Today DCN sent a letter to The National Rifle Association (NRA), in response to their campaign to attack the press—including our members directly—with incendiary language. We’ve been watching carefully after they released this video and are increasingly disturbed by the transition into a much larger campaign by the NRA and other political actors. As we state in the letter, we respect their right to have a viewpoint and are simply calling out, particularly in a sensitive time, there are lines which shouldn’t be crossed regardless of the side of the debate you’re on.
CNN’s Brian Stelter broke the news here.
Earlier this week, we filed our formal comments with the FCC detailing DCN’s view on net neutrality. In the comments, we noted the potential hazards associated with allowing ISPs to give preferential treatment to some websites over other, particularly when it comes to those owned by the ISPs themselves.
The issues really come into focus when you consider the case of Verizon. Over the last few years, Verizon has made a series of strategic acquisitions of digital content – first, by purchasing AOL and all its properties and, recently, Yahoo (which have been combined under the Oath brand).
Many have speculated that these purchases were all about Verizon building scale to attract advertising dollars. And, if that was in fact their goal, Verizon is now heavily incentivized to maintain and even grow the audiences and platforms they have acquired. To do so, a natural next step would be for Verizon to provide faster access to its vertically-owned sites.
In addition, Verizon would be disincentivized to allow the same speedy access to websites that compete with, say, Yahoo Finance. It’s not even a matter of whether a competing site could try to pay for preferential access (which on its own makes it hard for smaller content providers to compete). In this case, Verizon would simply want to ensure that Yahoo Finance gets the most traffic. And given its unique ability to control access speeds, it would be in a position to do so.
It’s hard to imagine that a public company with profit motives and shareholder expectations wouldn’t make every effort to drive more traffic to its sites in order to show the value of these acquisitions. However, the larger issue here is that—as an on-ramp to the internet—Verizon could prioritize delivery of its websites, thus ensuring that consumers are more likely to access them.
The same dynamic would play out in any space where Verizon has its own content. It is not a stretch to assume that Verizon’s shareholders would expect Verizon to provide preferential access to Yahoo Tech, Yahoo Beauty, Yahoo Sports, Yahoo Lifestyle, TechCrunch, and HuffPost. In short, other tech review sites, fashion magazines, sports sites, lifestyle publications, and news organizations would lack the ability to compete fairly.
Adding to the problem is that there are only a handful of mobile broadband providers. (And, as we all know, mobile increasingly dominates content consumption.) So, if each of the mobile broadband providers has their own content for a specific vertical, the remaining content creators would be left without a chair in the game. In fact, they would find themselves at a significant competitive disadvantage. Instead of competing on quality of content, publishers would be forced to compete over who can be bought first by a mobile broadband provider.
We all agree that ISPs should not block or throttle consumers trying to access the plethora of available lawful content. But, we need to be equally careful to ensure that discriminatory deals don’t dramatically limit the number and variety of websites available to consumers. As the internet’s inventor Tim Berners-Lee said, “The important thing is the diversity available on the Web.” The Internet is a wonderfully weird place where innovation is the norm and a cacophony of voices flourish. Let’s keep it that way.
Dear Member(s) of European Parliament,
As you consider updates to the ePrivacy Directive, we are writing to offer the perspective of premium publishers of digital media content. Digital Content Next (DCN) was founded in 2001 and remains the only U.S.-based trade association that exclusively represents premium digital content creators. Several of our members are based in Europe and many more have a substantial presence in Europe. DCN members include many of the Internet’s most trusted and respected media brands, collectively reaching an unduplicated audience of 230.6 million unique visitors – or 100% of the U.S. online population monthly. Importantly, DCN members maintain direct, trusted relationships with consumers and advertisers.
We agree with the need to update and modernize the ePrivacy Directive to account for new technologies that are employed to track consumers in the digital world and hope to see a text which will more closely harmonize the Directive with the General Data Protection Regulation (GDPR). As you consider changes to the text of the Draft Regulation, we encourage you to focus on consumer expectations.
