Yesterday, the FTC released a report criticizing top social media and video streaming companies for what it calls “vast surveillance of consumers… to monetize their personal information.” It was a report with a clear point-of-view shaping the findings: targeted ads are bad.
In response to the report, the IAB and ANA have released statements defending the industry.
“We are disappointed with the FTC’s continued characterization of the digital advertising industry as engaged in ‘mass commercial surveillance,’” says IAB CEO David Cohen. “This charged statement suggests that the personal data of consumers is covertly collected and used for advertising purposes.”
ANA CEO Bob Liodice responded similarly: “This FTC report decides to tear down the entire house with a sensationalist report that claims that the theoretical harms of data use outweigh all the staggering benefits of the digital economy to individuals and businesses.”
Why This Matters:
The FTC has consistently used the phrase “surveillance advertising” to describe modern digital advertising, working to cast the industry in a negative light and push for regulation.
For example, in a 2021 speech, the FTC referred to behavioral advertising as “a surveillance business model.” This framing is sexy because “surveillance” is an inherently scary term. You can see that play out in the mainstream coverage of the FTC’s report, which was brutal for the industry.
Based on a simple Google search, there were over 1,000 articles published about the report that used “surveillance” in the headline. Examples include: Good Morning America: “FTC report finds ‘vast surveillance’ of users on social media apps,” and the Los Angeles Times: “Social media platforms engaged in ‘vast surveillance’ and failed to protect young people, FTC finds.”
The IAB and ANA recognize that it is difficult to have a fair conversation about data use in advertising when the FTC is starting from a perspective of “this is nefarious surveillance.” The framing vilifies the industry from the start and undermines efforts to improve practices and address concerns.
Experts React:
Liodice reframed “behavioral advertising” as “interest-based advertising” in the ANA statement to emphasize its benefits.
“Interest-based advertising is the economic engine that funds free and low-cost services to millions of Americans through the digital apps, online services, news publishers, and websites they love,” he writes. “In addition, digital advertising allows millions of small and local businesses to find and reach the consumers they need to grow and succeed.”
Both the IAB and ANA shared that they back “comprehensive national data privacy laws,” as the growing state-by-state patchwork of laws can be challenging to navigate.
Our Take:
The FTC’s “surveillance advertising” framing is effective, but what about it’s long-term viability? Most digital advertising and the underlying adtech that powers it is actually… pretty mundane. As consumers continue to see little tangible harm from it in their day-to-day lives, the sensationalist framing may lose its juice.
The FTC’s anti-competition angle seems more effective long-term. Their report argues that platforms creating “vast walled gardens” harm both competition and consumer privacy. Excessive data collection is anti-competitive and anti-consumer. This approach would likely garner broader industry support versus the more antagonistic “surveillance economy” message.
In response to the report, two strategies might be key for the IAB and ANA. Continued education for the public and policymakers about the benefits and value of targeted ads, and more consistent use of the term “interest-based advertising” (or something else) to counter the “surveillance advertising” storyline. This can reframe the conversation and highlight the industry more fairly.
