Privacy reform overreach could put free online content and services at risk

On April 13, 2023 Media Releases

Thursday 13th  April 2023:  IAB Australia has published its response to the Attorney General’s Department’s Privacy Act Review Report 2022, expressing concerns that what is proposed could severely restrict digital advertising and online publishers and platforms’ ability to provide free content and services.

According to Gai Le Roy, CEO of IAB Australia, while the Report strikes the right balance in several areas, its proposals for digital advertising, targeting and trading in particular, are too broadly scoped and inconsistent with international approaches.

“Data is at the heart of IAB members’ businesses and key to the relationship they have with consumers. We strongly support a modernised privacy framework that is fit for purpose and meets consumers’ expectations – both in terms of protecting their privacy, as well as enabling them to engage in the digital economy. These goals are not mutually exclusive.

“Critically, we think the reforms should provide businesses further clarity that low-risk operational activities that fall within consumers’ expectations are not unnecessarily restricted. These activities should at a minimum include data processing (including data segmentation), measurement, analytics, and research.

The digital advertising ecosystem provides significant value to consumers, the economy and society more broadly. In 2021, the industry:

  • contributed $94 billion to GDP (>4% of GDP) and supported 450,000 jobs (3% of jobs, 24,600 jobs directly), with SMEs receiving 61% of the sector’s benefits.
  • contributed $55.5 billion in total consumer benefits, including $8.8 billion in access to ad-supported digital content and services.

Consumers highly value this. According to PwC’s analysis, the average Australian consumer is willing to pay $544 annually to access currently free-ad-supported digital services and content. Most critically, ad-supported online content and services are most important to lower-income consumers. For consumers on annual incomes below $50,000, the value they attribute to content and services that are currently free was roughly double that of consumers with annual incomes over $80,000.

“The digital advertising industry understands the importance of ensuring sufficient protections are in place to protect consumers’ personal information.  However, we want to work with Government to ensure that the reforms don’t go too far and put the significant value that consumers receive from our industry at risk”, Le Roy said.

IAB Australia’s response to the Attorney General’s Department also noted:

  • The proposal on direct marketing requires clarification in relation to its operation as well as how it relates to other proposals in the report, including the targeting proposal. It appears to already capture targeting of a reasonably identifiable individual – which we support.
  • IAB Australia does not support the proposals in relation to ‘targeting’ more broadly, which go well beyond regulating privacy harms. Where advertising practices give rise to consumer law or other advertising harms, they should be addressed under the regulatory frameworks that deal with those issues.
  • IAB supports the Report’s proposed move away from a consent-centric approach to privacy regulation and accepts that that means that organisations must take greater responsibility for the management and handling of data. However, if a ‘fair and reasonable’ test is introduced into the Privacy Act, a legitimate interests style provision should also be introduced to ensure the reforms in Australia are consistent with (rather than significantly more restrictive than) equivalent jurisdictions overseas such as the EU, UK and Singapore.
    • Clarification is required in relation to the proposed amendments to the definition of consent. IAB Australia strongly opposes any amendments that would require opt-in consent (if that is intended), and we also do not support any amendments that would result in increased consent fatigue.
    • In line with a move away from a consent-centric approach to privacy, IAB Australia does not support the proposal that the broad range of activities that fall under the proposed definition of ‘trading’ should require consent. This is not the case in the EU, UK, or California.
    • IAB Australia supports the proposed definition of de-identification, however, any obligations in relation to de-identified information should reflect the fact that the information is de-identified.

IAB Australia members can download the ful submission here