Google updates data privacy policies for targeted ads in the EU

Google is toughening its data privacy policies for targeted ads in Europe to comply with the Digital Markets Act (DMA).

Brands and advertisers will begin to notice the changes, such as additional consent banners and a new Data Portability API, as they are rolled out in the coming weeks.

Why we care. Tougher data privacy policies might affect Google’s capacity to deliver personalized ads and content. This could potentially reduce the effectiveness of advertising campaigns, as they may not effectively reach the desired target audience as accurately.

Additional consents. Google is rolling out a new consent banner to users in the EU in the coming weeks. It will ask for permission to share data for personalized content and ads. If you don’t give permission, certain features may be limited or unavailable.

Data portability. To address new requirements for transferring data to third-party apps or services, Google will soon be testing a Data Portability API for developers.

What is data portability? Data portability is the transfer of data between various applications, programs, computing environments, or cloud services. This enables service providers to pursue targeted advertising.

Choice screens. Google is also introducing additional choice screens on Android phones, allowing users to switch their default search engine or browser more easily. These screens will be visible during device setup on Android phones and within the Chrome app on desktop and iOS devices.

Search update. In addition, Google is adding dedicated units with links to various comparison sites and search page shortcuts for refining searches in the coming weeks. In specific categories like hotels, Google is trialing a dedicated space for comparison sites and direct suppliers to show more detailed results such as star ratings. Some features, like the Google Flights unit, will be removed when the changes are implemented.

What is the Digital Markets Act (DMA)? The DMA is a new piece of legislation designed to ensure that large online platforms, called “gatekeepers”, behave in a fair way online to create a fair and open environment for online businesses. The legislation comes into effect in March.

Who are the gatekeepers? Gatekeepers are large online platforms like Google that meet the following criteria:

• Has a strong economic position with a significant impact on the internal market and is active in multiple EU countries
• Has a strong intermediation position, meaning that it links a large user base to a large number of businesses.
• Has (or is about to have) an entrenched and durable position in the market, meaning that it is stable over time if the company met the two criteria above in each of the last three financial years.

DMA violation penalties. The consequences of non-compliance with the DMA includes:

• Fines: Up to 10% of the company’s total worldwide annual turnover, or up to 20% in the event of repeated infringements.
• Periodic penalty payments: Up to 5% of a company’s average daily turnover.
• Remedies: These can include behavioural and structural remedies, such as the divestiture of (parts of) a business.

What Google is saying. Oliver Bethell, Director, Legal, Google, said in a statement:

• “Over the last few months we have been seeking feedback on our changes from the European Commission and from stakeholders like developers, advertisers and companies who will be affected by them.”
• “While we support many of the DMA’s ambitions around consumer choice and interoperability, the new rules involve difficult trade-offs, and we’re concerned that some of these rules will reduce the choices available to people and businesses in Europe.”
• “We’ll share more details on the final changes we are making to comply with the new rules ahead of the March deadline.”

Deep dive. Read Google’s announcement in full for more information.