R is for RTB

In the latest addition to our A-Z of Adtech series our Product Compliance Director, Kelly Jacobson Collins, takes a look at RTB and the ICO’s latest report.

Real-time Bidding (RTB) is a fundamental pillar of programmatic advertising and refers to the automated buying and selling of online ad impressions through real-time auctions which take place in milliseconds. Those auctions are facilitated and underpinned by an evolved adtech industry of which Unruly is part.

I hear the ICO released an important report recently?

In June, the ICO (the UK “data protection authority”) released their ‘Update Report Into Adtech and Real-Time Bidding’ report. It focuses on the legalities and contractual complexities of the adtech supply chain via RTB.

It surmises that the “adtech industry appears immature in its understanding of data protection requirements. While the automated delivery of ad impressions is here to stay, we have general, systemic concerns around the level of compliance of RTB”.

Tell me more about the Report…

A large part of the Report focuses on RTB and the ICO lays out its concerns around general levels of compliance to both the GDPR (General Data Protection Regulation) and PECR (Privacy and Electronic Communications Regulations). My top four takeaways (from the 25-page report) are as follows:

  • Many companies currently rely on legitimate interests as a legal basis where it may not be appropriate to do so
  • For special category data, a company always needs explicit consent
  • Privacy information provided to users isn’t clear
  • One bid request can share a user’s personal data across hundreds of organisations via the programmatic network  
What does this mean for advertisers and publishers?

The ICO has advised the industry which includes vendors, publishers and advertisers that they have six months to “re-evaluate their approach to privacy notices, use of personal data, and the lawful bases they apply with the RTB ecosystem”. 

In the meantime, the ICO will continue to fact find, engage with key stakeholders and work with other Data Protection Authorities. If these changes limit inventory available for targeting then inevitably more advertising revenue could flow to GAFA where advertisers can find data-rich walled gardens.

The Unruly view 

The role of the ICO is to uphold data protection laws, not to kill the advertising or publishing industry. They are having to tread a fine line between protecting consumers, abiding by laws and stifling industry growth.

The IAB Europe represents the Ad Tech industry’s voice with the ICO and the IAB TCF v2.0 will give some clarity on how the industry can collectively proceed. Ultimately, it isn’t RTB per se that the ICO has an issue with, it’s the sharing of personal data within it. However without targeting what is the value of the RTB? Should we be looking for a new mechanism and way of valuing impressions?

Read more of our A-Z of Adtech series for a comprehensive overview of how the Adtech sector looks today.