Home PublicationsCommentary How “Privacy Capitalism” Is Taking Over European Policy Debates

How “Privacy Capitalism” Is Taking Over European Policy Debates

by Daniel Castro

This article is part of a three-part series investigating the role of “privacy capitalism” in shaping the EU proposal to ban targeted advertising: 

A chorus of voices in European politics have started echoing a common refrain: using personal data for targeted advertising tramples consumer rights and harms society and the only way to stop this injustice is to ban these types of ads. But those pushing for a ban are not the altruistic digital saviors they portray themselves to be. Instead, many of them have direct financial interests in creating a regulatory system that forces businesses to adopt their business model, even if it comes at the expense of consumer welfare.

Animating the motivation to ban targeted ads are concerns about “surveillance capitalism”—a term coined by Harvard Business School professor Shoshana Zuboff to describe the various alleged threats to individuals and society from businesses monetizing the collection and use of personal data. According to this perspective, powerful companies use data and algorithms to manipulate consumers and subvert democracy, and it is up to the enlightened few to cancel this system of control. Hence their desire to ban targeted advertising as a way to eliminate the incentive to collect data.

But a key part of their argument is that banning targeted ads does not have to come at the expense of digital innovation. As Zuboff has said, “It’s impossible to imagine surveillance capitalism without the digital, but it’s easy to imagine the digital without surveillance capitalism.” When experts cast doubt on these claims, pointing out that revenue from targeted ads support the vast array of free content and services on the Internet, those advocating for a ban argue that anyone defending the status quo is just a shill for Big Tech. However, a closer look at their claims, and who is making them, shows not only a web of faulty arguments and flimsy evidence, but the emergence of “privacy capitalism”—a carefully coordinated campaign by certain players within the advertising industry to exploit consumer privacy concerns to enact rent-seeking regulations that would boost their business models at the expense of consumer welfare.

This three-part series shows that many of the groups pushing for a ban on targeted advertising are mostly citing the same evidence, and that evidence has serious flaws. Moreover, many of the groups lobbying for a ban purport to be objective or represent civil society, but often have direct financial ties to corporations with a financial stake in specific policy outcomes. Finally, those who want to stop targeted advertising should turn their focus inward, as many of the groups pushing for a ban are themselves using targeted ads.

Those advocating for a ban on targeted advertising typically try to discredit organizations with opposing viewpoints by declaring them to be in the pocket of Big Tech rather than engaging with the facts. To be clear, the problem is not that the groups lobbying for a ban on targeted ads get money from companies. My think tank receives funding from various tech companies too (we disclose our list of supporters on our website), and it is possible to receive corporate funds and still produce objective and trustworthy research. The problem is that many of the groups pushing for a ban on targeted advertising claim they are only representing civil society while not fully disclosing their ties to corporate interests that stand to profit from such a ban even as it hurts consumers. Moreover, much of the evidence these groups present to justify the ban is fundamentally flawed and sourced from unverifiable data coming directly from the companies with a financial interest in banning targeted ads from their competitors. That’s privacy capitalism in action.

Next: No, Contextual Advertising Is Not a Substitute for Targeted Advertising

Image Credit: Sammy Williams on Unsplash

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