Wednesday, May 31, 2023
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FTC takes customer data privacy seriously

The Federal Trade Commission has announced that it will consider rules to eliminate “harmful commercial surveillance and lax data security.” Even though Congress is enacting the American Data Protection and Privacy Act (ADDPA), the bill, if passed, would be enforced by the FTC.

Business surveillance is defined as “the business of collecting, analyzing and profiting from information about people” – a definition as broad as anything envisaged by the ADPPA.

View of the FTC. FTC Chairman Linda M. Chan said in a statement: “Companies are now collecting personal data from individuals on a massive scale, and against a staggering array of contexts. The increasing digitization of our economy — coupled with The vast expansion of business models that can incentivize the endless collection of sensitive user data and the ways in which that data is used—meaning that potentially illegal practices can be widespread.”

FTC has power under the FTC Act Take enforcement action against illegal data practices, the agency said. However, the jurisdiction lacks an advantage due to its limited power to impose financial penalties. “By contrast,” the FTC said, “rules that establish clear privacy and data security requirements across the board and give the Commission the power to seek financial penalties for first-time violations could incentivize all companies to invest more consistently in compliance practices.”

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Adtech responded. “The unfettered collection and monetization of user data has allowed big tech companies to grow unchecked, creating oligopolies that make it very difficult for small businesses, many of whom adhere to ethical and practical existing rules ,” said Steve Dunlop, CEO of personalised advertising firm A Million Ads. “We welcome any legislation that makes it a more level playing field for many companies to participate in, as well as a better and clearer deal for users.”

“At this point, behavioral targeting technology is developing to be outdated in some way,” admits Nadia Gonzalez, CMO of Scibids, a company that provides AI-driven digital marketing solutions. “The time has come to forge a favorable path in ad tech,” she said — especially with privacy-first ad tech, which she confirmed already exists.

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Why do we care. Jump into the agency, and suddenly our data protection runs along two tracks of legislation and regulation. The first thing to note is that in its public statements, the FTC employs “surveillance” language common among activist groups that have fought for years for tighter controls over data collection and use. This tells you where the FTC is coming from. In our experience, marketers don’t think they are “spying” on their customers.

The immediate response from the ad tech industry was a stoic acceptance. Regardless, data collection will be strictly limited. Get used to this idea and try other ways to save ad addressability.

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About the author

Kim Davis is Marketing Tech. Born in London but based in New York for more than two decades, Kim started dabbling in enterprise software a decade ago. His experience includes enterprise SaaS, digital advertising data-driven urban planning and the application of SaaS, digital technology and data in marketing. He first wrote about marketing technology as an editor at Haymarket’s The Hub, a dedicated marketing technology site, and later became a conduit for established direct selling brand DMN. Kim joined DMN in 2016 as a senior editor, became executive editor, and then served as editor-in-chief until January 2020. Prior to his career in tech journalism, Kim was an associate editor for the New York Times hyperlocal news site, Local: East Village, and previously worked as an editor for academic publications and as a music reporter. He has written hundreds of New York restaurant reviews for his personal blog and is an occasional guest contributor to Eater.



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