Superstitial - Regulation - Privacy and Data Collection

Privacy and Data Collection

Privacy regulation can require users’ consent before an advertiser can track the user or communicate with the user. However, affirmative consent (“opt in”) can be difficult and expensive to obtain. Industry participants often prefer other regulatory schemes.

Different jurisdictions have taken different approaches to privacy issues with advertising. The United States has specific restrictions on online tracking of children in the Children's Online Privacy Protection Act (COPPA), and the FTC has recently expanded its interpretation of COPPA to include requiring ad networks to obtain parental consent before knowingly tracking kids. Otherwise, the U.S. Federal Trade Commission frequently supports industry self-regulation, although increasingly it has been undertaking enforcement actions related to online privacy and security. The FTC has also been pushing for industry consensus about a Do Not Track solution.

In contrast, the European Union’s “Privacy and Electronic Communications Directive” restricts websites’ ability to use consumer data much more comprehensively. The EU limitations restrict targeting by online advertisers; researchers have estimated online advertising effectiveness decreases on average by around 65% in Europe relative to the rest of the world.

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