Context is Key
Consumers have nearly unlimited choices over where they can find news and entertainment online. If a consumer does not trust the site or the content, they can and do choose to go elsewhere. This creates a dynamic in which consumer-facing websites and apps must continue to earn the trust of their audiences or risk losing them. A key to maintaining that trust is to collect and use a consumer’s data in ways that meet with the consumer’s expectations. For example, when consumers visit a premium publisher’s site or app, they expect their data will be collected and used in ways to benefit their experience for purposes such as analytics, fraud protection, personalization, subscriptions and content recommendation. Consumers also are not likely to be concerned when their data will be used for benign purposes such as audience measurement or other uses where data is aggregated. At the same time, publishers need to be able to monetize their content through advertising in order to minimize costs for consumers. Certainly, there are also societal benefits from properly funded news organizations.
However, most consumers do not approve of their data being collected in one context and then used in a different context. For instance, absent any transparency, a consumer would not expect or even know that a data broker or a broadband service provider might be tracking their activity across the internet for the purpose of building a profile about them, which could then be used to deliver targeted advertising. A consumer might see the value in allowing a social media company or a search engine to track their activity while using their website or app, but that consumer would not approve of those companies continuing to track them long after the consumer had left their domain and visited a different website.
Our position is that the ePrivacy Regulation should require transparency and consumer consent in cases where consumer data will be collected and used across multiple contexts.Consumers understand and can see the benefits of the collection and use of their data within a single context. Conversely, collection and use of consumer data across different contexts is far less transparent and is much less likely to result in direct benefits for consumers. While differentiating between data collection and use within a single context versus data collection and use across multiple contexts would map with an average consumer’s expectation, it would have the additional benefit of avoiding over-notification of consumers. As the Draft Regulation notes in (22) of the preamble, “end-users are overloaded with requests to provide consent.” When consumers are flooded with notifications in digital media,they tend to become fatigued. They can also become annoyed when notifications cause friction in their digital experience – especially when they are simply attempting to access content from a trusted source. By focusing consent requirements on non-transparent data collection and use, the ePrivacy Regulation would minimize friction where consumers have trusted relationships while also creating a choice mechanism where a relationship does not exist.
The Role of Browsers
Finally, the current version of the ePrivacy Regulation suggests a central role for browsers in obtaining and storing consumer consent. While there may be merits to providing clear choices to consumers at the browser level, we are concerned that by making the browsers the sole point of obtaining consent for tracking, there could be an unintended consequence of increasing the leverage of large companies with browsers or platforms in the digital ecosystem, such as Google and Facebook, particularly if their primary business is selling advertising across the web thereby competing with publishers. At the same time, it would not make sense to require publishers to ask consumers for consent to track all of their activity across the internet. Indeed, publishers would likely ask consumers for consent to be tracked by the publisher and their chosen third party partners solely while on the site. As you consider the role that browsers can and should play, it is important that options are preserved and encouraged for narrow consent required for delivery of the context in which value is being delivered to the consumer.
We appreciate your efforts to protect the rights of European citizens. Please let us know if we can be of assistance.
Digital Content Next
Whether your browsing history should be private by default has become a key question in the past year. Shortly after the election, Congress repealed privacy rules that would have required broadband providers to get consent from consumers before they could share this consumer data with advertisers. Members of Congress noted that it was unfair to apply these rules only to the internet providers but not to other giant digital companies, including Facebook and Google. When Senators and Representatives returned to their home districts, however, they promptly got blasted by some of their constituents for appearing to protect the shady practices of cable companies.
Partly in response to the backlash, Rep. Marsha Blackburn (R-TN) introduced the BROWSER Act. It’s a bill designed to level the playing field for companies that collect data about consumers at massive scale. And it is inclusive of all companies that are able to collect data across much of the web like ISPs, Google and Facebook. At the same time, the bill guarantees more transparency and choices for consumers. Ignore the shrill extremists in this debate. For good faith actors representing industry or consumer groups, there’s a lot to like about this bill.
