Google’s new plan for ad targeting raises new worries about competition in the UK
What is going on with Google’s long-talked-about move to a different adtech stack, also known as its “Privacy Sandbox” plan? What, indeed. The latest move by the Competition and Markets Authority (CMA), the U.K.’s antitrust regulator, seems to have put an end to the multi-year effort to change the way the business web works.
This is on top of Google’s change of mind about third-party tracking cookies. At first, they were going to lose value, but as of July, it looks like cookies are here to stay.
The CMA has been looking into Google’s Privacy Sandbox plan since January 2021, after a group of digital marketing companies complained in November 2020. This is one reason why the project has been so painfully slow. But slow is beginning to look like a clear “no” from the U.K. authority.
The CMA added another wrench in Google’s works by writing in a case update on Tuesday that it has “competition concerns” about its most recent changes. As a result of “the evolution in Google’s planned Privacy Sandbox browser changes,” the company would also have to keep promises it had made in the past.
At the very least, this means more delays for a project that is already years behind plan.
The Competition and Markets Authority (CMA) said it is talking with Google about changes and that Google would have to address its competition concerns. However, Google has not yet said which parts of the revised plan do not meet the mark. One thing is for sure, though: Google’s plan to switch to a user-choice design is on hold while the government looks at the effects.
The competition authority wrote, “If the CMA is not able to agree changes to the commitments with Google that address the competition concerns, then the CMA will consider what further action may be necessary.” The authority didn’t say what options might be on the table at that point, but did say that it would “publicly consult before taking any decision on whether to accept changes to the commitments, and is aiming to do this in Q4 2024.” It’s worth noting that Google had already agreed not to stop supporting tracking cookies without the CMA’s permission.
In the last three months of the year, the regulator says it will give a report on its “views relating to the Privacy Sandbox tools and its assessment of testing and trialling results.” What you’re hearing is the sound of a very damaged can being kicked down the road again.
Who Gets To Choose How Ads Are Shown?
This latest action by the CMA is related to a new plan Google announced this summer, when the tech giant said it might not get rid of third-party tracking cookies after all.
Instead, Google suggested that Chrome users could be given the option of seeing ads based on tracking cookies or ads targeted using Privacy Sandbox, Google’s alternative technology for personalised ad targeting that doesn’t use cookies to track and profile users.
By giving users a free choice to say no to any tracking, Google’s offer also meant that its suggested choice architecture for Chrome could let users completely avoid tracking-based or personalised ads. This would mean that users would be shown contextual ads instead. The identity of people would be safe because of this.
But the digital marketing firms that want to stop Chrome from getting rid of tracking cookies probably don’t like the idea of giving web users that much control over online ads.
It’s clear that the CMA is also looking at Privacy Sandbox through the lens of pure-play competition. This means that it needs to pay close attention to complaints like these.
The competition supervisor wouldn’t answer questions about how it works. However, we understand that the CMA is worried that Google’s new plan to give users a choice could make third-party cookies less available for ad targeting, making people rely more on Google’s Privacy Sandbox tools and other options.
Concerns that Google might use the Privacy Sandbox project to strengthen its position as the leader in the adtech stack are a competition-shaped problem. This is because the project will give web users more control over how to protect their privacy from marketers.
The CMA has said in the past that it is working with the UK’s Information Commissioner’s Office (ICO), which is in charge of enforcing national data protection rules, to look at privacy and user choice design issues that are important. But, as we’ve said before, the ICO has a history of not enforcing the adtech business enough, even though they know it has a problem with following the law.
More recently, the ICO’s moves in this area—going after certain types of cookie consent pop-ups that didn’t follow the rules—have led to the rise of another problematic ad industry trick: consent or pay mechanisms. In this controversial method, which is being fought in court in the European Union, web users are shown a consent pop-up that blocks content until they either agree to be tracked or pay a subscription fee to view it. It’s the exact opposite of having a choice.
What has the ICO done about getting permission or money? It held a consultation earlier this year, but it hasn’t taken a public stand on whether the controversial business model is legal yet. In the meantime, it hasn’t stopped the growth of a system that invades privacy.
All of this means that if the CMA is the only way for web users to protect their privacy rights in a high-stakes war for the future of the commercial web, with Google going up against digital marketers and the CMA on their side, it doesn’t look like a very fair fight. More like competition is being allowed to take over a list of hobbies.
When asked about the CMA’s latest action, Google spokeswoman Jo Ogunleye said the company is working with regulators and that the company thinks its new plan will help competition.
She also sent the company an email with this statement: “We are working with the CMA on Privacy Sandbox using the updated approach we’ve suggested, which lets people make an informed choice that applies to all of their web browsing.” As we finalise this plan, we’ll keep talking with the CMA, ICO, and other global regulators. We also look forward to working with the ecosystem to create a private internet that is funded by ads.
We also asked Lukasz Olejnik, a freelance expert who has been following the Privacy Sandbox plan since the beginning, for his opinion. “Keeping third-party cookies is bad for users,” he said, pointing out that the CMA seems to have changed its mind.
He also told Parhlo World, “I was very pleased with how professionally the CMA handled the move to a more private web in a way that respected competition.” “There has been a big change in enforcement priorities in the last few months, though.”
Olejnik said that there has been a change of government in the U.K., which could be the reason for the change, but it’s hard to understand why the regulator might have changed its priorities in this area.
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“Up until now, the CMA had a full understanding that third-party cookies are bad for privacy, data protection, and trust in the digital advertising sector,” he said. “I still think there is a business case for Privacy Sandbox, but taking that stance could hurt UK users’ privacy and trust in businesses.”
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