Is the European Commission fundamentally misunderstanding contextual ads?

Did I get this right? Thierry Breton at the European Commission is suggesting that a specific form of advertising (“contextual” – i.e. ads based on limited data) is required by the DMA, as an alternative to another (profile-based advertising), and that a “consent or pay” approach might not be permitted (the Commission apparently has “serious doubts that this consent is really free when you are confronted with a binary choice”).

That reasoning hinges on the notion of “consent” (a core part of Art. 5(2) DMA), which according to the DMA is GDPR consent. Yet because the DMA defines “consent” by reference to the GDPR, that notion of “free” [= freely given] consent is not an autonomous DMA concept but rather the GDPR concept.

So in practice the Commission, from a DMA angle, is expressing “serious doubts” regarding the compatibility of a practice with the GDPR.

This is an “interesting” perspective, notably given that at the same time the European Data Protection Board is examining the issue separately but also given that the Commission’s perspective on this GDPR concept (and not a DMA concept) suggests that *GDPR consent to profile-based advertising can never be free*, an astounding and wholly disproportionate proposition in my personal opinion.

There are many reasons to consider that contextual advertising is *not* a silver bullet, and I have seen time and time again people brandishing the idea that contextual advertising is an equivalent alternative to profile-based advertising, without tangible evidence. [Typically this is based on (i) a flawed understanding of how onlineadvertising and adtech work, for technical reasons & due to the need for measures to facilitate trust among partners (validation, attribution) and/or (ii) reliance on 1-2 widely quoted use cases where contextual ads happened not to lead to a significant loss of revenue due to factors that cannot be replicated in most cases. Plus, the EDPB now suggests ePrivacy requires consent even for contextual.]

Even if it were such a solution, would that mean that if a particular business gets less revenue from contextual ads, it is allowed to place more ads on the service, and that will still be seen as equivalent?
If not (i.e. contextual ads do not bring in the same revenue) and a service provider does not feel it sufficiently profitable, is the service provider then somehow required by law to continue to offer an unprofitable (or less profitable) service, without any option to request payment instead?

I have advised gatekeepers on the data provisions of the DMA and all sizes of companies (gatekeepers and non-gatekeepers) on the GDPR, and one thing I say often is that maybe regulators need to be challenged in that respect. (Maybe that’s the data litigator in me speaking, but I think they are not challenged frequently enough on this)

For more on the topic (notably ePrivacy links and other references), see my previous post on “pay or consent”: https://lnkd.in/dKD9CmN6

data protection