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Targeted Ad Distribution Campaign at DMA Amid Business Concerns – EURACTIV.com


A move by some EU lawmakers to ban targeted advertising has fueled the debate on regulating big tech, with several business leaders voicing their concerns.

The trade organization Connected Commerce Council on Monday (23 August) criticized the Green MPs for putting forward a proposal to restrict targeted online advertising, arguing that a ban would harm small businesses in particular by reducing effectiveness and the Advertising costs increased.

Targeted advertising, including its rapidly growing online form, enables marketers to target consumers with ads that reflect their specific interests and shopping behavior.

Green lawmakers are among those leading the restriction of targeted advertising debate that has rallied around the Tracking Free Ads coalition that hosts MPs from various political groups.

The latest initiative consists of an amendment to the Digital Markets Act (DMA), a landmark piece of legislation to regulate large tech companies.

“Digital advertising is the most important marketing tool for countless European small businesses. With limited budgets, targeted ads enable small advertisers to find potential customers more easily and cheaply than ever before, ”said Brandon Mitchener, advisor to Connected Commerce Council (3C) Europe.

“Eliminating this valuable small business resource will only benefit large companies that already have brand awareness and can afford to spend millions of dollars on mass media advertising,” added Mitchener.

Vested interests

3C claims to represent the interests of its members, including 1,800 small businesses from 17 European countries. However, the company declined to provide a full list of its member organizations.

Margarida Silva, researcher and activist at the Corporate Europe Observatory, criticized 3C for a lack of transparency and for not being registered as a lobby in the EU transparency register.

“The 3C tries to influence EU politics while evading its lobby transparency rules. If an organization claims to represent 1,800 small and medium-sized enterprises, it should at least be able to disclose who these members are. “

“MEPs and other EU officials need to know exactly whose interests are represented by the organizations trying to influence them,” said Silva.

Facebook and Google, the world’s largest online advertisers, partner on 3C’s website as the stated intention is to connect small businesses to platforms that allow them to sell their services.

In 2019, Campaign for Accountability, an American NGO behind the Tech Transparency Project, accused 3C of covering up its real intentions, advocating small business concerns and actually promoting the interests of big tech. A 3C spokesperson told EURACTIV that its positions are always approved by its members.

Business concerns

Magdalena Piech, Chair of the European Tech Alliance (EUTA), which gathers established and grown companies in Europe, at least shared 3C’s concerns.

“A blanket ban on all forms of ‘personalized advertising’ would do more harm than good to consumers, European digital companies, media groups, publishers and advertisers,” she said.

While Piech agreed that advertising should respect consumers’ rights, comply with EU data protection and other relevant legislation, he said that “in-depth discussions on this issue are needed to avoid overlap and contradiction, while respecting the rights and needs of everyone interested persons are taken into account ”. Parties. “

Sebastiano Toffaletti, Secretary General of the European DIGITAL SME Alliance, expressed a more cautious stance.

“We take a rather critical view of the downsides of the advertising-based business models of the big players, but it is of course important to consider the effects of a ban on targeted advertising for small businesses and internet-dependent companies as a whole.”

Toffaletti noted that the complexity of the subject would require in-depth study to understand the full impact of the regulations on small businesses.

Upcoming negotiations

Andreas Schwab, the DMA chief negotiator in the European Parliament, stated that the change in question did not provide for a general ban on targeted advertising, but rather would try to prevent the gatekeepers, very large online platforms, from giving up their market power for targeted advertising use across different services.

The change would therefore strengthen an important obligation for gatekeeper platforms, prohibiting them from combining the personal data collected through their various services without the express consent of the user.

In this context, Instagram, for example, is not allowed to pass on any personal data to its parent company Facebook or YouTube to its owner Google.

Schwab said he has yet to finalize its review of the DMA’s 1,200 amendments, but said he is against a general ban on targeted advertising that the Tracking-Free Ads Coalition is trying to advance under the Digital Services Act.

Leading MEP’s offer to “take back control of Big Tech”

The EU legislator responsible for the Digital Services Act (DSA) sees the groundbreaking law as a “democratic set of rules for online platforms” and names consumer protection and product safety as the red line for future negotiations.

[Edited by Zoran Radosavljevic]


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