Over the last few weeks, many consumers have been receiving a deluge of emails from data handlers, controllers and processors seeking to re-obtain consent for communication under Europe’s new GDPR.
But could the complexity of the issue force some of the operators to simple stop doing business with Europeans altogether? That is what one analyst thinks.
“We’re going see more companies pulling out of Europe,” says Forrester Research principal analyst Fatemah Khatibloo.
“From an ad-tech perspective and a mar-tech perspective we’ve already seen companies like Drawbridge, Verve Wireless say, ‘Yeah we can’t maintain our European operations’. And I think we’ll see a lot more of that as some of the ad-tech players really realize how significant GDPR is going to be on their businesses.”
What is GDPR?
May 25 is the final deadline for compliance with the new legislation. Under GDPR, consumers can stop companies anywhere in the world from collecting and processing their personal data, including the right to stop automated decisioning- something on which much modern advertising technology depends. New GDPR stipulations give consumers new protections including:
- tighter consent requirements for the collection of citizens’ data.
- consumers can instruct companies to stop processing their data.
- automated decision-making and profiling decisions must be made clear.
- consumers can request decisioning by automated processes be stopped and handled by a human instead.
- they have the right to request an explanation of automated decision-making.
- they can request free access, rectification and deletion of data.
Penalties for not supporting the new rights run up to 4% of global turnover, up to a maximum €20 million, and GDPR applies to any worldwide company processing the data of European citizens.
Earlier this month, we saw the ironic case of Unroll.me – a web service designed to help consumers ignore excessive mailing list messages – itself stop operating in Europe because the company cannot comply with GDPR.
The legislation will force changes for many ad-tech vendors and practices, though many such companies were already facing changing head-winds and shifting consumer attitudes as advanced profile-building techniques and practices like those involving Facebook and Cambridge Analytica come to public prominence.
“I think it’s also going be really interesting to see the number of sites that block European visitors,” Khatibloo adds. “There are a few companies out there that are now saying, ‘Hey website owner’, whether you’re a publisher or a brand, “we can block any Europeans from actually seeing your page.”
All this talk of cutting Europeans adrift rather than comply in the spirit of consumer privacy is spurring a wave of opportunism, as small technology providers like GDPR Shield (whose own website was down at time of writing) spring up to help publishers block European users, alleviating themselves of the compliance concern.
Darkness and the light
Forrester’s Khatibloo thinks the sell side will also be affected.
In truth, GDPR has been the crucible of a huge amount of attention, but has likely been a canvas for both unnecessary and mercenary mailings by data holders.
GDPR offers provisions to data holders such that, where a user is receiving a mail for the primary purpose for which they signed up, a data holder need not necessarily re-obtain that consent for that same purpose.
Things get more complicated when companies have been using data for purposes beyond the scope of users’ prior consent.
On the other hand, some companies which are trying to re-obtain consent stand accused of coercing recipients, by suggesting that mere continued use of their service after May 25 constitutes acceptance. By contrast, GDPR states that consent must be explicit and active, rather than passive or silent.
Facebook’s attempt to re-obtain users’ consent “fundamentally flies in the face of affirmative, informed consent” principles. “I think that is Facebook’s way of pushing the envelope,” Khatibloo said.
This interview was conducted earlier this month at the Digital Media Summit 2018 presented by LUMA Partners.
This video is part of a series titled The Consumer First, a New Era in Digital Media presented by MediaMath. For more from the series, please visit this page.