What you need to know:

• Completing the ACCC's digital platforms inquiry before the Attorney-General's privacy overhaul could be a costly mistake, senior media and ad execs warn.
• It risks locking in big tech's market power while forcing smaller firms to pick up the tab.
• Meanwhile, they say regulators should outlaw things like "Gmail surveillance" being allowed to power ad platforms, while making sensible choices around consent for "non-harmful" practices like segmentation for targeted advertising.
• The ACCC should also be wary of platforms trying to subvert its plans around data portability to suit their "creative interpretations".
• Addressing "woefully inadequate" privacy law will allow regulators to then get to the heart of digital competition issues: data monopolies.

The Federal Government risks strengthening big tech’s stranglehold on Australia’s economy by pushing through digital regulation without first tackling privacy reforms, senior Australian media execs have warned.

They urge lawmakers to ensure the ACCC’s digital platforms review does not conclude before the Attorney-General’s overhaul of Australia’s privacy laws. While both are set to conclude this year, the ACCC’s inquiry is scheduled to finish first.

Failure to fully align both frameworks could result in a digital patchwork that will require a costly rebuild, leaving smaller companies to foot the bill while entrenching an already vast data advantage held by Google, Facebook and Amazon, according to executives from IPG Mediabrands, Guardian Australia and the IAB.

“The ACCC has done an amazing job of identifying the two main issues that exist within the advertising digital advertising supply chain. Firstly, that it is way too opaque, and secondly that Google is really dominant,” said Guardian Australia MD, Dan Stinton.

However, he said there is a conflict at the heart of the ACCC’s mission.

“You have a report which is calling for more transparency in the advertising supply chain, but at the same time, that risks infringing on consumer privacy,” he told Mi3’s latest podcast.  

“So the [digital platforms] report needs be viewed at the same time as the Attorney-General’s review of Australia’s privacy laws – because they are woefully inadequate for the digital world we live in.”

Don’t repeat GDPR mistakes

Stinton warned lawmakers to be wary of unintentionally ceding more power to the platforms, as has been seen in Europe with GDPR, where the burden of compliance is disproportionately high on those with least resource.

He also urged regulators not to emulate GDPR’s approach to consent – whereby every website visit results in people having to submit data collection preferences, with opt-outs often laborious.

Stinton described that as a “fundamental failing”, while regulators had effectively handed the big data aggregators a free pass.

“In those circumstances, consumers get banner blindness and just consent to everything without realising what they are consenting to. Ultimately, that just benefits the biggest players with the largest properties and audiences,” he said.

Gmail surveillance bad, segmentation good?

Stinton urged regulators to limit the kinds of data that can be used for advertising purposes – without curbing approaches that do not harm consumers. That approach could reduce the risk of an unworkable consent framework, he suggested.

“In Australia, we need to put purpose limitations around what data can be aggregated. For example, there needs to be limitations on Google's ability to aggregate data they collect from surveillance of Gmail and using that to power their targeted advertising business,” suggested Stinton. “Irrespective of consent, that should be outlawed.”

He also called for guidelines around acceptable targeted advertising.

“There should be clear boundaries about what is okay – because I don't think there are harms in putting consumers into different segments for the purposes of targeted advertising. Therefore, I don’t know why you should have to require consent for that in the first place," said Stinton.

“Those boundaries are key to the implementation of a privacy regime which works in Australia, and subsequently putting the right policies in place to ensure that the adtech supply chain operates efficiently as well.”

Don’t let platforms subvert regulation

UM Chief Digital Officer and Global Brand Safety Officer, Joshua Lowcock, agreed privacy reform must inform the ACCC’s curbing of big tech’s almost total market power.

“You need to bridge the two [reviews],” he said. “You cannot let privacy be the veil to prevent regulatory reform and competition reform.”

Lowcock also raised concerns that platforms will attempt to subvert regulatory intent over data portability, one of the key proposals being taken forward by the ACCC.

The platforms, he said, are already applying “creative interpretations” to data portability. He thinks that they may be trying to shape regulation so that consumer data portability is seen as effectively the same thing as enabling competition within advertising ecosystems.

“We know from the way that networks effects work, that people moving their data from one platform [to another] just doesn’t work that way,” he said.

Only by aligning both reviews can regulators get to the heart of the competition issue, which is data.

“Platforms that don’t have scale of data struggle to compete in the ecosystem,” added Lowcock.

Get it wrong, pay the price

Failure to align regulation could result in big costs for industry, and therefore consumers, warned IAB chief executive, Gai Le Roy.

“The timing is interesting, because if we're going to have a final report while the Attorney-General is still looking at the privacy review, you don't want to put things in place that then will have to be untangled down the track.”

Le Roy hopes the ACCC will build on work being undertaken globally as states try to regulate data and algorithms and create fit for purpose privacy regimes.

“Hopefully we will have some policy that is consistent [globally] where it makes sense. So advertisers, publishers and tech agencies don't have to reinvent the wheel in every area,” said Le Roy.

The alternative is “an inefficient system that leads to great expense in re-architecting something down the line”.

You can get the bigger picture with views from MFA Chair Megan Brownlow and Omnicom Media Group investment chief Kristiaan Kroon via Mi3’s latest podcast here.