Data as Digital Assets: The Case of Targeted Advertising

Facilitated by the growth of cloud computing, artificial intelligence (e.g. machine learning), and big data (e.g. predictive analytics), new tracking and profiling techniques have been developed. They have enabled the rise of targeted advertising, that is the provision of advertisements tailored to the tastes and habits of the user who actually views them. If targeted advertising is effective, data protection laws still apply. Most regulations look at the phenomenon from the data protection perspective, whilst in this paper it is argued that a holistic approach should be sought. Indeed, intellectual property, competition law, and consumer protection come necessarily into play. A general idea in this paper is that one should treat the data as digital assets in the users’ IP portfolio, thus leading the users to care more about the way their data are processed, shared, and sold. The starting point is the regulatory framework in Europe, with particular regard to the ePrivacy Directive. After critically analysing some international and European self-regulatory initiatives, case studies on Facebook and the use of data on sexual orientation will be presented to display how these systems work in practice if an Italian user files a claim with the Istituto di Autodisciplina Pubblicitaria that his rights have been violated. The chapter goes on to compare the Data Protection Directive and the General Data Protection Regulation, with a focus on direct marketing. Given that Google is the main actor of the targeted advertising world, it will be explained how the platform works and this work analyses its privacy policy to assess how data are treated with regard to this form of advertising. Before concluding, the chapter looks at targeted advertising from an intellectual property and competition law perspective. The chosen prism is the Facebook / WhatsApp concentration. The paper aims inter alia to evaluate whether the decision of the Commission, which authorised the concentration, would be different today, in light of the change in WhatsApp’s privacy policy allowing the use by Facebook of certain data of WhatsApp’s users. The chapter assesses, more generally, whether targeted advertising can be prevented or somehow regulated through the unfair commercial practices regime. This chapter concludes with a pragmatic proposal which aims to empower the users, yet strike a balance between their interests and rights and those of the ad networks, publishers, and advertisers (advertising companies). In general, one should recognise that the opt-in regime required by some regulators is not implemented by the targeted advertising companies; cumbersome regimes such as the notice and consent provided for by the ePrivacy Directive have been a failure. Therefore, one should impose on businesses a more reasonable opt-out mechanism, provided that the right to dissent is actually enforced (as opposed to the current practice of circumventing adblockers and similar tools) and that the information is clear, brief, and provided in an interactive and gamified way. The user has to be at the centre of the system, but data protection rules may not be the best means therefor.