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Consumer Federation calls in detailed report for ban on “surveillance” advertising, citing privacy, discrimination, ID theft
Backed by eight narrative fact sheets full of links and citations — a diagram (above), and a detailed breakdown of the inner workings of ad-tech — the Consumer Federation of America (CFA) this week issued a call for banning what it called “surveillance advertising” based on its alleged contribution to discrimination, manipulation, privacy violations and identity theft.
The non-profit CFA said Aug. 26 that the fact sheets are “intended to help policymakers, advocates and the general public understand how surveillance advertising works, how tracking is done, how discrimnation and other adverse impacts may occur, who really benefits, and why contextual advertising is a good alternative.”
Contextual advertising – placing advertisements based on characteristics of the content of a webpage a user is currently browsing – does not require any tracking of individual users, CFA writes on one fact sheet. It says a recent study found contextual advertising to be more cost-effective than targeted advertising. Contextual advertising can also provide more revenue for publishers. Much of the cost of surveillance advertising goes to the various middlemen in the ad tech industry.
“The failure to establish a legal framework to protect privacy in the United States has gnve rise to a vast commercial surveillance infrastructure that doesn’t necessarily operate in the best interests of consumers or small businesses,”, Susan Grant, CFA’s consumer protection and privacy director, said in a statement. “Because the risks of surveillance advertising outweigh the benefits, CFA and many other consumer, privacy and civil-rights groups have called for it to be banned.”
On another fact sheet, CFA says surveillance advertising is increasingly unpopular with consumers, which may ultimately harm business reputations. CFA says a 2021 survey found that 81 percent of Americans would rather keep their personal data private, even if it meant seeing less relevant ads, and a 2019 survey by Pew Research Center found that 79 percent of Americans are concerned about how their data is collected and used by companies.
AD TECH
WASHINGTON WATCH
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Facebook advances “Ad Topic Hints” browser in-browser ad personalization/targeting proposal after initial W3C community feedback
A Facebook proposal to put consumers in control of signaling their advertising interests through the web browser is advancing following feedback from its July unveiling (third item). The proposal, “Ad Topic Hints” would replace the current system of having user interests inferred for targetted by ad networks opaquely sharing “cookie” data.
“Thanks for all the commentary and feedback on the proposal,” Facebook engineer Benjamin Savage told 60 participants in a World Wide Web Consortium’s (W3C) Privacy Community Group virtual meeting this week (according to public minutes). “We have put up the first version of an actual document.”
In a short discussion, Apple WebKit engineer John Wilander asked if the interest preferences loaded by a user to the web browser would then be shared among all websites the user desires, or only to the single website initiating the query. Wilander’s implied inference: Could Facebook use “Ad Topic Hints” for its own purposes and block use by other advertising services?
“I think it makes sense to indicate this will change your ads everywhere, the way we have designed it,” the minutes paraphrase Savage as saying. “So it can only affect one site if the user wants to, or the site can call the API to pull up the confirmation dialog so that it affects all sites.”
Another group participant expressed concern that users would find it confusing to understand how their ad-preference signals would be used, and if the system was not broadly adopted, they might not bother to provide any interest signals. Facebook’s Savage said he would reply to the concerns for another meeting. He has said his key focus is to design a service that could not function as a “persistent identifier.”
The W3C privacy group is struggling with several proposals that would allow the continuation of cross-site logins — so-called federated Single Sign On — when browsers all block third-party cookies. The challenge faced is how to permit “sanctioned” cross-site “state” while not enabling the same sort of opaque tracking scorned by privacy advocates and, now, most browser makers. The solutions are complicated and preliminary. Google’s ideas are things such as First Party Sets and CHIPS. Apple has Storage Access API. Meanwhile, leaders of the ad-tech industry have come up with things like Unified ID 2.0 and SWAN.
IDENTITY
PERSONAL PRIVACY
PRIVACY BUSINESS
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ANTITRUST AND PRIVACY
Apple cuts its take in half to 15% for some games and news subscriptions; allows off-store sales; also settles antitrust case
In moves that could ease antitrust-enforcement pressure on the company, Apple Computer on Thursday simultaneously said it was moving to settle a key lawsuit over rules and pricing of the Apple Store, and also announced a initiative which it said was aimed at helping local news and journalism. Apple’s announcements of course made no mention of antitrust implications.
For a decade or more, news publishers have complained that Apple would not permit them to sell subscriptions within Apple services without using Apple payment services and paying a 30% commission to Apple. Now, Apple says that commission will drop in some cases to 15%, and publishers — news and games — can promote non-Apple subscription services via email.
APPLE AND PRIVACY
ANTITRUST AND PRIVACY
PUBLISHING
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Advertiser control, hoarding of user data hurts consumers, Cornell researchers say; might Google FLoC approach help?
