International coalition calls for action against surveillance-based advertising

Every day, consumers are exposed to extensive commercial surveillance online. This leads to manipulation, fraud, discrimination and privacy violations. Information about what people like, their purchases, mental and physical health, sexual orientation, location and political views are collected, combined and used under the guise of targeting advertising.

In a new report, the Norwegian Consumer Council (NCC) sheds light on the negative consequences that this commercial surveillance has on consumers and society. The NCC together with other organizations and experts, including the Għaqda tal-Konsumaturi, is asking authorities on both sides of the Atlantic to consider a ban. In Europe, the upcoming Digital Services Act can lay the legal framework to do so. In the US, legislators should seize the opportunity to enact comprehensive privacy legislation that protects consumers.

The collection and combination of information not only violates one’s right to privacy, but renders a person vulnerable to manipulation, discrimination and fraud. This harms individuals and society as a whole, the director of digital policy in the NCC, Finn Myrstad, said.

In a Norwegian population survey conducted by YouGov on behalf of the NCC, consumers clearly state that they do not want commercial surveillance. Just one out of ten respondents were positive to commercial actors collecting personal information about them online, while only one out of five thought that ads based on personal information were acceptable.

“Most of us do not want to be spied on online, or receive ads based on tracking and profiling. These results mirror similar surveys from Europe and the United States, and should be a powerful signal to policymakers looking at how to better regulate the internet,” Myrstad said.

Significant consequences

The NCC report ‘Time to ban surveillance-based advertising’ exposes a variety of harmful consequences that surveillance-based advertising can have on individuals and on society.

1. Manipulation: Companies with comprehensive and intimate knowledge about people can shape their messages in attempts to reach them when they are susceptible, for example to influence elections or to advertise weight loss products, unhealthy food or gambling.
2. Discrimination: The opacity and automation of surveillance-based advertising systems increase the risk of discrimination, for example by excluding consumers based on income, gender, race, ethnicity or sexual orientation, location, or by making certain consumers pay more for products or services.
3. Misinformation:  The lack of control over where ads are shown can promote and finance false or malicious content. This also poses significant challenges to publishers and advertisers regarding revenue, reputational damage, and opaque supply chains.
4. Undermining competition:  The surveillance business model favours companies that collect and process information across different services and platforms. This makes it difficult for smaller actors to compete, and negatively impacts companies that respect consumer’ fundamental rights.
5. Security risks: When thousands of companies collect and process enormous amounts of personal data, the risk of identity theft, fraud and blackmail increases. This data collection has been classified by some as a national security risk.    
6. Privacy violations: The collection and use of personal data is happening with little or no control, both by large companies and by companies that are unknown to most consumers. Consumers have no way to know what data is collected, who the information is shared with, and how it may be used.

“It is very difficult to justify the negative consequences of this system. A ban will contribute to a healthier marketplace that helps protect individuals and society,” Myrstad said.

Good alternatives

In the report, the NCC points to alternative digital advertising models that do not depend on the surveillance of consumers, and that provide advertisers and publishers more oversight and control over where ads are displayed and which ads are being shown.

“It is possible to sell advertising space without basing it on intimate details about consumers. Solutions already exist to show ads in relevant contexts, or where consumers self-report what ads they want to see,” Myrstad said.

“A ban on surveillance-based advertising would also pave the way for a more transparent advertising marketplace, diminishing the need to share large parts of ad revenue with third parties such as data brokers. A level playing field would contribute to giving advertisers and content providers more control, and keep a larger share of the revenue.”