Data protection vs. innovation: the new traffic rules

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Apple’s switch to a more private, consumer-oriented data model with the announcement of the ATT (App Tracking Transparency) function puts consumers in the driver’s seat of data protection and enables them to activate or deactivate the exchange of data. The move creates tension between companies, especially Big Tech, who fear that giving up control over their data will hamper innovation – but nothing could be further from the truth. It’s not about who drives the car, it’s about setting road rules.

It may be hard to believe, but the internet is still at a relatively young stage, much like the mass production of automobiles at the beginning of the 20th century. When people were used to horse-drawn carriages and walked as the primary mode of transportation, hearing an engine speed and seeing a gas-powered device down the street was as exciting as it was alarming. The same applies to data protection and the Internet. Consumers are inexplicably intrigued by the possibilities, but neither they nor the companies haven’t reached their full potential – for better or for worse.

It will require coordination from governments, big tech and consumers to implement common core principles to protect privacy and pave the way for safe data traffic in the internet age. While fear is often associated with change, everyone can win if we learn to be creative with common privacy standards. These standards should include:

Looking both ways: Understanding the ad ecosystem

In most cases, consumers mistakenly assume that their data is isolated for a particular app, even though it is usually shared with an entire network of partners. The ad ecosystem is very complex. Companies approach it from every angle, inadvertently leaving many people at a loss. An element of education is required before the industry can begin developing common road rules. Companies are responsible for telling their customers exactly how and when their data is being used – beyond their immediate purposes. This can be a challenge. Just check out the Google Incognito lawsuit. While the home web browser splash screen indicated that websites might have the ability to collect information about a user’s browsing activity, given the name, users continued to expect their information to be confidential and not tracked. Data security is very different from data confidentiality, but the two often link the two.

Information needs to be presented in a way that is easy for consumers to understand. Long words and small fonts can sometimes be the leaky tire that leads to a crash.

Red light / green light: Allow consumer consent

Once consumers understand how their data will be used, the second step is to set up the pictorial traffic lights. Businesses should give consumers the ability to turn themselves on or off, just like Apple’s ATT feature. It remains to be seen whether the opt-in is designed and presented in a way that is understandable to consumers, or whether it is just another button that people click without a second thought.

One thing that companies should consider when creating consent options is the use of dark patterns. These carefully designed user interfaces can be designed to either enlighten or confuse a user. Examples of this are confusing language that contains double negatives, e.g. B. “Don’t sell my personal information” and the appearance that the user does not need to submit or disclose essential information in order to continue using a product or access a website. Businesses should use what they have learned about dark patterns and user behavior to help consumers understand what they are okay with. This will build better relationships with your customers in the long term.

Stop signs: what happens if a consumer disagrees?

Change is always scary and can feel restrictive. Consumers fear the use of their data and lack of control over where it is sent. Organizations fear that less access to data will have a negative impact on their bottom line. For too long, companies have taken consumer data for granted and relied on the way things are always done. But just because a consumer signs out doesn’t mean you’ve hit a stop sign – just turn right!

User consent can wake businesses that still believe consumer privacy is at the other end of the innovation pendulum. Now is the time to rethink your digital ad strategy and rethink how you can connect with customers in a privacy-conscious way, or take the risk of losing all together.

Watch out for speed bumps! Compliance with data protection laws

Once the road rules are in place, it is important to keep an eye on the road and watch out for any unexpected obstacles. In the absence of (current) federal consumer privacy legislation, many states have enacted their own laws, including the California CPRA and the Virginia VCDPA. More states are expected to pass their own bills this year, and companies need to watch out for ever-changing regulations – especially companies that operate in many different states and jurisdictions.

The data protection landscape is constantly changing. It is important for companies of all sizes and their attorneys to keep abreast of new regulations, the evolution of big technologies, and consumer demand.

Beth Magnuson, CIPP / USA, CIPP / E, joined Practical Law from Oracle, where she was a legal advisor responsible for privacy and security issues. Her previous positions at Oracle (formerly Sun Microsystems) focused on trademark and copyright issues. Previously, she was Special Counsel to Faegre & Benson, General Counsel of Pumpkin Masters, a seasonal products company, and Intellectual Property Associate at Finnegan, Henderson, Farabow, Garrett & Dunner and Welsh & Katz (now Husch Blackwell).

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