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Guaranteeing data privacy with FTC regulations

FTC Regulations in a World of Big Data, Consumers, Advertisers, and TV

October 19th, 2016   ||    by Charlene Weisler   ||    No Comments

FTC regulations regarding consumer privacy are pivotal pieces of legislation. Television has increasingly come to rely on big datasets, with new initiatives by Viacom and Turner concerning their linear, addressable, and programmatic data platforms. Wherever big data is used, there’s an unspoken assumption that the industry will be privacy compliant, that the data is hashed, and that it’s only used to target consumers on an anonymous basis. But as companies gather ever more granular data that can be combined and modeled using machine learning, how close will targeting become to specific one-to-one marketing in television? And at that point, how much privacy can consumers expect?

Failing to Create Standards Creates Risk

Cooperation across companies to develop a data-privacy industry standard not only helps consumers—it helps businesses as well. In a recent article in AdExchanger, Brad Smith, SVP Revenue and Operations at Videa, noted, “Guidelines and best practices drive consistency and repeatability in systems and processes. It also preserves and improves the art of selling broadcast linear television advertising and the use of first- and third-party data overlays to better understand audience value. (It) establishes rules of engagement between marketplaces so demand and inventory are represented fairly.”

Some believe failing to form standards risks consumer backlash. “Vagueness impacts the consumer’s understanding of risk and their willingness to share information,” said Fordham University law professor Joel Reidenberg (in an AdExchanger piece) at a FTC workshop testing consumer disclosures and privacy policies. But others are not so convinced.

Allison Schiff, in AdExchanger, reported how policymakers at the FTC’s recent PrivacyCon expressed concerns that some consumers are grudgingly releasing their personal information in order to quickly access desired services, while others may misinterpret the privacy agreements they make with companies. “In the real world, people who exchange data for benefits are more likely to do it when they’re resigned, rather than as the result of a cost-benefit analysis,” Joseph Turow, a privacy researcher and professor of communication at the University of Pennsylvania, said.

The Future of Privacy

Companies dealing in TV merged with other data tend to have a standard reply when it comes to consumer data privacy, which explains that they use data in a privacy-compliant manner. Sometimes they rely on third-party referees, such as Experian, to anonymize the data and ensure privacy compliance.

Consumers don’t always seem to regard privacy as a great concern. Who hasn’t forfeited personal data in order to obtain a free service? Who isn’t aware that using a credit card means that information is then sold to a marketer? Who’s really surprised when, after a search for a product, pop-up ads appear for it or products like it? Once personal data is out there, it’s difficult to control how it’s used.

But consumer backlash could be coming. In an Internet of Things world, there will be more and more available datasets—cars and household appliances, for example—that capture a full range of consumer behavior. Privacy risks vary by industry and category. With pharma, for instance, unique data attributes that can target specific medical needs enable hypertargeting of ailments but run the risk (or give the appearance of risk) of privacy non-compliance.

As more and more television companies rely on data to propel their businesses, there is more at stake in guaranteeing and maintaining consumer privacy. Standards and boundaries must be set, whether mandated by FTC regulations or agreed upon by an industry consortium.

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