In short, the bill would require companies to obtain opt-in consent from consumers before using “sensitive” data. This would include financial, location, and health information as well as browsing history and app usage. Some have argued browsing history and app usage shouldn’t rise to the level of sensitive information. However, common sense suggests otherwise. How would you feel if someone tried to buy and then publish a list of the websites you visit? In short, this bill says where you go in both the real and virtual worlds should remain private until you grant consent. I find it hard to argue with this.
The bill goes a step further in prohibiting companies from altering or denying service for consumers who do not opt-in. This provision is likely to draw the ire of industry lobbyists. But there’s a lot of merit in putting the onus on companies to develop a good “elevator pitch” for consumers. Companies that convince customers of the value to consumers are likely to be rewarded with their business—and trust.
Finally, the bill designates enforcement authority to the Federal Trade Commission (FTC). This is something that the entire cable lobby advocated for just a few months ago. Consumer advocates might want more robust enforcement tools for the FTC, but I question whether the federal rulemaking procedure is agile enough to adapt to changing technologies and business models. FTC guidance and enforcement cases can provide useful direction and clear lines for appropriate behavior.
To be clear, this is just the beginning of a long and uncertain legislative process. But, it’s an important development that Rep. Marsha Blackburn (R-TN), a conservative Republican with a decent amount of experience with tech issues, has moved down this path. The fact that a few voices at the edges of the spectrum are opposed means she probably got it exactly right.
According to recent reports, Federal Communications Commission (FCC) Chairman Ajit Pai is preparing to roll back the net neutrality rules put in place by former Chairman Tom Wheeler. While we don’t know the exact details yet, Chairman Pai is aiming to restore the jurisdiction of the Federal Trade Commission (FTC) over ISPs in exchange for promises from the ISPs to not block or throttle content and to not engage in paid prioritization deals.
Let’s put aside the debate over whether the FCC or FTC is best positioned to police broadband providers and whether mere promises from cable companies will be enough to protect consumers. Make no mistake – there is a lot to consider there.
For now, let’s dig into what provisions of net neutrality are important for a free and open society. As we noted in our 2015 comments to the FCC, consumers should be able to access content they choose. Therefore, it makes sense to prohibit blocking and throttling by ISPs. Also, “paid prioritization” deals could potentially favor content creators with more resources and market power over non-profit or startup companies. “Paid prioritization” would also likely favor content companies that are owned by the ISPs. Certainly, without transparency and safeguards, “paid prioritization” quickly starts to feel like paying a ransom.
Missing the Plot
What’s more concerning about Chairman Pai’s proposal is what is missing. Namely, the silence on “zero rating” plans and the lack of basic privacy protections for consumers.
During the debate over the FCC privacy rules for broadband providers, many cable lobbyists complained that these rules would create an un-level playing field. There was concern that ISPs would have more restrictions on their ability to surreptitiously collect and sell consumer data than companies like Google. To be clear, if you’ve watched the continued rise in the use of ad blocking software by consumers, then you know consumers aren’t happy with the rise in “big brother” data collection methods by corporate giants.
However, in restoring FTC jurisdiction, there is an opportunity to create a level playing field while at the same time providing some basic privacy protections for consumers. As I noted a couple of weeks ago, the industry’s self-regulatory code requires any company that tracks “all or substantially all” of a consumer’s activity on the web to obtain that consumer’s consent. Companies like Google and Verizon have already publicly promised to abide by these rules. If the FTC holds the industry to the promises made in their self-regulatory code, we would have a level playing field that begins to match with most consumers’ expectations under a flexible FTC enforcement regime.
Zero Rating Issues
“Zero rating” plans also need to be addressed. This is the practice whereby a broadband provider allows consumers to access content without counting that access against a data cap. ISPs tend to “zero rate” content that they own (see Verizon’s AOL and Yahoo content). As more and more content consumption moves to mobile devices (with data plans), “zero rating” will become a huge issue. Most consumers don’t have unlimited data plans and many broadband providers have stopped offering them altogether.
