In The Big Short, investor Michael Burry says “One hallmark of mania is the rapid rise in the incidence and complexity of fraud.” (Burry shorted the mania- and fraud-filled subprime mortgage market and made a mint in the process.)

One would be equally smart to bet against the mania for the tracking-based form of advertising called adtech.

Since tracking people took off in the late ’00s, adtech has grown to become a four-dimensional shell game played by hundreds (or, if you include martech, thousands) of companies, none of which can see the whole mess, or can control the fraud, malware and other forms of bad acting that thrive in the midst of it.

And that’s on top of the main problem: tracking people without their knowledge, approval or a court order is just flat-out wrong. The fact that it can be done is no excuse. Nor is the monstrous sum of money made by it.

Without adtech, the EU’s GDPR (General Data Protection Regulation) would never have happened. But the GDPR did happen, and as a result websites all over the world are suddenly posting notices about their changed privacy policies, use of cookies, and opt-in choices for “relevant” or “interest-based” (translation: tracking-based) advertising. Email lists are doing the same kinds of things.

“Sunrise day” for the GDPR is 25 May. That’s when the EU can start smacking fines on violators.

Simply put, your site or service is a violator if it extracts or processes personal data without personal permission. Real permission, that is. You know, where you specifically say “Hell yeah, I wanna be tracked everywhere.”

Of course what I just said greatly simplifies what the GDPR actually utters, in bureaucratic legalese. The GDPR is also full of loopholes only snakes can thread; but the spirit of the law is clear, and the snakes will be easy to shame, even if they don’t get fined. (And legitimate interest—an actual loophole in the GDPR, may prove hard to claim.)

Toward the aftermath, the main question is What will be left of advertising—and what it supports—after the adtech bubble pops?

Answers require knowing the differences between advertising and adtech, which I liken to wheat and chaff.

First, advertising:

    1. Advertising isn’t personal, and doesn’t have to be. In fact, knowing it’s not personal is an advantage for advertisers. Consumers don’t wonder what the hell an ad is doing where it is, who put it there, or why.
    2. Advertising makes brands. Nearly all the brands you know were burned into your brain by advertising. In fact the term branding was borrowed by advertising from the cattle business. (Specifically by Procter and Gamble in the early 1930s.)
    3. Advertising carries an economic signal. Meaning that it shows a company can afford to advertise. Tracking-based advertising can’t do that. (For more on this, read Don Marti, starting here.)
    4. Advertising sponsors media, and those paid by media. All the big pro sports salaries are paid by advertising that sponsors game broadcasts. For lack of sponsorship, media—especially publishers—are hurting. @WaltMossberg learned why on a conference stage when an ad agency guy said the agency’s ads wouldn’t sponsor Walt’s new publication, recode. Walt: “I asked him if that meant he’d be placing ads on our fledgling site. He said yes, he’d do that for a little while. And then, after the cookies he placed on Recode helped him to track our desirable audience around the web, his agency would begin removing the ads and placing them on cheaper sites our readers also happened to visit. In other words, our quality journalism was, to him, nothing more than a lead generator for target-rich readers, and would ultimately benefit sites that might care less about quality.” With friends like that, who needs enemies?

Second, Adtech:

