Digital Updates – April

Nearly two years ago, the EU enacted the General Data Protection Regulation (GDPR), which was the world’s strictest online privacy regulation. Since its enactment, Google has been the only company fined under the law, making many question its effectiveness. CEO of advertising company WPP said that GDPR empowered big tech companies rather than limited them, because the law gave them “the ability to collect and process the data,” as reported by the Wall Street Journal. Many believe this lack of enforcement is due to European governments not providing adequate resources to data protection agencies. In a survey of European privacy regulators, 70 percent of those surveyed reported having inadequate resources. Because of Europe’s lack of enforcement under the GDPR, it could undermine other efforts around the world to hold big tech accountable for privacy breaches. Read more here.

Since September 2019, Texas Attorney General, Ken Paxton, has led a group of attorneys general across the country in an investigation into Google for potential antitrust violations. Specifically, the attorneys general are scrutinizing Google’s level of control and anticompetitive behavior in the online advertising and search traffic markets. On April 22, 2020, AG Paxton spoke at an event held by the American Bar Association’s Antitrust Law Section. He reiterated his belief that federal, state, and local regulations of Big Tech companies are necessary to protect consumers.  He also said that the COVID-19 pandemic has not slowed down the attorneys’ general investigation into Google. Read more here.

On April 28, the News Media Alliance joined a group of creative-industry organizations to publish comments on the proposed trade agreement between the United States and the United Kingdom. The comments outline the importance of the copyright-intensive industries to the economies of both countries and lays out the priorities of these communities for the negotiations. The priorities include keeping any potential copyright safe harbor provisions “short and high-level” without detailed obligations, ensuring that these provisions are not affected by other third-party liability provisions that are under review in both countries, and extending the copyright term in the United States to meet that in the United States. The letter also calls out for strong copyright enforcement and national treatment provisions, in addition to reiterating the willingness of the signatories to work constructively with both governments during the negotiations. Read the full comments here.

On April 23, the U.S. District Court for the District of Columbia upheld the settlement reached last July for sanctions brought by the FTC against Facebook for privacy violations that have spanned nearly eight years. Judge Timothy Kelly upheld the largest penalty ever won by the FTC, but the settlement also requires Facebook to take additional measures to protect users’ personal information. The opinion lists 11 different remedial steps Facebook must take, including “clearly disclosing” any time it shares personal information  with third parties and obtaining express consent, ceasing “a host of” misrepresentations about its collection and use of users’ personal information, and creating a committee, independent of Facebook’s board of directors to oversee the implementation of the new privacy efforts. Read more here.

On April 23, 2020, several Google and Facebook representatives participated in an every-other-week video conference hosted by the Privacy Community Group (PCG) of the World Wide Web Consortium (W3C). This marks Google’s first appearance at a PCG conference as a member of the group. The discussion focused mainly on a proposal called “Registry of Businesses and Domain Name Ownership,” which would create an authority with whom businesses could register as trusted owners of user data, include which legal requirements they follow (e.g., GDPR, CPAA, etc.), and identify third-parties with whom the business has contracted. Browsers could consult this list before sharing an individual user’s cross-site browsing activity. Read more here.

On April 20, 2020, the Australian government directed the Australian Competition and Consumer Commission (ACCC) to develop a mandatory code governing the commercial relationship between digital platforms and media outlets.  This code will address the sharing of data, ranking and display of news content, monetization and sharing of revenue generated from news, and dispute resolution mechanisms.  ACCC will release a draft mandatory code by the end of July 2020.  This decision follows findings of disparate bargaining power between digital platforms and media outlets in ACCC’s Digital Platforms Inquiry final report, the Australian government had instructed ACCC in December 2019 to facilitate negotiations between the two industries for the development of a voluntary code.  These negotiations were expected to last until November 2020.  Due to the media sector’s financial strain exacerbated by COVID-19 and ACCC’s belief that a voluntary agreement is unlikely, the Australian government instead enjoined ACCC’s development of a mandatory code.  Australia’s Treasurer, Josh Frydenberg, stated the government’s belief that a mandatory code “is critical for the future viability of [the Australian] media sector and it’s all about competition and creating a level playing field.”

Traffic to news sites has spiked in recent weeks due to the COVID pandemic; however, news publishers have not seen a financial benefit. Overzealous blacklisting – based on unjustified fears that news stories don’t meet brand safety guidelines – has led to a decrease in digital ad revenues just when publishers are investing resources in meeting their communities’ needs.

Support for ad placement with news publishers has come from the ad industry association — the 4A’s released a report pointing out that “trusted news content is brand safe” and encouraged its members to support news. The Interactive Advertising Bureau (IAB), which focuses on online advertising, specifically called on its members to not block news, citing the public health benefits of supporting journalism. The Local Media Consortium and the Brand Safety Institute partnered to create a whitelist of local news sites for advertisers to include in their digital buys. And the advertising technology companies MediaMath and TRUSTX partnered with each other and data provider Peer 39 to ensure their clients understand how continuing to place their ads near brand suitable news can help them reach the right audiences while supporting the important work of journalism.  The Alliance will continue to push for a solution to prevent the news industry from seeing continuing declines in ad revenue.

On April 19, the Wall Street Journal reported that OpenSlate, a brand safety company, refused to sign a contract with Google after being an approved partner since 2017. The contract would allegedly limit OpenSlate’s ability to report to clients when their ads play in YouTube videos with sensitive subject matter like “hate speech, adult content, children’s content, profanity, violence and illegal substances.” The contract would require OpenSlate to get prior approval from Google to share these metrics with its clients. One of Google’s brand-safety partners, DoubleVerify reported that it still delivers “unrestricted” reports to its clients. This news follows a universal ad decline amid the COVID-19 crisis, and tech companies scramble to continue monetizing content. Read more here.

As America works to meet the needs brought on by COVID-19, tech companies have coordinated with the government to find effective responses to the crisis. But people’s newfound appreciation and trust in big tech will likely be short lived. Statistics about regional differences in social distancing can be useful for public health experts and interesting to the general public today, but information like this can make users increasingly concerned about their privacy and big tech’s use of their data tomorrow. Similarly, the online platforms’ role in choosing what people see and vetting information can help distribute reliable information during a crisis but threatens the sustainability of and access to high-quality journalism at other times. As big tech enjoys a rare bout of positive press, Attorney General William Barr was quick to confirm that he plans to make a decision about the antitrust inquiries into the tech industry by early summer. Read more here.

On April 9, the French competition regulator, Autorité de la Concurrence, issued an interim decision requiring Google to pay for news content under the recently implemented European Union Copyright Directive. Article 15 of the Directive requires EU Member States to create a so-called Publishers’ Right that allows news publishers to protect their content online by preventing uncompensated use by online platforms. The competition regulator’s decision, finding that Google has likely engaged in anticompetitive behavior, came after a group of French publishers filed a complaint with the authority due to Google’s refusal to pay for news content following France’s transposition of the Publishers’ Right into national law last year. The decision requires Google to engage in good faith negotiations and reach a remuneration deal with French publishers within three months, among other conditions. The decision is an interim measure while the authority continues its investigation into the merits of the case. Read the decision here (in French).