The concern with “zero rating” is that there are only so many content creators that can benefit. This is partly true because a broadband provider only wants one content creator per vertical. For example, AT&T might accept payment from sportingnews.com to “zero rate” their content. Verizon owns Yahoo Sports. But where does that leave every other content creator in the sports world? Doesn’t this create a barrier to entry for any startup? This quickly becomes a game of a musical chairs that doesn’t end well for consumers, innovation or minority voices.
Open or Closed
Content creators thrive in a competitive and open marketplace in which they compete on the value of their news and entertainment. Unchecked “zero rating” plans could have the same effect as ISPs engaging in blocking, throttling and paid prioritization.
We can and should have a robust debate about whether the FTC or FCC is best positioned to promote net neutrality. But let’s not lose sight of the opportunity to protect the internet’s promise of wide, open access and the societal good that promise has delivered since its inception. Any net neutrality plan must also address “zero rating” and set a level playing field for consumer privacy protections. Without these safeguards, the hallmark characteristics of the open web — diversity of voices, opportunity for discovery and freedom to innovate — are imperiled.
Freedom of the press around the world declined in 2016 for the 12th year in a row, according to Freedom House. Between reporters being jailed as enemies of the state and news organizations being shut down completely, journalism today faces a very hostile environment. Our current president’s tweet that the press is “the enemy of the American people” only introduces more turmoil for journalists and emboldens dictators around the world. His claim also couldn’t be further from the truth.
As Ronald Reagan famously noted, America is “a shining city on a hill.” Our experiment with democracy is on full display for the world to see. And one of the more important factors of our success is a free and independent press. Over the course of our history, the world has seen an educated, relentless and free press expose the Teapot Dome Scandal and President Nixon’s Watergate along with countless local cases of corruption and deception. A free press is a bedrock principle of democracy. It provides necessary transparency, helping to educate citizens and fulfilling an important check on power.
On Presidents and a Popular Press
Yet, despite its importance, a recent Gallup poll showed that public approval ratings of major media platforms are at all-time low. It’s worth noting that, in the last 20 years, the media’s approval ratings have never risen above 40% for digital, print or television news. One could argue that if the press isn’t hated, then it’s not doing it right!
Before he became president, Thomas Jefferson was an original proponent of a free press. In a letter from 1787, he wrote “And were it left to me to decide whether we should have a government without newspapers, or newspapers without a government, I should not hesitate a moment to prefer the latter.” However, during his successful campaign for President in 1800, candidate Jefferson endured heavy scrutiny by the press. By the time he took office, he hated the press or at least what he thought it had become. In his second term, he even ordered the arrest of newspaper editors for sedition. However, by 1816, seven years after he left the presidency, Jefferson wrote in a letter “where the press is free, and every man able to read, all is safe.”
Similar, strained relationships with the press continued with later administrations. After the failed invasion at the Bay of Pigs, President John F Kennedy stated “…the abrasive quality of the press applied to you daily, to an administration, even though we never like it, and even though we wish they didn’t write it, and even if we disapprove, there isn’t any doubt that we could not do the job at all in a free society without a very, very active press.”
Declaration of Independence
And just a few days ago, when asked about the role of the news media, former President George W. Bush responded, “I consider the media to be indispensable to democracy. We need an independent media to hold people like me to account. Power can be very addictive. And it can be corrosive. And it’s important for the media to call to account people who abuse their power, whether it be here or elsewhere.” This from a president who lost the popular vote but won the Electoral College. He assumed office at a time when the nation was highly politicized and divided. He weathered withering criticism from the press about his policies, cabinet picks and early missteps.
This is the point: Elected officials and most citizens will never like a healthy press corps. We don’t need journalists to be loved. We need them to be aggressive, persistent and abrasive. In turn, politicians should respect the press’ role in our democracy, not undermine it for their own political gain. Struggling democracies and entrenched dictators around the world are watching our “shining city on a hill.” What do we want them to see?