    1. Adtech is built to undermine the brand value of all the media it uses, because it cares about eyeballs more than media, and it causes negative associations with brands. Consider this: perhaps a $trillion or more has been spent on adtech, and not one brand known to the world has been made by it. (Bob Hoffman, aka the Ad Contrarian, is required reading on this.)
    2. Adtech wants to be personal. That’s why it’s tracking-based. Though its enthusiasts call it “interest-based,” “relevant” and other harmless-sounding euphemisms, it relies on tracking people. In fact it can’t exist without tracking people. (Note: while all adtech is programmatic, not all programmatic advertising is adtech. In other words, programmatic advertising doesn’t have to be based on tracking people. Same goes for interactive. Programmatic and interactive advertising will both survive the adtech crash.)
    3. Adtech spies on people and violates their privacy. By design. Never mind that you and your browser or app are anonymized. The ads are still for your eyeballs, and correlations can be made.
    4. Adtech is full of fraud and a vector for malware. @ACFou is required reading on this.
    5. Adtech incentivizes publications to prioritize “content generation” over journalism. More here and here.
    6. Intermediators take most of what’s spent on adtech. Bob Hoffman does a great job showing how as little as 3¢ of a dollar spent on adtech actually makes an “impression. The most generous number I’ve seen is 12¢. (When I was in the ad agency business, back in the last millennium, clients complained about our 15% take. Media our clients bought got 85%.)
    7. Adtech gives fake news a business model, because fake news is easier to produce than the real kind, and adtech will pay anybody a bounty for hauling in eyeballs.
    8. Adtech incentivizes hate speech and tribalism by giving both—and the platforms that host them—a business model too.
    9. Adtech relies on misdirection. See, adtech looks like advertising, and is called advertising; but it’s really direct marketing, which is descended from junk mail and a cousin of spam. Because of that misdirection, brands think they’re placing ads in media, while the systems they hire are actually chasing eyeballs to anywhere. (Pro tip: if somebody says every ad needs to “perform,” or that the purpose of advertising is “to get the right message to the right person at the right time,” they’re actually talking about direct marketing, not advertising. For more on this, read Rethinking John Wanamaker.)
    10. Compared to advertising, adtech is ugly. Look up best ads of all time. One of the top results is for the American Advertising Awards. The latest winners they’ve posted are the Best in Show for 2016. Tops there is an Allstate “Interactive/Online” ad pranking a couple at a ball game. Over-exposure of their lives online leads that well-branded “Mayhem” guy to invade and trash their house. In other words, it’s a brand ad about online surveillance.
    11. Adtech has caused the largest boycott in human history. By more than a year ago, 1.7+ billion human beings were already blocking ads online.

To get a sense of what will be left of adtech after GDPR Sunrise Day, start by reading a pair of articles in AdExchanger by @JamesHercher. The first reports on the Transparency and Consent Framework published by IAB Europe. The second reports on how Google is pretty much ignoring that framework and going direct with their own way of obtaining consent to tracking:

Google’s and other consent-gathering solutions are basically a series of pop-up notifications that provide a mechanism for publishers to provide clear disclosure and consent in accordance with data regulations.

Specifically,

The Google consent interface greets site visitors with a request to use data to tailor advertising, with equally prominent “no” and “yes” buttons. If a reader declines to be tracked, he or she sees a notice saying the ads will be less relevant and asking to “agree” or go back to the previous page. According to a source, one research study on this type of opt-out mechanism led to opt-out rates of more than 70%.

Meaning only 30% of site visitors will consent to being tracked. So, say goodbye to 70% of adtech’s eyeball targets right there.

Google’s consent gathering system, dubbed “Funding Choices,” also screws most of the hundreds of other adtech intermediaries fighting for a hunk of what’s left of their market. Writes James, “It restricts the number of supply chain partners a publisher can share consent with to just 12 vendors, sources with knowledge of the product tell AdExchanger.”

And that’s not all:

Last week, Google alerted advertisers it would sharply limit use of the DoubleClick advertising ID, which brands and agencies used to pull log files from DoubleClick so campaigns could be cohesively measured across other ad servers, incentivizing buyers to consolidate spend on the Google stack.

Google also raised eyebrows last month with a new policy insisting that all DFP publishers grant it status as a data controller, giving Google the right to collect and use site data, whereas other online tech companies – mere data processors – can only receive limited data assigned to them by the publisher, i.e., the data controller.

This is also Google’s way of scraping off GDPR liability on publishers.

Publishers and adtech intermediaries can attempt to avoid Google by using Consent Management Platforms (CMPs), a new category of intermediary defined and described by IAB Europe’s Consent Management Framework. Writes James,

The IAB Europe and and IAB Tech Lab framework includes a list of registered vendors that publishers can pass consent to for data-driven advertising. The tech companies pay a one-time fee between $1,000 and $2,000 to join the vendor list, according to executives from three participating companies…Although now that the framework is live, the barriers to adoption are painfully real as well.

