Published on 05/24/2022 by
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An Irish NGO has just published the results of a large-scale study on targeted advertising in real time on the Internet (real time bidding). The results are striking because the phenomenon is of considerable economic magnitude and importance. The study could contribute to unblocking the file of the new ePrivacy regulation.
A little riddle…
Americans do it 747 times a day on average; Europeans are at 376 times a day.
What is it about … ?
No, it’s not a question of some scabrous statistic, but of the number of daily confrontations of Internet users with the phenomenon of real time bidding (RTB) or real-time auctions.
RTB, acronym for real time bidding
Real-time bidding is a type of programmatic advertising (meaning, in essence, targeted advertising based on the person to whom the ad is shown, that person’s characteristics and interests, their location, the price and characteristics of the product or service, etc.).
The CNIL explains: “When a user consults a web page with advertising space, it is auctioned off to a set of potential buyers. The latter can consult information about the user and cross-reference it with the possible advertising profile they have on him to assess the interest in displaying an advertisement to his attention and therefore determine the price that they are possibly ready to pay. pay for it. The advertiser with the highest bid wins and can therefore display their ad to the user. This process typically takes a few hundred milliseconds. The technology is complex (notably due to the multiplicity of advertising networks and the number and diversity of intermediaries) for a principle that is quite simple after all.
In the real world, this would mean that every time a person walks past a billboard, it would change the advertisement offered depending on the person. The “characteristics” of this person (not necessarily a name but rather a profile) would be sent to different advertising agencies and each could, according to an auction system, propose an advertisement. These bids would be collected by the operator of the billboard who would decide to display the advertisement of his choice, probably the one offering the highest amount. If two people are in front of the same sign, they would not necessarily see the same advertisement.
A market worth 117 billion dollars
On the Internet, RTB is commonplace. It is even one of the fundamental economic models of so-called free sites and services.
The Irish Council for Civil Liberties (ICCL) is an Irish privacy NGO. It has just carried out and published the results of a survey relating to the extent of this phenomenon.
The study estimates that this market weighs more than 117 billion dollars.
Behind this market, there is a network of companies (site operators, advertising agencies, advertisers, etc.) which organize auctions 294 million million times a day in the USA, and 197 million million times a day in Europe, that is to say 747 times a day on average for an American and 376 times a day on average for a European. This difference is mainly due to the existence of the GDPR and European regulations on cookies.
In most cases, the geolocation of the visitor is collected.
It should however be emphasized that geolocation is a generic term behind which hides a multiple reality, and the Irish study does not allow us to go down to a level of granularity sufficient to measure these differences and their impact on privacy. Intrusion into privacy depends largely on the accuracy of geolocation, which can range from a few (tens of) kilometers (region, country, city) to a few (tens of) centimeters (precise address).
The factors that influence accuracy are numerous, including: the technology used (GSM, GPS, bluetooth, etc.), the service consulted (website, social network, cartography, etc.), the device on which the visitor is browsing ( PC, smartphone, tablet), the settings of the device and its operating system (iOS, Android, etc.), the type of connection (landline, shared wifi, mobile), the source of the data and their possible crossing with others, etc
Even within the mobile Internet, strong distinctions can appear: the operator of the telephone network generally only has an approximate location linked to the use of access points and antennas; the payment operator often knows the location of the point of sale used for the transaction but this information has only a limited lifetime (the payment time); the social network operator who has been authorized (consciously or not) to use the GPS location of the smartphone is able to track users, etc. We will therefore be careful not to mix things up as the diversity is so important.
Unsurprisingly, the most active company in this area is Google. The ICCL claims that 4,698 companies are authorized by Google to receive RTB data on people in the United States (This number would be 1,058 companies in Europe).
According to the study, data is transferred worldwide, including Russia and China.
ePrivacy is long overdue
The General Regulations on the Protection of Personal Data (GDPR) regulates, horizontally (all sectors), the protection of personal data.
Another equally important text is the privacy and electronic communications (e-privacy) directive of 2002, amended in 2009.
Unlike the GDPR, which is intended to be transversal (all sectors from the moment personal data is processed), the e-privacy directive is vertical (electronic communications for all data, personal or not). It contains in particular provisions relating to the following elements:
- network and service security;
- confidentiality of communications;
- access to stored data;
- cookies ;
- the processing of traffic and location data;
- calling line identification;
- public subscriber directories; and
- unsolicited commercial communications (“spam”).
The entry into force of the GDPR involved updating the e-privacy directive and replacing it with a regulation, but this project has been delayed due to political differences between member states.
After a 2017 proposal, the file suffered from blockages and delays.
The French presidency of the European Union had made it a priority and recently drafted a summary of the work and proposed a common position, but it is not yet known whether a regulation will soon be adopted.
The study published by the ICCL puts the question of cookies at the center of the political game and could contribute to unblocking the file.
More informations ?
By reading the results of the ICCL study.