In late October, the Federal Communications Commission (FCC) approved sweeping new privacy rules, which require Internet providers Service Providers (ISPs) to obtain affirmative opt-in consent before collecting and using sensitive consumer data. Importantly, sensitive data was defined broadly by the FCC to include financial and health data, geolocation, social security numbers and—for the first time—browsing history and app usage data. ISPs would need to offer consumers a way to opt-out of the collection and use of non-sensitive data. With Donald Trump’s election, a Republican-led FCC is likely to withdraw or significantly alter these privacy rules. So, where do we go from here?
It is important to note there is significant precedent and support for requiring a higher data collection threshold for ISPs. In 2012, the Federal Trade Commission (FTC) issued a report, entitled “Protecting Consumer Privacy in an Era of Rapid Change,” which laid out a framework for how companies should protect consumer privacy. The report drew lines between practices that would meet an average consumer’s expectations and those that would not. In their argument for a heightened requirement for ISPs, the FTC noted that “ISPs serve as a major gateway to the internet with access to vast amounts of unencrypted data that their customers send or receive over the ISP’s network. Thus, ISPs are in a position to develop highly detailed and comprehensive profiles of their customers—and to do so in a manner that may be completely invisible.”
In addition, the Digital Advertising Alliance (DAA), the industry’s self-regulatory body, holds ISPs to a heightened requirement because they are in a unique position to “collect all or substantially all” of a consumer’s data. As the DAA Principles note, ISPs or “service providers” must “obtain the consent of users before engaging in online behavioral advertising.” For comparison, the DAA requires only that websites offer consumers a way to opt out.
This differentiated treatment of ISPs exists for good reason—there are fundamental differences between ISPs and other actors in the ecosystem. While the FCC has asserted on several occasions that it has no ability to regulate edge providers (aka websites), FCC Chairman Tom Wheeler also recognizes the difference between ISPs and edge providers. He has noted that consumers have fundamental choices about which websites they visit, while they do not have the same kind of choice when it comes to their ISPs. Indeed, the above-mentioned FTC 2012 Privacy Report notes that data collection and use by publishers like members of DCN tends to meet consumers’ expectations because that data collection and use occurs within the same context.
As we noted last February, context matters. DCN members go to great lengths to provide a trusted experience for consumers because our members understand that consumers have a myriad of places from which to get news, entertainment and information on the internet. This trusted experience and direct relationship with the consumer is also the value proposition for advertisers. Ubiquitous and non-transparent tracking by 3rd parties undermines the trusted experience that premium publishers are striving to create for their audiences.
As Ben Thompson notes in his post-election wrap, digital advertising has been built to be mostly direct marketing and data arbitraging on the failed premise that consumers don’t really care about their individual privacy or right to use the web without being tracked by 3rd parties. But the reality is that consumers do care – they’re limiting their online activity, clearing cookies, enabling Do Not Track signals and increasingly adopting ad blocking software. The current dynamic that favors a clear (and legal) arbitrage opportunity is actually harming advertisers and publishers along with the consumers they both serve and need. To continue ignoring these consumer concerns is likely to invite more regulatory scrutiny and foster an unhealthy digital economy. But, more importantly, ignoring these trends is also a missed opportunity for premium publishers who are best positioned to benefit from increased consumer trust.
While there will be significant debate about whether the FCC should have acted and whether the rules should be repealed, let’s be clear: Value should be shifted back to companies that collect and use consumer data transparently and in ways that meet with consumer expectations. In this way, the FCC privacy rules may serve to help publishers. If more companies act in an open and respectful manner, perhaps we can begin to repair the consumer trust issues that have battered our industry. In a world where context matters, premium publishers matter.
Apple recently announced a fairly big change in their “Limit Ad Tracking” setting. Going forward, when a consumer activates the setting, the Identifier For Advertising (IDFA) will be set to 0. Thus, advertisers and ad tech companies would no longer be able to track that device across apps or websites and over time. While Apple asked companies to honor the “Limit Ad Tracking” setting before, it was hard (maybe impossible) to know whether companies actually complied. Now the setting has some teeth.