The CMP category is pretty bare at the moment, and it may be greeted with suspicion by some publishers.There are eight initial CMPs: two publisher tech companies with roots in ad-blocker solutions, Sourcepoint and Admiral, as well as the ad tech companies Quantcast and Conversant and a few blockchain-based advertising startups…

Digital Content Next, a trade group representing online news publishers, is advising publishers to reject the framework, which CEO Jason Kint said “doesn’t meet the letter or spirit of GDPR.” Only two publishers have publicly adopted the Consent and Transparency Framework, but they’re heavy hitters with blue-chip value in the market: Axel Springer, Europe’s largest digital media company, and the 180-year-old Schibsted Media, a respected newspaper publisher in Sweden and Norway.

In other words, good luck with that.

One big upside for IAB Europe is that its Framework contains open source code and an SDK. For a full unpacking of what’s there see the Consent String and Vendor List Format: Transparency & Consent Framework on GitHub and IAB Europe’s own FAQ. More about this shortly.

Meanwhile, the adtech business surely knows the sky is falling. The main question is how far.

One possibility is 95% of the way to zero. That outcome is suggested by results published in PageFair last October by Dr. Johnny Ryan (@JohnnyRyan) there. Here’s the most revealing graphic in the bunch:

Note that this wasn’t a survey of the general population. It was a survey of ad industry people: “300+ publishers, adtech, brands, and various others…” Pause for a moment and look at that chart again. Nearly all those proffesionals in the business would not accept what their businesses do to other human beings.

“However,” Johnny adds, “almost a third believe that users will consent if forced to do so by ‘tracking walls’, that deny access to a website unless a visitor agrees to be tracked. Tracking walls, however, are prohibited under Article 7 of the GDPR…”

Pretty cynical, no?

The good news for both advertising and publishing is that neither needs adtech. What’s more, people can signal what they want out of the sites they visit—and from the whole marketplace. In fact the Internet itself was designed for exactly that. The GDPR just made the market a lot more willing to start hearing clues from customers that have been laying in plain sight for almost twenty years.

The first clues that fully matter are the ones we—the individuals they’ve been calling “users,” will deliver. Look for details on that in another post.

Meanwhile::::

Pro tip #1: don’t bet against Google, except maybe in the short term, when sunrise will darken the whole adtech business.

Instead, bet against companies that stake their lives on tracking people, and doing that without the clear and explicit consent of the tracked. That’s most of the adtech “ecosystem” not called Google or Facebook.

Google can say it already has consent, and that it is also has legitimate interests in the personal data it harvests from us.

Google can also live without the tracking. Most of its income comes from AdWords—its search advertising business—which is far more guided by what visitors are searching for than by whatever Google knows about those visitors.

Google is also also highly trusted, as tech companies go. Its parent, Alphabet, is also increasingly diversified. Facebook, on the other hand, does stake its life on tracking people. (I say more about Facebook’s odds here.)

Pro tip #2: do bet on any business working for customers rather than sellers. Because signals of personal intent will produce many more positive outcomes in the digital marketplace than surveillance-fed guesswork by sellers ever could, even with the most advanced AI behind it.

For more on how that will work, read The Intention Economy: When Customers Take Charge. Six years after Harvard Business Review Press published that book, what it says will start to come true. Thank you, GDPR.

Pro tip #3: do bet on developers building tools that give each of us scale in dealing with the world’s companies and governments, because those are the tools businesses working for customers will rely on to scale up their successes as well.

What it comes down to is the need for better signaling between customers and companies than can ever be possible in today’s doomed tracking-fed guesswork system. (All the AI and ML in the world won’t be worth much if the whole point of it is to sell us shit.)

Think about what customers and companies want and need about each other: interests, intentions, competencies, locations, availabilities, reputations—and boundaries.

When customers can operate both privately and independently, we’ll get far better markets than today’s ethically bankrupt advertising and marketing system could ever give us.

