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Opinion 9 Sep 2019 - 4 min read

Data economy is busted - and so are you

By Paul McIntyre - Executive Editor
Paul McIntyre - Mi3 Executive Editor

Yet another round of sweeping regulatory investigations this week into the marketing surveillance economy in the US and Australia should be enough to snap industry into a data-induced fever. But it won't. Chances are you will be too apathetic and bored to read this. The former adman and scathing industry critic, Bob Hoffman, calls it a "conspiracy of silence". He's dead right.         

I know, it's so boring. But bad luck. This one's short.

There's so many warning signals coming at the marketing, media and tech industry around its presumption that user data is an unrestrained, fully exploitable gift that will keep giving that we're now beyond flirting with clear and present regulatory danger.

Today's emerging digital marketing, agency, media and tech set have not really sampled how regulatory forces can restrain their day job behaviour. That will come as a shock when suddenly geo-location data is no longer accessible without clean, compliant lines of user consent; that capturing user data at will to target, analyse and communicate will be enormously restrained; and that if you break those rules, what it will be like for a brand to be named, shamed and fined for breaching the law. 

Here's a couple of more developments from the past week which should shake industry from it's torpor, and get on the front foot in changing the way it captures and uses consumer data. Why else is Facebook making all the grand moves to privacy and private messaging? Partly because It smells its own blood in the water and taking evasive action. Industry, at large, however, is still bumbling. 

Here's two more proof points if you need them:

The first:

  • Last week the ACCC released it's draft report into Customer Loyalty Schemes, highlighting a number of concerns that it linked directly back to its Digital Platforms Inquiry and proposed changes to the Privacy Act. Retailer and airline programs are in the spotlight.
  • It said there was "poor disclosure" about how consumer data is used and shared, including "selling insights" from consumer data to other parties "without consumer knowledge" and the "sharing of consumer data with unknown third parties"
  • The ACCC's chairman Rod Sims said in a statement: "Consumers may also be shocked to find some schemes collect their data even when they don't scan their loyalty cards, or that they combine it with data from other sources that they might not even be aware of." Sound familiar?
  • Again, Sims referenced the Digital Platforms Inquiry: "The ACCC's findings in this report also reinforce the recommendations of our Digital Platforms Inquiry Final Report for consumer and privacy law reform. In particular, the ACCC recommends strengthening the Privacy Act 1988 and broader reform of the Australian privacy regime to maintain effective protection of consumers' personal information in the longer term."       


The second:

  • A bipartisan coalition of US States announced last week they are preparing antitrust investigations into Facebook and Google, led by New York attorney general Letitia James.
  • Texas attorney general Ken Paxton, a Republican, said a news conference this week will detail a "multistate investigation into whether large tech companies have engaged in anticompetitive behaviour that stifled competition, restricted access and harmed consumers".
  • New York attorney general, Letitia James, a Democrat, said the multistate probe will investigate Facebook: "We will use every investigative tool at our disposal to determine whether Facebook's actions may have endangered consumer data, reduced the quality of consumers's choices, or increased the price of advertising."
  • Other states joining the Facebook investigation include Colorado, Florida, Iowa, Nebraska, North Caroline, Ohio and Tennessee. Get the picture? It's big.  

What now?

Take the regulatory threat seriously. In the past couple of weeks, Mi3 has published some important industry discussions and interviews on the issue. Get up to speed here:

Get cracking.


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