In response, ad tech lobbyist Alan Chapell is accusing Apple of giving consumers a way to opt out of advertising altogether. Naturally, as someone who advocates on behalf of publishers on these kinds of privacy issues, I had some initial reactions.
First, it’s absolutely ludicrous to say this is an opt out of advertising. Certainly it’s an opt out of behaviorally targeted advertising. But, the ads aren’t being blocked – they can still be served. What’s more the advertiser can still know that the ad has been served, where it was served and how it performed – companies would have a number of other options to derive this data. But let’s be clear: Advertisements can and will continue to be served. Apple’s change simply allows consumers to stop third party companies (with which they have no relationship) from using their IDFA to track everything they do on their device. There is actually a healthy argument that this change will make context and consumer relationships more valuable, which is important to both the consumers and the publishers of the content they enjoy on the web.
Which brings me to my second point: Consumers have been looking for ways to limit third party tracking for years and Apple is simply trying to meet that consumer need. Early on, consumers signaled their desire to limit tracking by clearing cookies – those tiny bits of code that ad tech companies planted on your computer. According to TRUSTe’s 2015 Privacy Index, 63% of consumers still clear their cookies. Then consumers started turning on the Do Not Track (DNT) signal in their browser. The World Wide Web Consortium (W3C) has developed a standard, which the ad tech lobby has been fighting against tooth and nail. And, of course, now consumers are increasingly turning to ad blocking software.
Finally, Chapell points out that “addressability should not be under the total control of a single entity.” Sounds like a great idea to have a multi-stakeholder group help set policy and technical standards. But, when the W3C (you know – the people who helped create the web) convened a multi-stakeholder group of representatives from all segments of the industry along with a few consumer groups, the ad tech lobby including Chapell worked to undermine and destroy the effort.
To answer the question posed by Chapell – do consumers have a right to opt out of advertising? – it should be painfully obvious by now that consumers are already opting out of advertising. Instead of throwing stones at groups and companies trying to address the underlying consumer need, perhaps Chapell and the ad tech lobby could work on giving consumers an easier and more robust way to express their preferences. DNT would be a decent start. Without better choice mechanisms, consumers are going to increasingly turn to blunt tools like Apple’s Limit Ad Track setting and ad blockers.
“Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof;
or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to
petition the Government for a redress of grievances.”
—First Amendment to the Constitution (1791)
According to Freedom House’s Freedom of the Press report for 2016, press freedom worldwide has declined to its lowest point in 15 years. According to the report, only 13% of the world’s population enjoys a free press. From the heinous attack on Charlie Hebdo to state-sponsored censorship in China to violence committed against journalists covering organized crime in Mexico, it’s clear that journalists are increasingly hindered around the globe. Lest we become complacent, it is important to note that the U.S. only ranks at number 41.
Against that backdrop, it’s especially concerning when Donald Trump says that “70 to 75% of it (media) is absolutely dishonest, absolute scum.” And, he hasn’t stopped there. He mocked a disabled reporter. And, when a reporter asked him a tough question about the alleged funds he raised for veterans’ groups, Trump’s response was to call him “a sleaze.” It would be one thing if this was just bluster. But, Trump has advocated for the re-opening of libel laws so “we can sue (news organizations) and win lots of money.”
To understand what Trump wants to do, you only have to look across the Atlantic at the British libel laws. In order to bring a libel suit in the U.S., a person must prove that the published work was false. However, in the U.K., the onus is on journalists and reporters to prove their claims are true in court, which costs substantial time and money. This creates a chilling effect on reporting and free speech especially with regard to rich and powerful people or organizations.
