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Government should empower the Digital Markets Unit to take on Facebook and Google

Do you realise the extent to which you’re being exposed to targeted ads? Here’s why we want to see the power put back in the hands of consumers.

We’ve all been there. One day you’re absent-mindedly looking online at running shoes, toying with the idea of taking up a new lockdown hobby, before logging off and doing something else. The next day, there it is: an advert for the trainers of your dreams, just the right size and with 60 per cent off while stocks last. 

If you’ve browsed online recently, the chances are you’ve been exposed to targeted ads. The way it works – companies collect data about you through cookies, which helps them to find out your interests and place things they think you’d like to buy on your screen – has become such an inevitability of modern life that it almost seems redundant to say. 

Except many consumers don’t realise the extent to which this is happening to them. We recently asked more than 1,300 people who said they used Facebook at least once a day to check their settings. The average number of websites or apps that Facebook reported tracking them on was 283.

82% of respondents said that number was higher than expected; 84% said that they were surprised by some of the types of organisations that Facebook tracked them on. 

Google and Facebook clearly bring very real benefits to their users. Access to information online has never been easier. Nor has keeping in touch with friends and family, the importance of which has only grown in the past year.

Market domination

The question isn’t whether our lives are better because of the services provided by these companies today, but whether we could be better off by making these markets more competitive and not dominated by a handful of companies. 

Concerns about Google and Facebook’s concentration of market power are not new. However, remedies to tackle the issue are. That’s where the Digital Markets Unit (DMU), launching this month, comes in. Its task is to further the interest of consumers and citizens by driving competition and innovation across digital markets, including addressing the market power of big digital firms.

For it to be a success, two key things must happen. First, the government must give it the necessary powers to promote competition so that digital platforms deliver better outcomes for consumers. The current lack of competitive market pressure shuts out other companies vying for a slice of the data pie.

For example, Google’s position as the default search engine on many devices enables it to consistently improve its search results and entrenches its market power. Reforming the market by restricting such default positions could stimulate growth and innovation. It would also provide consumers with a genuine choice of provider, rather than the decision in effect being made for them.

Second, the DMU should have the power to introduce the right remedies to address consumer harm, especially when it comes to giving consumers more control over the collection and use of their data. Having a Facebook account shouldn’t mean a trade off in which the consumer is expected to ‘pay’ for a level of service by giving up their right to privacy.

Some consumers like being shown targeted ads, but they should have to choose for their data to be used in this way.

Consequences of inaction

Tackling companies as entrenched in public life as Google and Facebook will be a difficult task. But the consequences of inaction are also costly, not least because uncompetitiveness leads to more sluggish economic growth. 

After years of consumers being powerless in the face of these tech giants, the CMA is now showing it’s prepared to step up and take action to restore the balance in favour of the consumer and competition, and that’s good to see.

Its recently announced antitrust investigation, this time into Facebook, is a step further in the right direction. The DMU has the potential to do even more to ensure the UK has dynamic and competitive digital markets and put power back in the hands of consumers.

The government must give it the powers to do so. Do you agree?

Comments

I’m very conscious of targeted adverts. I’m also fond of efficiency and avoiding waste and irrelevance. It makes lots of sense for business to only advertise to people who might be interested in their products and it is a relief not to be showered with adverts for things of no relevance to me. The big issue is ‘do I suffer by having targeted ads presented to me?’. Having ads at all is an irritation but is the price I pay for free content. I’m afraid I don’t understand why their being targeted should upset me or anyone else.

I had forgotten about this new body, the Digital Markets Unit, which has been set up within the Competition and Markets Authority. Has any reason been given for it being a non-statutory body with no actual powers [yet]? Are Google and Facebook quaking in their boots as they are now confronted by yet another toothless tiger? I thought the UK was going to be the leading activator in digital discipline.

Of course, cracking down on two of the biggest American companies [by market value] has to be a smart move when we are looking for an easy ride on a trade deal. Never mind; just an idle thought.

I support the general principles outlined by Rocio in the Intro in terms of increasing competition and cutting out conflicts of interest. I am not over-bothered by targeted adverts, but some websites [mainly news media] are flooded out with them to the detriment of their content, but that’s their look-out. So long as preventing market domination and promoting competition in digital services are the prime objectives, I can probably live with unwanted adverts which my eyes hardly notice in detail.

I look at many different things on the web in the pursuit of my everyday activities, usually with no interest in acquiring them, and it amuses me when the item follows me around in other browsings or pops up in an unrelated or inappropriate place.

Em says:
8 April 2021

@john wrote: “… it amuses me when the [ad] item follows me around in other browsings or pops up in an unrelated or inappropriate place.

Like the time I was researching interest-free balance transfer credit cards, and then began idly browsing the top attactions in Amsterdam, where I used to live.

Number 7 was the red light district, featuring a photo of a shopfront, complete with brightly-lit window dressing. Over the top, a banner ad for the British Airways Amex card appeared, urging us to “Earn 5,000 Avios when you spend £1,000 in your first 3 month of membership”.

Could be embarrassing!

I suppose we have to accept that every click we make is now someone else’s sales opportunity and we are all guilty by association.

Em says:
8 April 2021

There is a specific problem with targetted advertising that goes beyond general annoyance everytime you happen to Google something you might have been casually researching. For instance, a couple of days ago, I wrote a comment on Which? about D&G and their connection with Sky Betting and Gaming. Now I am getting “relevant” ads for Sky and gambling sites. I’m not interested in either. But now put yourself in the place of someone who is struggling with a gambling addiction. Do they really want to see these ads after looking for advice and help online?

