Hot Takes: The Banning Surveillance Advertising Act

Last week, Senator Cory Booker (D-NJ) and Representatives Anna Eshoo (D-CA) and Jan Schakowsky (D-IL) introduced the Banning Surveillance Advertising Act, a wide-ranging piece of privacy legislation that would seek to prohibit advertising networks and facilitators from using personal data to target advertisements, with the exception of broad location targeting (e.g., targeting specific zip codes or municipalities.) The bill also prohibits advertisers from targeting ads based on protected class information, such as race, gender, and religion, and from using personal data purchased from data brokers.

The bill was predictably not well received by members of the digital advertising community, with the IAB slamming the “devastating effects” the bill would have on the digital advertising industry.

Reaction was less severe in the television industry, where many observers thought the industry might actually be able to benefit from stricter privacy rules.

While TVREV Thought Leaders Circle had a variety of opinions on the potential fallout of the bill, one universal comment was that the bill is just a proposal, an opening volley in the upcoming privacy wars, if you will and that much would likely change before (and if) it became a law.

Nick Cicero, Vice President of Strategy at Conviva, focused on the need for publishers to have a first party data strategy based on transparency and privacy compliant solutions.

It’s time for publishers to figure out their first party data strategy and establish measurement independence. If they are relying on data collected by third parties, they are investing in a solution that is under attack and aren’t future proofing their business. A successful first-party data strategy requires trust and transparency, making consent a critical part of this new value exchange. In order to regain trust with consumers and continue to foster this data exchange, publishers need to look at audience measurement and analytics solutions such as Conviva, that are privacy-compliant and don’t rely on collecting and tracking things such as device IDs.

Michael Tuminello, Vice President, Strategy at Mediaocean looked at the key reasons why the TV industry was unlikely to suffer the same repercussions from the proposed bill as players like Google and Facebook, while advocating for a more transparent system that served the needs of buyers, sellers and consumers equally.

I’m not sure which is more dramatic – the name of the Banning Surveillance Advertising Act, or its potential impact on the TV industry, but it’s probably the former. The bulk of TV and video advertising is not specifically targeted, and marketers can get a long way toward audience targeting with geographic and content signals alone, if it comes to that. In addition, the emerging major players in streaming TV – TV OS owners like Samsung, platforms like Roku, and content giants like NBCU and Disney – would likely operate under less scrutiny than the historical tech giants even under the law.  There are a number of reasons for this:

•  There is a lot more competition in the TV space compared to the couple of players dominating online advertising.

•  TV advertising will be harder to police.

•  Many TV providers have paid subscribers. They can dial back plans to profit off of audience data as needed.

•  TV ads are more expensive and harder to buy.

The newly recognized need to protect society as a whole from negatively impactful uses of consumer data is one of many reasons that the next generation of adtech needs to be defined by solutions that are built to serve buyers, sellers, and consumers. Such coordination will be needed to serve the needs and protect the interests of all three constituencies.  We believe Mediaocean is in a unique position to build the required media-neutral infrastructure that supports the consolidation of a too-fragmented ecosystem, as well as the required transparency to ensure the industry can put accountability on an equal footing with economic success.

Field Garthwaite, CEO of IRIS.TV, spoke to why contextual advertising, which the proposed bill specially deems acceptable, is so important to the future of TV advertising and the infrastructure changes needed to allow it to scale.

The Banning of Surveillance Advertising Act is unprecedented legislation. Although the law is unlikely to pass as written today, it is another wake up call for the industry to take action to prepare for the end of cookies and prepare for increased protections around consumer privacy. The bill specifically calls out contextual advertising as acceptable. For video and Connected TV, contextual targeting based on data inside the video (instead of scraping web pages) is still new. Leading data companies like GumGum, Oracle, and Comscore have all invested in AI to make this signal available for CTV, but to make it available at the scale buyers need requires new infrastructure for onboarding and activation, like LiveRamp in the identity space. Buyers are prioritizing video-level contextual targeting—not only because it is a future proof approach, but because it enhances performance. Reaching consumers at the exact moment the ad is relevant to them is proven to drive higher engagement, recall, and sales lift and that is a growth opportunity for all marketers.

Raf Bagdassarian, Paket Media’s Founder, disagreed with the fact that the bill seemed to tar all forms of targeting with the same brush while noting that it may result in ads that are more closely tied to content, e.g., contextual advertising.

Ultimately, this seems to be a one-size-fits-all piece of legislation which will be overkill for “benign” consumer goods (entertainment, toilet cleaners, etc.) and not nearly harsh enough against those using ad networks for more harmful purposes such as insurrection or spreading misinformation. I’m curious to know if, and to what extent, user experience was considered prior to the drafting of the legislation, especially as such targeting is not all bad, and, if done right, can lead to a far superior ad experience for end users. Seems like we may be throwing the baby out with the bath water;

That said, Paket Media can help advertisers navigate this bill by establishing a search/discovery/billing ecosystem focused exclusively on entertainment and using that ecosystem to power content and ad recommendations. Perhaps this is the future: more niche platforms offering tangible user benefits that promote similarly situated products so as to be clear about the kinds of advertising a user of such a service will be seeing. In many ways it will be similar to the early days of television advertising where the ads were inextricably tied to content. This may not be a bad thing, as it opens up new opportunities for creative storytelling that brands can take advantage of.

Our TVREV take is that the bill is meant to highlight some of the more egregious privacy violations that vendors like Google and Facebook routinely engage in (scanning email) while taking advantage of the national mood that paints Big Tech as evil.

The television industry is largely immune from this, as targeted TV advertising, or CTV advertising, to be exact, is still in its nascency. That said, the industry needs to be conscious (and conscientious) about transparency and choosing solutions that do not raise potential privacy concerns. Contextual advertising seems to be an excellent vehicle for this, targeting the types of consumers who watch certain genres of programming, rather than the consumers themselves.

To wit, a recent study from Hub Research noted that consumers felt that targeted advertising on Discovery+ was less bothersome than on other platforms. Our suspicion is that is because Discovery’s home and food themed shows attract advertisers whose products are aligned with that sort of content, and so everything feels of a piece.

One final note: whatever happens to this particular bill, you can be sure that this will not be the last attempt to more strictly police the online advertising industry.