Europe’s Ad Industry Issues Response to Cookies Opt-in

cookiesThe European advertising and media industry have described calls by data privacy regulators for opt-in by users for placing cookies on their PCs as out of step with online businesses and their consumers.

In a joint response to the Article 29 Working Party “Opinion 2/2010 on online behavioural advertising”, published last week, a consortium of industry organisations, including IAB Europe, World Federation of Advertisers (WFA), European Publishers Council (EPC) and European Advertising Standards Alliance (EASA), said it was “out of step with the relationships that businesses and consumers are building online and flies in the face of the reality of the internet.”

“This is an overly strict interpretation of the ePrivacy Directive,” said Angela Mills Wade, executive director of the EPC.

“If followed by the Member States, it would kill any chance of the media building viable advertising revenues online and our serious efforts to give consumers effective control over the use of cookies. Only this week, speaking before the AMCHAM, Commissioner Reding said: “This sector needs clarity not red tape […]. This is why self-regulation could work well in this area to complete the existing rules”.

“We welcome this more nuanced approach by the Commission, their confidence in self-regulation and a balance between regulation and business interests,” said Mills Wade.

“The Article 29 group is suggesting that whatever ‘information’ is stored in cookies, it must be treated as if it were ‘personal’ data and as such should be subject to explicit, prior consent. The Directive currently does not require an opt-in for cookies. In practice, such a requirement would mean that users would have to confirm every single cookie placed on their PCs, leading to a permanent disruption of their internet experience.

“The industry believes this is a gross misinterpretation of the intention of the Directive and a misrepresentation of the type of data typically collected and processed for the purposes of serving interest-based advertising to consumers on our websites. The ePrivacy Directive acknowledged that the controls in modern web browsers give users full and granular control over cookies.

Stephan Loerke, managing director of the WFA, said the Article 29 opinion takes no account of the support advertisers get from their consumers for interest-based advertising nor of the exchange in value they receive between effective advertising and access to high-quality media content for free.

“Obviously, the internet in Europe would become less attractive to users and would significantly undermine the growth potential of the digital economy. Such strict privacy regulations would not only jeopardize the existence of European online companies but would call into question the EU’s ambitious digital agenda, intended to increase Europeans’ access to the ultra fast internet and fostering the e-commerce sector,” said Stephan Noller, CEO of and IAB Europe chair of the policy committee.

The industry bodies said that cookies are essential to the smooth functionality underlying new business models that involve reaching consumers through tailored, interest-based content and matching advertising based on users’ potential interests.

“These ‘data’ are not personally identifiable or sensitive, and do not harm consumers’ privacy,” said Mills Wade. “That is why at present the regulatory regime across Europe allows for a consumer to control of the use of cookies themselves through their browser settings and options to opt-out of receiving cookies.”

“We are looking forward to a dialogue with the Article 29 Working Party to discuss the proposed concepts, their feasibility, and practicability and provide our ideas how transparency and choice for users can be increased with more proportionate measures than an opt-in,” said IAB Europe vice president Kimon Zorbas. “Self-regulation could be the solution that contributes to increased transparency in a meaningful way that regulation could hardly achieve.”