The programmatic, cookie-based advertising system on the web is bad for consumers and great for advertisers, and moves by Google and Apple to change it would benefit the public, three business-school professors at Cornell University have written in an academic paper, “Online Advertising, Data Sharing and Consumer Control.” | (See QUOTE OF THE WEEK, below, for excerpts)
“We show that giving consumers property rights over their own data can improve outcomes; this happens when consumers can directly share data about their browsing history with ad exchanges,” says the footnoted, 42-page paper by Justin P Johnson, Thomas Jungbauer and Marcel Preuss. “On the other hand, simpler consumer data rights, such as the right not to be tracked, can actually harm consumers due to how ad exchanges respond.”
Using mathematical formulas and hypothetical scenarios, the trio say Google’s in-browser “FLoC” cohort system would benefit consumers because it would take away from advertisers the power the now have to refuse to share what they learn about purchase intentions of consumers. In effect, they say, consumers should be allowed to signal purchase intent to competing sellers in the market to get better prices and offers. The third-party racking system “grants excessive data-property rights to advertisers,” they write.
The full paper, dated Aug. 3, can be downloaded from here: DOWNLOAD PAPER. Laurie Sullivan, of MediaPost.com, wrote about it this week, under the headline: Cornell researchers’ paper argues for giving consumers data control.
STATEHOUSE WATCH
EU AND UK PRIVACY
CHINA AND PRIVACY
GLOBAL PRIVACY
UPCOMING EVENTS
- WEBINAR: How to Get and Use First Party Data | Aug. 31, AdMonsters/OpenX
- WEBINAR: Audience Connect: Balancing privacy, personalization and safety | Sept. 15, IAB
- WEBINAR: Addressability Solutions Roadshow w/Tony Katsur | Sept. 16, IAB Tech Lab
- WEBINAR: Privacy Security Forum | Jennifer Urban keynote | Sept. 30, TeachPrivacy/Daniel Solovy
- SYMPOSIUM: “Applications of Contextual Integrity”, Sept. 30-Oct. 1, Privacy.io
- WEBINAR: “Yes We Trust Summit”, Oct. 7, Didomi.io
- CONFERENCE: Next Generation Privacy, Addressability and Safety | Oct. 14, IAB Tech Lab
- CONFERENCE: Programmatic I/O — Digital Marketing | Oct. 25-26, AdExchanger.com
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QUOTE OF THE WEEK
Cornell researchers say current ad-tech puts user data in control of advertisers, which doesn’t benefit consumers
- The follow excerpts are from the abstract and text of the academic paper, “Online Advertising,Data Sharing and Consumer Control,” by Cornell University professors Justin P. Johnson, Thomas Jungbauer and Marcel Preuss. The Aug. 3, 2021-dated, 48-paper may be downloaded from the SSRC website. DOWNLOAD PAPER. Laurie Sullivan, of MediaPost.com, wrote about it this week, under the headline: Cornell researchers’ paper argues for giving consumers data control.
“When advertisers have strong property rights over data regarding consumers’ active purchase interests, competition between ad exchanges leads to too little sharing of data between advertisers. This harms consumers, who receive too few pertinent ads, and advertisers themselves can also be harmed due to a situation resembling a prisoner’s dilemma.
“We show that giving consumers property rights over their own data can improve outcomes; this happens when consumers can directly share data about their browsing history with ad exchanges.
“On the other hand, simpler consumer data rights, such as the right to not be tracked, can actually harm consumers due to how ad exchanges respond. Finally, initiatives by Apple and Google to limit third-party tracking, and introduce alternative tracking systems such as FLoCs, can benefit consumers by weakening the property rights of advertisers over consumer data. Because more data is shared by default under such systems, this is true even if these systems are less accurate than the third-party cookie system.
“We argue that the third-party tracking system therefore grants excessive data property rights to advertisers. These excessive property rights exist because of structural features inherent in the third-party cookie system. In particular, under that system an ad exchange is only aware that a consumer has visited a particular advertiser’s website if that advertiser has agreed to place a tracking cookie on that consumer’s browser. If an advertiser refuses to place such a cookie on behalf of a given ad exchange, necessarily that exchange cannot help other advertisers cross-target this consumer.
“In contrast to these negative assessments, we show that a move to the FLoC system may benet consumers. Moving to the FLoC system can benefit consumers even if it is less accurate at tracking consumers than the current third-party cookie system. The reason is simple: the FLoC system weakens advertiser property rights over consumer-generated data, and because those property rights are the root cause of the ineciency identied above, consumers can benefit.
“We emphasize that the main problem identied in our baseline model is not dependent on the use of third-party cookies as tracking tools a such. Rather, it is the default advertiser ownership of intent-to-purchase data, which gives advertisers some veto power over cross-targeting.” |
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| ABOUT PRIVACY BEAT
Privacy Beat is a weekly email update from the Information Trust Exchange Governing Association in service to its mission. Links and brief reports are compiled, summarized or analyzed by Bill Densmore and Eva Tucker. Submit links and ideas for coverage to newsletter@itega.org.
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