The General Data Protection Regulation is finally here. Earth has continued to rotate.
Despite a two-year grace period in which to prepare before enforcement of the law, most businesses have scrambled to get compliant in time for the May 25 deadline. In other words, it’s been a bit of a mess.
The law itself should be accountable for some of the blame: The bombardment of consent notices and requests for opt-ins or opt-outs over the last few weeks highlights just how broadly the law has been interpreted. The market is divided into those who have attempted to follow the spirit of the law to the letter, and those who have crossed their fingers and hoped for the best.
As with anything, there are winners and losers. Bluntly speaking, any business that doesn’t have a direct relationship with users is in for a difficult time.
It’s no secret Google’s GDPR approach has angered many in the digital advertising world, particularly publishers. Its decision to reveal its GDPR approach just weeks before the deadline, after publishers had spent the last year developing compliance strategies, has been met with iciness.
Google is not immune to GDPR pressure. The company has been under fire from Brussels for years and has a handsome collection of multibillion-dollar fines courtesy of behavior the European Commission has deemed anti-competitive. Its GDPR approach will likely be scrutinized in-depth, although whether individual-country regulators have the resources to take on a company with Google’s resources is another matter. Google will also likely be a core target of privacy activists.
Google is rightly being taken to task by the world’s biggest publishers. Regardless of its dominant market position, it will want to retain good relationships with the big publishers. In some cases, it will have to rely on publishers gaining consent on its behalf and can cut off third-party tech vendors that it deems noncompliant whenever it likes.
Regardless of size, it will take a brave publisher to cut off Google from its supply chain. Even the mighty Axel Springer, which has gone public about how it is weaning itself off relying on Google’s platforms, must still stay in the company’s good graces enough to be able to use its ad products, to sustain digital ad revenues.
Combined, Google’s core products DoubleClick Bid Manager, AdX, DoubleClick for Publishers and its attribution solution generate just under $5 billion net revenue, dwarfing its nearest competitors in each category, according to a recent post from U.S. publisher trade body Digital Content Next CEO Jason Kint. “Google both creates the market and makes the market,” he said.
There is widespread concern that Google has used GDPR as a cover to gain competitive benefits, such as restricting the DoubleClick ad ID to its own platform and restricting the number of ad tech vendors that publishers using its CMP can plug in. “Google regards GDPR as a strategic play,” said Jon Slade, chief commercial officer of the Financial Times.
Publishers with muscle
When it comes to GDPR, size matters. While larger, known brands are likely to attract the eyes of regulators and privacy activists, they’re also well-resourced. That means they have the funds for lawyers and to create their own technologies such as consent management systems, and they have enough clout to push back on the GDPR terms being dictated by dominant U.S. tech platforms like Google and Facebook.
European media powerhouses like Axel Springer will be in a strong position. The publisher had the resources to develop its own consent management platform that it has opened to other publishers to use as open source, and it has enough clout in the market to stand up to the platforms. It also, like many other premium publisher groups, has a sea of consumer brands that people recognize.
While most publishers can speak directly with users, either via email newsletters, sites, apps and other marketing messages, subscription publishers are clear winners. People are prepared to pay for their products and services. They needn’t harbor the fear on other publishers’ minds: that users may opt out or choose not to give consent. Therefore, they won’t have to worry about programmatic revenue deficits caused by a drop in the amount of audience data they can run advertising against. Publishers with registered users will also be in a strong position. Anyone that has logged in to use a media owner’s product has chosen to do so because they believe that product is worth it.
It isn’t for nothing that “ambulance chasers” has been the GDPR phrase du jour for some time. Overall, industry consensus is that in truth, everyone loses something — apart from the sea of lawyers who have been no doubt rubbing their hands in glee at the onslaught of business requests from terrified businesses.