Pro tip #4: do bet on publishers getting back to what worked since forever offline and hardly got a chance online: plain old brand advertising that carries both an economic and a creative signal, and actually sponsors the publication rather than using the publication as a way to gather eyeballs that can be advertised at anywhere. The oeuvres of Don Marti (@dmarti) and Bob Hoffman (the @AdContrarian) are thick with good advice about this. I’ve also written about it extensively in the list compiled at People vs. Adtech. Some samples, going back through time:

  1. An easy fix for a broken advertising system (12 October 2017 in Medium and in my blog)
  2. Without aligning incentives, we can’t kill fake news or save journalism (15 September 2017 in Medium)
  3. Let’s get some things straight about publishing and advertising (9 September 2017 and the same day in Medium)
  4. Good news for publishers and advertisers fearing the GDPR (3 September 2017 in ProjectVRM and 7 October in Medium).
  5. Markets are about more than marketing (2 September 2017 in Medium).
  6. Publishers’ and advertisers’ rights end at a browser’s front door (17 June 2017 in Medium). It updates one of the 2015 blog posts below.
  7. How to plug the publishing revenue drain (9 June 2017 in Medium). It expands on the opening (#publishing) section of my Daily Tab for that date.
  8. How True Advertising Can Save Journalism From Drowning in a Sea of Content (22 January 2017 in Medium and 26 January 2017 in my blog.)It’s People vs. Advertising, not Publishers vs. Adblockers (26 August 2016 in ProjectVRM and 27 August 2016 in Medium)
  9. Why #NoStalking is a good deal for publishers (11 May 2016, and in Medium)
  10. How customers can debug business with one line of code (19 April 2016 in ProjectVRM and in Medium)
  11. An invitation to settle matters with @Forbes, @Wired and other publishers (15 April 2016 and in Medium)
  12. TV Viewers to Madison Avenue: Please quit driving drunk on digital (14 Aprl 2016, and in Medium)
  13. The End of Internet Advertising as We’ve Known It(11 December 2015 in MIT Technology Review)
  14. Ad Blockers and the Next Chapter of the Internet (5 November in Harvard Business Review)
  15. How #adblocking matures from #NoAds to #SafeAds (22 October 2015)
  16. Helping publishers and advertisers move past the ad blockade (11 October 2015 on the ProjectVRM blog)
  17. Beyond ad blocking — the biggest boycott in human history (28 Septemper 2015)
  18. A way to peace in the adblock war (21 September 2015, on the ProjectVRM blog)
  19. How adtech, not ad blocking, breaks the social contract (23 September 2015)
  20. If marketing listened to markets, they’d hear what ad blocking is telling them (8 September 2015)
  21. Apple’s content blocking is chemo for the cancer of adtech (26 August 2015)
  22. Separating advertising’s wheat and chaff (12 August 2015, and on 2 July 2016 in an updated version in Medium)
  23. Thoughts on tracking based advertising (18 February 2015)
  24. On marketing’s terminal addiction to data fracking and bad guesswork (10 January 2015)
  25. Why to avoid advertising as a business model (25 June 2014, re-running Open Letter to Meg Whitman, which ran on 15 October 2000 in my old blog)
  26. What the ad biz needs is to exorcize direct marketing (6 October 2013)
  27. Bringing manners to marketing (12 January 2013 in Customer Commons)
  28. What could/should advertising look like in 2020, and what do we need to do now for this future?(Wharton’s Future of Advertising project, 13 November 2012)
  29. An olive branch to advertising (12 September 2012, on the ProjectVRM blog)

I expect, once the GDPR gets enforced, I can start writing about People + Publishing and even People + Advertising. (I have long histories in both publishing and advertising, by the way. So all of this is close to home.)

Meanwhile, you can get a jump on the GDPR by blocking third party cookies in your browsers, which will stop most of today’s tracking by adtech. Customer Commons explains how.

  1. Henry Copeland’s avatar

    You could argue, on the other hand, that advertising has been fraudulent for 100 years. What other industry is “buy twice as much because you know half will fail (but you can’t be sure which half.)”

    Note that I’m no longer an ad-tech vendor but DO have a dog in the “helping publishers make money” hunt. And 99.9% of that “monstrous sum of money” you mention is going to those publishers.

