Online advertising, particularly targeted advertising, is a fundamental enabler of the Internet economy. Not only do targeted ads allow marketers efficient access to specific audiences, but the higher revenue from these ads helps pay for the vast array of apps, content, and services that consumers access for free online. Some European lawmakers are pushing to ban personalized online ads, claiming that they harm consumer privacy. Given the EU’s extensive existing data privacy framework, consumer privacy is not at risk. However, banning targeted ads would hurt advertisers, app developers, media companies, content creators, and consumers by making online advertising less effective. A ban on targeted ads would reduce the €16 billion of spending on data-driven ads in the EU, threatening about €6 billion of advertising income for app developers. As a result, European consumers would face the prospect of a radically different Internet: more ads that are less relevant, lower quality online content and services, and more paywalls.
Over the past two decades, targeted online advertising has grown rapidly and evolved for both desktop and mobile users as Internet usage patterns have changed. For example, the share of advertising on social media has increased steadily, as have digital video and audio ads, as streaming and podcasting have become more popular among Internet users. At every stage, revenue from targeted online advertising has supported the development of innovative and no-cost online products and services, including social media platforms, mobile apps, games, news media, and more.
Thus, proposals to ban or restrict targeted advertising would significantly harm the EU Internet ecosystem by cutting off an important source of revenue for ad publishers—a group that includes app developers, media companies, and content creators. Banning targeted ads in the EU would make it more expensive for advertisers to reach their target audiences, reduce revenues for publishers, and limit the availability of free and low-cost content for users. Not only are these proposals harmful, they are also unnecessary to protect consumers and uphold European values: targeted online advertising is already subject to a wide-ranging and well-entrenched set of laws that address everything from the content of ads to the protection of personal data. These rules ensure that advertising platforms respect that rights of European consumers when they collect and use personal data for advertising and that advertising platforms do not sell copies of consumer data to advertisers.