Behavioural targeting at the European Consumer Summit

By EDRi · April 8, 2009

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Deutsch: [Behavioural Targeting am Europäischen Verbrauchergipfel |]

The European Commission Directorate – General for Health & Consumers
organized the European Consumer Summit on “Consumer Trust in the Digital
Market Place” held in Brussels on 1 and 2 April, 2009. The agenda featured
policy workshops on ‘Consumer challenges and opportunities in the digital
world’ and ‘Consumer advocacy’. Within the first topic, the whole range of
consumer concerns in the digital market place considered to be major
obstacles to the full take-off of business to consumer e-commerce and
possible solutions to create consumer trust were discussed. Thematically,
the topic of consumer data collection, profiling and targeting was arching
out pointing to the heavy reliance on personal information in the digital
environment; something which captured policy makers’ attention in Europe
fairly recently.

In a preceding ‘Roundtable on Online Data Collection, Targeting and
Profiling’ hosted by the Directorate-General for Health & Consumers on 31
March experts and stakeholders’ input had been generated in order to feed
back into the main event. In her key note speech Commissioner Meglena Kuvena
observed that “personal data is the new oil of the Internet and the currency
of the digital world” – a reality to be accepted in exchange for free
content online. However, well established consumer protection principles,
including the applicable data protection regulations, are not fully complied
with in the “World Wide Web (…) turning out to be the world ‘wild west’.”

In order to reassert the confidence of the users and consumers, Mrs. Kuneva
sees privacy policies as the key to implement fairness and transparency
standards as well as meaningful consumer control. Her message to the
participants of the roundtable showed determination to enforce existing
regulation on the Internet and to regulate where adequate response to
consumer concerns on the issue of data collection and profiling is missing.

The roundtable proceeded with contributions from industry, lobbies and
consumer organizations as well as academics discussing the data collection
practices and business models as well as risks and opportunities for
consumers. The business model to (co)finance content and free services with
online advertisement that incorporates to a varying degree targeted
information and personal data is certainly pervasive also beyond gratis
offers. It is important however to tell apart the numerous online
advertising practices and assess whether and to what extent personal
information of users is involved. Companies and industry associations favour
good practice principles and self-regulation, and, inevitably, see consumer
control implemented with the opt-out mechanism. According to this spectrum,
users are empowered individually to control the use of their personal
information and collectively through the lever of brand value that would
caution companies. Critical interventions raised the need for special
protection of sensitive segments such as children and sensitive personal
data, a state of fairness in privacy policies and consent generation, and
the problem of multi-layered and networked data collection, leaving the user
largely unaware of who controls which personal information. Consumer
education about online advertising and the meaning of privacy policies and
consent emerged as a consensus from the discussion.

Member of European Parliament Stavros Lambrinidis, rapporteur of the
recent report on strengthening security and fundamental freedoms on the
Internet, stressed the necessity to prescribe limits to the ‘consent’ that
can be obtained from users regarding the processing of their personal data
in the digital marketplace. As reflected in his report, the imbalance of
negotiating power and knowledge between individual users and data
processing industry and authorities bears the risk that “Big Brother” will
come stealthily and with our “consent”.

In the progress of the European Consumer Summit behavioral advertisement and
its consumer policy implications were prominently raised and wrapped up,
asking for:

a. the evaluation of different online advertising practices,
b. ways to improve consumer control and information,
c. the role and robustness of standards and best practices, and
d. how the fairness concept can be best transposed from offline to online.

In order to keep a channel for discussion open, the Directorate-General for
Health & Consumers proposed to set up a privacy blog on its webpage and
invited comments. The way forward was not specified and is further
complicated by the fact that online consumer data protection is situated at
the intersection of the tasks of three Directorates – General: Health and
Consumers, Freedom Security and Justice, and Information Society and Media.

In the U.S., the Federal Trade Commission (FTC) examined online behavioral
advertisement to some length and published in February 2009 a Staff Report
on Self-Regulatory Principles for Online Behavioral Advertising.

Meglena Kuneva, European Consumer Commissioner, Keynote Speech (31.03.2009)

Report with a proposal for a European Parliament recommendation to the
Council on strengthening security and fundamental freedoms on the Internet

FTC Staff Report on Self-Regulatory Principles for Online Behavioral
Advertising (12.02.2009)

Center for Democracy & Technology, A Guide to Behavioral Advertising

Center for Democracy & Technology, Threshold Analysis for Online Advertising
Practices (28.01.2009)

Internet Governance Forum (IGF), Workshop 83: The Future of Online Privacy:
“Online advertising and behavioral targeting” (5.12.2008)

(contribution by Kristina Irion – Center for Media and Communications
Studies(CMCS – at Central European University)