    The only players who control a huge volume of first party cookies will be Amazon and Facebook. So GDPR may mean a lot of good publishers suddenly have to downsize 30%… for the 3rd or 4th time.

  2. Doc Searls’s avatar

    So you’re saying the story from the World Federation of Advertisers that Bob Hoffman sources here (and which alas is now a 404), saying publishers get 3% of the advertiser’s spend is wrong? It does seem low to me, but an agency person the other day showed me one of their client’s own studies that said publishers get 8-12% after the three-letter acronyms get through pulling their take out of the flow. Is that also wrong? (I dunno.)

    As for first party cookies, wouldn’t Google go in there too?

    As for fraud in advertising, yes we’ve always had it, but never anything this systematic.

  3. bob hoffman’s avatar

    Doc, I hope and pray you’re right, but I’m seeing disturbing signals. I’m afraid the online bullies are going to play a game of chicken with confused users, implicitly and subtlely daring them to opt out of being tracked, and tying up the EU in preposterous legal battles to support their tactics. If the EU isn’t assiduous in its enforcement it could be a long time before we see daylight. I hope I’m wrong.

  4. Yuhong Bao’s avatar

    I mentioned the GDPR in my Google DoubleClick essay.

  5. Caspar von Wrede’s avatar

    Gawddammit. Get a responsive website already.

    Great article though

  6. Ari’s avatar

    This is a nice speculative opinion piece. Would be great to see something written by a practitioner or having some economic basis.

  7. Doc Searls’s avatar

    Caspar, wish I could, but I’m kinda stuck inside a template here.

    But hey, I’ll look into it.

  8. Doc Searls’s avatar

    Ari, I’ll cop to some speculation, but there are plenty of economic bases in my case. I also spent two decades as a principal in one of Silicon Valley’s top ad agencies. So it’s not like I don’t know the business.

  9. Cold Blanket’s avatar

    Outside of the EU GDPR really has no teeth. No, stay with me here.

    Let’s say I live in the US. In the US, I obey US laws. If my servers are physically in the US, and I live in the US and have no EU assets, it literally doesn’t matter if EU citizens visit my website regardless of what I track. There is nothing the EU can do about it because the US courts are not going to uphold EU law against a US citizen that has done nothing against the law here in the US. The EU can issue fines all they want. It won’t matter. If EU residents want to visit foreign websites they’re going to regardless of any privacy issues. What the GDPR is giving these people is a false sense of privacy because, as I said, any website hosted elsewhere in the world doesn’t have to follow those rules. The EU can’t just magically reach out beyond their boarders and dictate their (sometimes really odd) views on privacy on the rest of the world.

    Secondly, banning EU residents from using your services works just as well. In the end, the EU is only going to be able to enforce the GDPR against businesses or websites that choose to do business in the EU regardless of what their law says. I think this is going to end up having unintended consequences. Instead of stopping websites from tracking users, companies will either just ban EU customers and visitors (like Facebook), or move elsewhere and continue business as normal.

    I’m not anti-privacy, nor do I agree with what Facebook, et al are doing as far as mining and storing user data. However, it’s the users, EU citizens as much as the rest of the world, that agreed to give up their privacy in exchange for “free” access. If you want to blame anyone, blame the idiot users that bought into that contract.

    As for myself, no, I don’t have a Facebook account. I block adware and javascript in order to control the attack surface from malware. I limit my exposure to Google’s services. I keep track of my family and friends in ways that have friendly privacy policies (like you know… the telephone… how old school!) and generate their monies either directly (paid services) or indirectly through their actual product to other businesses (licensing). In the end, Facebook, Google, Doubleclick, and the rest of “adtech” only got big because users never bothered to read the fine print nor bothered to care about any of the other times Facebook has had its user data mined (it was never stolen despite what some have said). If people never gave them that information to begin with it couldn’t have been mined. Pity personal responsibility is no longer expected.

