A little over a month ago, our government passed a law that rolled back proposed consumer privacy rules for internet service providers, or ISPs, essentially allowing ISP data tracking. Everyone in our industry has an opinion on what this means for them, including consumers, advertisers, publishers and the ISPs themselves. Here’s a roundup on the implications of the ruling for all the players.
Why is ISP data tracking allowed?
The rules proposed by the FCC are related to, but separate from the net neutrality decision made in 2015. In a nutshell, reclassifying ISPs to comply with net neutrality opened a loophole for consumer data protection. The proposed rules, developed during the Obama administration but not set to go into effect until December this year, would have required your opt-in to give permission for your data to be used for advertising. The rollback allows ISPs to continue to use or sell your data as they wish, unless you actively opt out, which is a more involved process than being asked to opt in.
Internet Service Providers – A Seat at the Table
Three of the largest ISPs have claimed they do not have plans to sell consumer data to third parties. However, even if they keep this promise not to sell data, they can certainly use it themselves to offer more robust advertising opportunities than they have previously. Some industry insiders think that ISPs are looking to rival Facebook and Google and increase their profits through creating cross-device advertising packages. After all, your ISP knows every single website you visit on every device, and if they are also your cable provider, they know every show you are watching. Some take this a step further and think that ISPs are going to marry their data with ad tech acquisitions to create an entirely new business model.
Publishers – Concerns Over Proprietary Data
Publishers haven’t spoken out directly about the ruling, but some could be worried that ISPs will steal their hard-earned proprietary data. ISPs only see the top-level domain of secure sites, so they might know that you visit The New York Times website regularly, but they won’t see which stories you read. However, this data could be enough to combine with other signals to put you in a “reads newspapers online” audience. The ISP could profit from the publisher’s data without the publisher’s involvement. However, as noted earlier, it seems more likely that ISPs will monetize this data through cross-device packages rather than sell third-party data.
Advertisers – Trade Groups Onboard, Advertisers Keeping Mum
Industry trade groups seem to be for the ruling, claiming that there will be more opportunities for relevant advertising. Both the Data & Marketing Organization and Internet & Television Association applauded the decision. It’s not surprising that trade groups would be in favor of more accessible consumer data. Individual advertisers and DSPs have yet to speak out publicly, perhaps because they are caught in the middle. They could be intrigued by new targeting opportunities available through ISP data tracking but might be hesitant to speak out since the legislation is so unpopular with consumer and privacy advocates.
Consumers – Worries About Invasion of Privacy
Finally, consumers are concerned about invasions of privacy. Not much has changed, but consumers don’t like being reminded that their daily internet activity is for sale, especially since they are paying ISPs for their services. It’s very different from the data-as-a-fee services that Google and Facebook provide. Consumers can try to protect their data through opting out of ISP data collection, using end-to-end encryption apps or setting up a virtual private network, or VPN. Each method has benefits and drawbacks, but the one thing they all have in common is that it is up to each user to protect their data.
At the end of the day, we’re at the status quo since the proposed FCC rules never went into effect. We’ve yet to see major plays by ISPs to use this data, but that doesn’t mean they aren’t already taking advantage of it behind the scenes, or that they don’t have plans in the works. This is a development that we’ll keep our eye on, and we’re interested to see how the ramifications of the law will affect our industry.
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