of only some categories of their personal data or only for some purposes. User-friendly design and language are, therefore, crucial.
The way forward
The single interface is a comprehensive solution that would bring about a paradigm shift in the digital advertising market. Establishing the single interface — and getting it right — is worthwhile because of its ability to make the market more balanced, privacy-friendly and sustainable.