  10. Jim L’s avatar

    What a bunch of garbage. You don’t have a clue how interest based advertising works outside of google and facebook. The third party members of the NAI help publishers compete with Facebook and Google. Now consent will put publishers out of business and empower Facebook and other big companies. Funamentalisms next victim is privacy. Regulators have GDPR all wrong. Privacy is dead and so is innovation in the EU. Consumers will have no more content to read and if they do get out your credit card. Sad! Very sick@

  11. Mark Parker’s avatar

    i very much doubt gdpr will do much of anything, maybe force a few of the big boys to employ some people in their compliance department, create a load more paperwork the politicos love so much. but lets face it, installing malware on peoples computers is way more serious than breaching gdpr regulations, and adtech has zero problem with even that.

  12. Ari Rosenberg’s avatar

    Doc, I gave up trying to convince this industry “Opt Out” was a bad idea through my columns for Mediapost — I still have an email from Randall Rothenberg ripping me for suggesting “Opt In” was the better choice.

    So glad to see this “Opt In” is on the verge of now happening — “Opt in” was always the better choice but we’re an industry filled with people who make bad choices because they could care less about the industry they leave behind for the next generation — glad I caught this read.

    Sincerely,

    Ari Rosenberg

  13. Sam’s avatar

    I agree with Ari. Not a good piece.

    You seem to believe that Adtech is all about cookie tracking.

    Safari browsers do not allow cookies for years, yet it still receives plenty of “adtech”

  14. Morris Bryant’s avatar

    Fantastic article, thanks Doc.

  15. Doc Searls’s avatar

    Sam, Safari browsers do allow cookies. Its latest incarnation uses AI-based “Intelligent Tracking Prevention” Wikipedia says, “to reduce the ability of advertisers to track Safari users as they browse the web. Cookies used for tracking will be allowed for 24 hours, then disabled, unless AI judges the user wants the cookie.”

    We also need a word for the kind of advertising that’s aimed by tracking people. “Programmatic” doesn’t do it, because ads that aren’t tracking-based can also be programmatic. “Interactive” and “interest based” are industry euphemisms. Adtech fits. I’ve also been writing about this for a long time (see People vs. Adtech) and have had almost no pushback against that usage.

    Since I’ve met nobody in adtech who says their business is not about tracking—and plenty who say it is about tracking—I have no trouble using adtech as a label for tracking-based advertising.

    I do take your point that adtech is not all about cookies, because there are many other ways to track people, including fingerprinting. But cookies are still the main tool used for tracking, so I focused on cookies in this piece.

  16. Doc Searls’s avatar

    Thanks, Ari.

    Interestingly, Randall has paid me twice to speak at IAB events, to no effect whatsoever. At one of those, Michael Tiffany of WhiteOps spoke right after me, telling the audience that many, or perhaps most, of their laptops were also working as bot farms, clicking quietly away on behalf of Russian fraudsters out to siphon money out of the adtech supply chain. I saw no reaction. Everybody seemed fine with things, since the industry was growing like a weed.

    But that growth is clearly a bubble, and all bubbles pop. I think one big question is, Will the adtech business regard 4%-of-revenue fines just a cost of doing business, and continue to track people anyway? Quite possible. But I still think it will pop. If not because of the GDPR, then for the simple reason one adtech pro gave me: “it simply doesn’t work.”

    As far back as late 2016, one of the biggest online advertisers told me they pulled $100 million out of adtech and put it all into straight advertising buys because it turned out that the qualified leads they got from tracking-based ads included too many bad customers.

    Between people blocking ads and killing third party cookies on the one hand, and advertisers bailing because direct response marketing turns out not to work very well online in too many cases, adtech will be whacked anyway.

    One irony in the midst of all this is that, at least on Facebook, some tracking-based ads do work. For example, an ad for a fishing tackle shop in a town by a great fishing river can do well advertising only to people Facebook knows to be fishing enthusiasts who travel there. But Facebook’s larger problem is that the same targeting mechanisms can also be used in nasty ways, and there’s not much they can do about that, despite their assurances to the contrary. They have a giant machine meant for fine-grained targeting.

  17. Doc Searls’s avatar

    Cold Blanket,

    I take your points up to where you blame the users.

    There is no “contract,” and reading the fine print of the countless one-sided terms people routinely click “agree” to on the Web would be arduous in the extreme.

