ICO challenge to industry is an opportunity for positive change
The UK’s online advertising and publishing sectors are currently preparing for a major shake-up to a staple component of their trade.
With a looming Christmas deadline, the way online personal data is used on the programmatic open-exchange will need to change – the result of an investigation and subsequent report by the Information Commissioner's Office (ICO) into real time bidding and GDPR compliance.
Since publishing its report earlier this year, the ICO has opened a dialogue with the industry - including brands, adtech vendors, publishers and trade bodies - as it wraps its head around what is a hugely complex market.
A very simplified understanding of the issue, however, relates solely to how personal data is used for a large proportion of online advertising activity, with a particular concern over sensitive data related to sexuality, health and religion.
The view of the ICO is that vast swathes of the market are not meeting compliance with the 2018 General Data Protection Regulation (GDPR), and thus operating illegally. However, given the nebulous and complex supply chains in operation, the entire industry - from the brands bankrolling it to the publishers hosting the working media, and the myriad adtech vendors in between - have been given a grace period in which to adapt and change.
After the deadline expect a crack down in which fines could issued to those that refuse to play ball.
Despite the technical headache of doing this, many people operating in the market – particularly on the publisher side - were already uncomfortable with how personal data was being used in an environment prone to supply chain leakage and low consumer sentiment towards targeted ads. Yet it was helping to keep many under-pressure businesses afloat - a case of we have to do it, because everyone is doing it.
The ICO has been understanding of this predicament, which is why it won't just pull the plug and issue fines. Rather, it wants to help the industry get to where it needs to be.
As Simon McDougall, executive director of technology and innovation at the ICO, said at a recent Rezonence event investigating the issue: "we're concerned about this industry because of the scale of what is going on...adtech is unique and the type of data it uses is worrying - but the intentions behind its use are largely benign - [the industry] just wants to better serve ads."
McDougall added that the entire industry now needs to "move the dial" - and by Christmas the ICO will have a clear idea on whether it's willing to evolve.
Some form of industry-wide collaboration here is essential: by shifting everyone on a rising tide, the bad actors will be quickly identified. And those that do fail to act are likely to be put out of business.
It might be considered a long-overdue clean-up, and certainly a maturing, of a market that has long been accused of lacking accountability.
“The labyrinth that is the digital advertising ecosystem has made it far too easy to pass the buck in times of crisis, with the consumer-facing end of the supply chain - the media owners - usually having to pick up the pieces,” says Ross Noach, head of marketing at Rezonence.
“The GDPR is no exception, as the industry looks to wash their hands of responsibility, expecting media owners’ consent frameworks to bail them out.”
Noach adds that this is not in keeping with the spirit of the GDPR, which represented the biggest shake-up to privacy regulation in more than two decades.
From brands to adtech vendors, "the onus lies equally with the entire ecosystem,” Noach says.
“If we are to find a sustainable route forward the industry needs to work together, but most importantly, in the spirit of the GDPR — not merely looking for loopholes and workarounds.”
That route forward might induce a technical headache for the sector - but the ICO says it's "delighted" with how the trade body for Internet advertising, IAB UK, along with its members, has responded.
Publishers might be worried for now too - but ultimately, ditching the personal identifiers (including cookies) marks a return to contextual-based advertising, and that is where news and magazine brands can really start to take back some power.
Contextual advertising was once a staple of the publishing industry, but was usurped by the very methods the ICO now wants to crack down on. However, more recent technological advances – particularly around AI and machine learning – mean whatever the industry embraces as a GDPR compliant alternative should be much more effective.
Now, as the year draws to a close, the IAB says it continues to work closely with the ICO to address the concerns it has raised with the industry, with the ultimate goal to make the industry more accountable.
“While there is no ‘silver bullet’ solution to any of these issues, collaboration is key to improving standards across the board,” says Christie Dennehy-Neil, head of policy & regulatory affairs, IAB UK.
“My advice to any company engaged in RTB – whether buying, selling or facilitating – is to ensure you have reviewed your own practices to make sure you are acting compliantly, and to stay abreast of updates,” she says.
“There are some complex issues here, but we must take this opportunity to demonstrate that we can collectively create an ecosystem that works for regulators, the industry and, most importantly, the user.”