And I am equally concerned about times I have looked up some medical condition on NHS and other sites, either for myself, my family, or just for education. Suddenly, targetted ads start appearing for medicines and other treatments – Gaviscon for instance – for conditions that would be better referred to your GP in the first instance.

This is aside from medical and healthcare data being classified as sensitive personal information under GDPR. It doesn’t matter that you don’t know my legal name; you have my computer’s IP address, location and account name – that makes it personal data. No one has the right to process this type of personal data without my explicit consent – which Google and others do not and cannot have, as permission must be sought for each specific purpose. And I wouldn’t trust Google or anyone else to use a computer algorithm to target an ad which is actually in my best interests, rather than that of their sponsors.

As an experiment, I Googled “diet” and quickly browsed a couple of websites. Next I went to the Mirror newspaper web site. I was presented with Iceland banner ads for Greggs sausage rolls, TGI Fridays Brownie and Chicken Wings, and a further promotion for “Slimming World”. I clicked on the latter, and was taken to the Iceland homepage, featuring Goodfellas pizzas, Doritos, Pringles, and Kelloggs sugar-coated kids cereals. Hardly foods that would assist with weight loss.

Too much of a coincidence? The trouble is we don’t even know.

I’m not entirely sure that knowing what you look up is the same as knowing information about what conditions you have. One might be inferred ( sometimes rightly sometimes wrongly) from the other but they are not really the same data. And there is a big distinction between you looking at sites which contain adverts and people sending you unsolicited mails ( where the rules are much tighter) . And, a third comment – While using medical data requires consent there are permitted reasons for using data other than consent .

My own feeling is that the biggest problem in this whole mix is that your consent is so often obtained and that giving it is almost unavoidable without cutting yourself off from digital communication. Which is part of the reason I have suggested a whole new conversation topic on whether the concept of contract is now outdated and should be buried in relation to consumers.

Em says:
8 April 2021

@DavidBrush – I would agree with your second paragraph.

But you are misinterpreting the DPA protections and the meaning of data. Sensitive personal data is not always about fact, but can be inferred from the subject’s own behaviours. If I go to a synagogue, does that make me a Jew? If I go to a right wing political rally, does that make me a neo-N**i?

It’s nobody’s business but my own, and even inferring anything about protected characteristics from my behaviour, then going on to process that derived data is most likely against the law. From the two examples given above, the reason for this protection should be obvious.

ICO guidance states:

Special category data includes personal data revealing or concerning the above types of data. Therefore, if you have inferred or guessed details about someone which fall into one of the above categories, this data may count as special category data. It depends on how certain that inference is, and whether you are deliberately drawing that inference.

The permitted reasons for processing are very limited in the case of special category (sensitive) personal data. Permitted reasons are:

(a) Explicit consent
(b) Employment, social security and social protection (if authorised by law)
(c) Vital interests
[that’s my vital interests – i.e. keeping me safe from harm]
(d) Not-for-profit bodies
(e) Made public by the data subject
(f) Legal claims or judicial acts
(g) Reasons of substantial public interest (with a basis in law)
(h) Health or social care (with a basis in law)
(i) Public health (with a basis in law)
(j) Archiving, research and statistics (with a basis in law)

None of those apply to marketing activities.

For years, advertising has had a negative effect on me and I have boycotted companies that have subjected me to spam, even when I have never used them.

I frequently look at YouTube videos and recently the amount of advertising has increased. I presume that the intention is to push us all to pay a monthly charge to avoid the adverts. Octopus Energy is on my list of possible future energy suppliers but unless they stop bombarding me with ads I might strike them off the list.

I am very familiar with targeted ads and it would be good to see an end to them but I don’t know what Which? can achieve. I hope there are others who find that advertising can have a negative effect.

They certainly have a negative effect on me. I do not even allow the limited number of companies I do regular business with to send me sales promotional e-mails or offers. I sometimes wonder when the perpetrators of targeted advertising will realise they are chasing rainbows. The costs of designing, launching and displaying adverts on websites comes out of our pockets ultimately.

On a slightly different point, it annoys me when not accepting cookies, or positively denying them, means you cannot proceed into a website. I think that is where a lot of the damage is done.

I agree about cookies, John. I used to reject cookies until I found that it was impossible to order from John Lewis. Since then I have regularly cleared the cookies from my computers. Thanks to the current login hassles on Which? Conversation I sometimes clear my cookies once a day.

A former friend who moved into targeted advertising tried to persuade me that this advertising is better than bombarding me with information about products that I am unlikely to be interested in.

Some sites make it easy to reject cookies -“reject all” and one click hopefully does it. On others you have a long list of off/on buttons to click and then save the selection; tedious but it works. But others seem to be impossible to reject, or else the means is obscure and simply not worth the time and effort. I just close those down. What I would like to see is all sites being required to have an accept all / reject all choice.

Em says:
8 April 2021

A second practice that needs tackling is location-based advertising. We’ve all seen targetted adverts for: “Laser eye correction takes [location] by storm”, or “[Location] Mum wins £10,000 on lottery for just £1”.

These adverts are clearly false, since it cannot be substantiated for the majority of geographies where the advertisement might appear. But the ASA will only deal with these on a case-by-case basis.

Since location has been determined by the platform (Google et al) and the data inserted into the ad by them, they have the primary responsibility for posting this misleading advertising. They cannot claim they are simpy distributing content provided by others.

I am unsure how the UK, on its own, could influence Google, Facebook.