    Easier just to block the ads. As of a year ago, 1.7 billion people on Earth were doing that: the biggest boycott in human history. Also a lot of people taking personal responsibility.

    Sooner or later in markets incentives get aligned. Adtech is better aligned with the interests of fraudsters than with advertisers, users or publishers. Which is another reason it’s due for a fall, whether the GDPR makes it happen or not.

  18. Greg’s avatar

    Interesting points about how gdpr will affect google and facebook but i tend to believe that tracking goes beyond ip .In the IT world the algorithms developed the last 10 years can track and profile machines in ways that are hard to imagine.I bet that no law will be able to control this phenomenal.What might help is layered networks within the current internet structure.,this is why blockchain believers are so bullish about it.

  19. Bob’s avatar

    Good read.
    Just one correction: snakes tread, not thread

  20. Matthew Graybosch’s avatar

    Cold Blanket, as a US citizen myself I’ve already made the decision to exclusively patronize GDPR-compliant websites and web apps. I make a point of encouraging others to do the same thing. If a sufficient number of people like me refuse to visit sites run by people like you, you won’t have any choice but to comply with GDPR if you want traffic.

  21. Scott Messer’s avatar

    Great read, highlights good issues.

    Today, my main concern is that the Framework is an honor system.

    Publishers have one technical way of preventing trackers that are returned in ad creatives…by never serving them.

    If a publisher sends 1000 requests and 200 are returned by framework signatories, perhaps those won’t track beyond the consent string. The next 300 contain creatives from non-signatories who have zero allegiance or responsibility to adhere to the consent string.

    Then next 500 come from ADX, where It is unclear how to block or allow specific partners…perhaps it’s 12 allowed, but not sure if they are compliant or whatever.

    You see, publishers (have to) allow all this 3rd party creative that brings myriad trackers. None of the SSPs are saying, “we’ll enforce the framework 100% and take responsibility for enforcing that trackers must obey signals.”

    Publishers need upstream partners to take responsibility and provide transparent and accountable mechanisms for compliance.

  22. John’s avatar

    Nothing like policy set by a collectivist consortium with socialist leanings… that sort of decision-making and coercion has *always* worked out well for the common man.

  23. Kyle Cottrell’s avatar

    GDPR is the cadalist that will disintermediate the adtech ecosystem. the technology is sound, its the business models that need to be reconfigured.

  24. Keith Dawson’s avatar

    Thanks for this. Hope you are right about the GDPR being the bubble-popping event.

    Wanted to mention that your custom Amazon link for The Intention Economy is broken; just goes to the top page. http://amzn.to/ntntcon

  25. Jeff Hirsch’s avatar

    There are many things in this article that are misleading. That said, I’ll only make one observation that many are ignoring – LESS targeted ads are LESS effective, meaning you have to run MORE of them to get the same results (ala television). With LESS targeting, consumers will see MORE ads. This is a largely overlooked outcome.

  26. E Lynn’s avatar

    “US courts are not going to uphold EU law against a US citizen that has done nothing against the law here in the US…”

    This is very likely correct. Businesses that confine both their hardware and economic management to the US are likely immune to this law, regardless of how many European customers they have.

    However, Google’s business isn’t limited to the US, and their Irish tax haven is definitely in range of the EU’s legal rulings. Facebook has servers and banking interests in Europe. So does Apple. Paypal does plenty of business in the EU.

    A court in the EU can’t touch Google’s American money, but it can seize assets that are being held in Ireland.

  27. Doc Searls’s avatar

    John, normally I’m one to urge putting brakes on legislation and regulation of tech. Not because of political leanings, but because most lawmakers and regulators know little or nothing about tech, and tend to cause laws and regulations that protect yesterday from last Thursday.

    But we’re dealing here with a tech failure to address a simple and known market demand for simple personal privacy tech: the digital equivalents of clothing and shelter. Invasion and abuse of people’s privacy by adtech has been wanton and unconscionable for at least the last eleven years.

    When people are abused and taken advantage of, and tech fails to provide them with tools to stop the abuse, regulators eventually step in. That’s what happened here.