In 2014, Cambridge University Press said it wouldn’t release a book critical of Russian President Vladimir Putin in the U.K. because it feared being sued. John Haslam, Executive Publisher at Cambridge University Press noted in a letter to the author that “the disruption and expense would be more than we could afford, given our charitable and academic mission.” More recently, HBO declined to release Going Clear—a documentary about the Church of Scientology—in Britain because of the high costs associated with defending against a libel suit. There are also cases of whistleblowers like Peter Wilmshurst being taken to court by a pharmaceutical company. Wilmshurst, a cardiologist, took issue with the science supporting a specific cardiac drug. When he proposed to publish data from his experiments, he was sued for libel in an attempt to repress his findings. He successfully defended against the suit, but only after years in court and much cost to him.
Trump hasn’t offered any specifics about his plan to amend libel laws here in the U.S., but his stated goal of being able to “sue and win lots of money” suggests that he would go at least as far as Britain’s laws. And, to be fair, Trump isn’t the only one working to undermine press freedoms. The rich and powerful often want less criticism of their actions. For these reasons, the Founding Fathers made the First Amendment clear: “Congress shall make no law…abridging the freedom of speech, or of the press.” This fundamental and important boundary for government is essential to the free flow of ideas and leads to an informed public.
In 1804, Thomas Jefferson wrote in a letter that “Our first object should therefore be, to leave open to him (man) all the avenues to truth. The most effectual hitherto found, is the freedom of the press. It is, therefore, the first shut up by those who fear the investigation of their actions.”
Nelson Mandela echoed these sentiments in 1994: “A critical, independent and investigative press is the lifeblood of any democracy. The press must be free from state interference. It must have the economic strength to stand up to the blandishments of government officials. It must have sufficient independence from vested interests to be bold and inquiring without fear or favour. It must enjoy the protection of the constitution, so that it can protect our rights as citizens.”
America should strive to serve as an example of freedom and democracy. We should resist efforts to rein in the press by politicians who are either thin-skinned or trying to hide something. We should support the work of media organizations to shine a light on uncomfortable truths. We should applaud journalists who hold people in power accountable—not make it easier for wealthy individuals, government institutions, corporations and elected officials to silence their critics. Without a strong and independent press, we are less likely to hear opposite points of view—already a problem in American politics. We are more susceptible to demagogues, who feed on false information and half-truths. Without a free and vibrant press, the quality of our public debate will diminish, our political leaders will run unchecked and our democracy will suffer.
According a recent report in the New York Times, the majority of new online advertising revenue—85%—will go to two companies: Google and Facebook. While these companies have consumer-facing services, the reason they dominate the digital advertising ecosystem is because of the technology and algorithms they employ as third parties. Third parties collect data about consumers yet have no direct relationship with them. In addition, those people usually have no idea that their data is being collected.
When you consider that direct response ads represent nearly two thirds of digital advertising and these companies only get paid when consumers click on ads it’s no wonder we see the digital experience dominated by annoying, intrusive, and crappy ads.
And how are consumers reacting to this situation? As TRUSTe has noted, clearing cookies is still the primary method employed by consumers to protect their privacy. However, clearing cookies has detrimental effects to the user experience such as requiring consumers to log in every time they revisit a site which then makes the stalking, creepy ads come back even more. Yet they still clear cookies because it’s one of the main tools they know about to prevent being tracked. In this dysfunctional dynamic, big data is being used to drive down costs of serving targeted ads rather than drive up relevance to the consumer.
A few years ago, consumers started activating their Do Not Track (DNT) signals in an effort to express a choice, even though there was no industry standard yet. As Doc Searls plotted out, the number of DNT signals declined at the same time that the number of consumers with ad blockers started climbing. It’s not a coincidence – consumers have been looking for easy ways to express choice. If this continues, publishers won’t be able to fund quality content like this piece about the early season slide of the Yankees.
It’s interesting that our members are having some success asking consumers to turn off their ad blockers in order to access the content they love. The conversation goes something like this:
Website owner: Hi loyal reader, would you pretty please turn off your ad blocker or whitelist this site? We need advertising revenue to pay for quality journalism.
About 40% of consumers: Sure! I love you guys.
The remaining 60% of consumers: Meh. I’m gonna go look elsewhere for that story about Trump. I really, really hate those annoying ads on those other crappy sites I visit.
