An advertising industry trade group is sounding the alarm over a proposal by the European Commission to limit how web users can be digitally targeted.
The move could hamper online advertising on the continent and eventually lead to layoffs in digital shops, according to the Interactive Advertising Bureau. But some major tech companies and consultants indicate they aren’t worried yet.
Responding to privacy concerns, the commission on Tuesday released a set of proposals for regulating the continent’s Digital Single Market.
“I want to ensure confidentiality of electronic communications and privacy. Our draft ePrivacy Regulation strikes the right balance: it provides a high level of protection for consumers, while allowing businesses to innovate,” Andrus Ansip, vice president for the Commission’s Digital Single Market, said in a statement.
According to the commission’s release, the proposal would “streamline” consent for users accepting cookies and “bans unsolicited electronic communication by any means, e.g. by emails, SMS and in principle also by phone calls if users have not given their consent.”
The IAB’s Dave Grimaldi said the proposals, if enacted, could endanger digital advertising firms on both sides of the Atlantic.
“This proposal risks harming the livelihood of millions of websites and apps that rely on digital advertising to fund content and tools for consumers, not just in Europe, but in the U.S. as well. As written, it will diminish our members’ ability to innovate by introducing prescriptive rules that cannot adapt to the rapidly evolving digital economy,” Grimaldi, executive vice president for public policy at IAB, said in a statement.
“Citizens in Europe and around the world are better served by laws and self-regulatory regimes that protect consumers without hindering access to their digital world. We look forward to supporting our industry partners in Europe as this proposal is considered.”
U.S. digital ad firms that operate in the political space are already under pressure after the anticipated spending deluge of 2016 failed to materialize.
Meanwhile, the announcement from the commission came as elections are set for across Europe this year. France has a presidential contest. Germany has federal elections. Holland has a general election, and the U.K. has local elections. There could be work for American consultants in those campaigns. In fact, European consultants say they’re eager to work with U.S. practitioners.
But American consultants haven’t been equally attracted to continental campaigns. That’s in part because there’s not as much money being spent on those races, but also because of restrictions on advertising. In the U.K. for instance, there’s a ban on TV advertising by the parties during a campaign. Instead, U.S. consultants have seen European races as way to learn from, say, observing voters’ online behavior.
Still, the IAB’s concern wasn’t matched by Google or Facebook, who didn’t issue a comment Tuesday in response to the news.
Jim Walsh, whose firm DSPolitical specializes in cookie-based advertising and has done work in Europe, said he shared their wait-and-see approach. In fact, he predicted the proposals were unlikely to be adopted in their current form. “There’s going to be a backlash among the publishers,” he said.
But if the proposals are adopted without significant changes, Walsh predicted they would be only “temporarily disruptive.”
“Any firm similar to mine would be committing malpractices if they were using only one methodology,” he said.
Walsh added: “I don’t see it as a net negative. It’s not a bad thing that it’s in the public discourse talking about protecting people’s privacy.”