    So I say we make the most of it. For my part, I’m encouraging lots of tech development, and involved with some as well. Stay tuned.

  28. Doc Searls’s avatar

    Scott, the existing system is a fail. Simple as that. All the SSPs, DSPs, RTBs and the rest of them have not only abused the “data subjects” the GDPR seeks to protect, but the publishers as well. It’s time for the publishers to return to advertising that isn’t based on tracking. (Look again at what I said about the differences between advertising and adtech.)

    Could be it won’t work because the ad business has utterly turned off the marketplace. But possibly it will. I suggest that publishers fire adtech and go back to the real thing. And that advertisers do the same.

  29. Ratko’s avatar

    Doc, your suggestion for publishers to return back to non-tracking-based advertising will not solve many of the issues you attributed to “adtech” in your post. For example, as long as digital advertising is transacted on a CPM basis — with or without any technology powering it — publishers will remain incentivized towards page views, which in turn encourages click-bait, outrage journalism, listicles, and so on. Removing audience-targeting as a tactic will also not solve other issues you raised, like the aesthetic quality of ads, ad blocker usage, or fraud. In fact, it risks creating a host of new issues for both publishers and advertisers (e.g., economic).

    It’s also worth noting that the current ad tech infrastructure is also used to power non-tracking-based advertising as well. Are you suggesting a return back to non-tracking-based advertising — bought and sold directly, publisher to advertiser, or human-to-human? — or would ad technology still play a role in facilitating transactions between advertisers & publishers in an automated fashion (programmatically)?

  30. Vlad Morar’s avatar

    “US courts are not going to uphold EU law against a US citizen that has done nothing against the law here in the US…”
    Unfortunately for you US signed an agreement with EU specifically agreeing to have the same rules apply to American citizens, companies that interact with Eu users.
    GDRP is the largest and most horrific bureaucratic legislation ever adopted. Came from a good idea but ended up being more than absurd an

  31. Doc Searls’s avatar

    Great questions, Ratko. Some answers….

    First, non-digital advertising has always used CPM as a metric, and page views (or site visits) will always matter to publishers and the advertisers supporting them.

    Second, it’s not publishers’ appetite for page views that encourages click-bait and outrage journalism, but the business model of adtech itself, which favors content production over journalism. I’ve written a lot about this, for example, in How true advertising can save journalism from drowning in a sea of content and Let’s get some things straight about publishing and advertising.

    Third, audiences (I prefer readerships) can be targeted by the foci of the pubs themselves, and the quality of the journalism.

    Fourth, there is no reason advertising can’t be programmatic without being tracking-based. It is essential, however, that the advertisers start looking again at performance against branding metrics (“Are we becoming better known?”) rather than click-throughs and other direct marketing metrics.

    Fifth, I don’t know if it’s possible for publishers and advertisers to go back to branding-type advertising (or interactive ads that simply want a response from anyone reading an ad in a pub rather than they eyeballs that were just targeted), even if it runs through a programmatic mill. That’s because nearly all pubs fired their old ad departments long ago, and handed income production over to Google and other third parties, while (as I put it in Separating advertising’s wheat and chaff) “Madison Avenue fell asleep, direct response marketing ate its brain, and it woke up as an alien replica of itself.” Even Procter & Gamble, which invented branding, today sounds like a company that favors direct marketing over branding. (I could run and find quotes, but need to give a talk on this stuff shortly, so I’ll leave that up to readers.)

  32. lilimarlene1’s avatar

    Why shouldn’t things be tracked. It’s obviously not apples to apples, but direct mail pieces were tracked for, like, forever. Big deal.

    I think we need to look, forgive me for saying it, at the bigger picture and fasten our eyes on our non-self driving cars’ rearview mirrors for a look back at his prescience himself, Marshall Mcluhan.

    The medium is the message.

    We are inside an electronic communication vortex that has landed us in an entirely new, privacy-less age. Wishing it weren’t so won’t make it so.

    And, the outrage about “fake news” is entirely canned.

    News has been manipulated from the get go.

    Putting controls on the news rather than letting all voices even bot voices in is a deadly game in which free speech is the victim.

    Please.

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