My take on this is that consumers understand premium experiences and are willing to view advertising in exchange. But, the value proposition gets out of whack when there’s no transparency for the consumer and the experience is poor.
Meanwhile, advertisers aren’t happy either. As the ANA pointed out, $7.2 billion was lost to fraud last year. They’ve been paying for ads that aren’t even viewable. There are also huge concerns about the inability to fully document where all of their digital advertising dollars are going. In short, there’s a lack of transparency and trust for advertisers. Sound familiar?
So, how does our industry find its footing again? We’ve got to be more clear with consumers about the value proposition and provide them with easy ways to express choice over ubiquitous data collection. By putting consumers first, we also force the issue on ad fraud, viewability and accountability. Every company involved in the digital advertising supply chain would have to justify how it’s adding to the overall value proposition. They would need to “put in more value” than they “take out” – the best way to build trust.
The FCC recently proposed privacy rules for broadband providers that aim to give consumers more control. The problem is that this only applies to ISPs – not all of the other entities that relentlessly track consumers around the web. And, government regulation often becomes outdated very quickly – market solutions or real industry self-regulation are far more able to adapt to new business models and practices. Maybe the FCC proceeding will lead to a new conversation within industry.
With the growing market of Internet of Things, immersive experiences and connected world we live in, the strains on trust between advertisers, consumers and publishers are only going to get worse. We need to find the right balance of providing consumers with transparency and real choices. Consumers are looking for a better experience. Advertisers are demanding fairness. And, I would like to live in a world where I can read all about how badly the Yankees are playing.
Julie Brill has been an unwavering advocate for the consumer during her time as FTC Commissioner. DCN had the privilege of hosting her at our event last December “The Consumer Rules: Lessons From Ad Blocking” where I interviewed her on everything from the definition of consumer harm to the notion that privacy today is more about controlling who you communicate with — and how — than seclusion.
Hindsight is 20/20 but many of her concerns over the years related to privacy and consumer trust in the digital ecosystem have come true with the advent of major issues like ad blocking. I look forward to seeing where her expertise and focus on consumers and privacy takes her as she re-enters the private sector.
Another day, another outlandish campaign promise from Donald Trump. This time, he threatened to “open up the libel laws” so he can sue the press when they write articles that he doesn’t like. While there is no federal libel law, whatever means Trump uses to fulfill his campaign promise would likely undermine some basic First Amendment protections. You know, part that says, “Congress shall make no law…abridging the freedom of speech, or of the press…”
With bulldozing, blustering candidates like Trump, robust protections for the freedom of the press are more important than ever. A strong and capable press corps is a hallmark of a healthy democracy. Just look around the world: Where you find restrictions on the press, you find authoritarian regimes that limit freedom of citizens. In some countries, press organizations are restricted in what they can say. In others, journalists are restricted in their access to social platforms or technological tools.
For all these reasons, it’s important that the multi-stakeholder process, organized by the National Telecommunications and Information Administration (NTIA) to develop a set of best practices to regulate the use of drones, recognize that journalists have fundamental protections under the Constitution.
A new technology such as Unmanned Aircraft Systems (UAS) doesn’t change the need for a free press. In fact, as ever, the press need to be able to utilize new technologies to continue effectively informing the public. The printing press enabled newspapers to reach mass audiences. The photograph helped reporters paint a more vivid picture. Now, UAS help journalists describe the full impact of a natural disaster or the landscape of a war-torn region. Access to new technologies helps journalists maintain their effectiveness and meet the expectations of the public.
The multi-stakeholder model developed by the NTIA has proved useful in bringing together diverse viewpoints and constituencies to hammer out agreements on thorny public policy issues. That said, journalists using drones to inform the public is very different from Amazon using drones to deliver packages. The Constitution recognizes the difference. The courts have recognized the difference. Because the NTIA group’s final product could be used as a framework for legislation at the state or federal level, it should also recognize the difference. Journalists need strong protections and access to the latest technology in order to maintain a robust democracy that can withstand any blustering, bulldozing political movement du jour.