How new rules could create a more trustworthy online ecosystem

The much-vaunted adoption of the European Union’s Digital Services Act (DSA) and Digital Markets Act (DMA) presents big opportunities for advertisers and for consumers alike.

The flagship regulations are designed to tackle hate speech, terrorist propaganda and other illegal content and create a fairer and more competitive digital ecosystem.

While these might be EU-only rules now, they will inevitably have global influence. As with the EU’s General Data Protection Regulation, policymakers across the world, including the U.S., will be watching closely and taking note as they mull introducing similar laws in their own jurisdictions.

Final details still need to be resolved but as it stands it looks as if the new EU digital rulebook will contribute to a safer and more transparent internet for consumers, businesses and society at large, repairing some of the structural shortcomings of today’s digital economy.

Shouldn’t people know who the advertiser behind an ad is and why they have been targeted? Consumers should not have to shoulder the burden of understanding how their data is collected, who it is being shared with and why it is being used for advertising purposes.

This is why we support the new user-centric rules in the DSA, which will give people a right to meaningful transparency. We also welcome the worthy intention of introducing restrictions on behavioral advertising to prevent the discriminatory display of ads and protect minors online.

If the DSA truly delivers on its promise, then these measures will help drive accountability and responsibility in the ecosystem. It will foster trust that the digital advertising business is actually working with the consumer’s interests in mind and not simply in favor of those with a stake in the online ecosystem. And that has to be a good thing, longer-term.

The new rules will also help create a more diverse and competitive digital advertising market that works with advertiser interests in mind. If applied effectively, these two regulations will go some way toward lifting the lid on some of the challenges brands have been grappling with for several years around transparency and brand safety.

New statutory rules requiring online platforms to prevent illegal content on their services and to be transparent for the way they moderate content will support industry efforts such as the Global Alliance for Responsible Media (GARM). This will help brands’ efforts to eliminate financial support for content peddled by unscrupulous actors. 

In parallel, obligations under the Digital Markets Act will finally help deliver much-needed transparency from a small number of large online platforms. With the right checks in place, advertisers will be able to independently verify the performance of the advertising services they purchase and better audit ad spend. This is a crucial step toward creating a more balanced digital advertising market.

As ever with the digital ecosystem, the devil will be in the detail, and uncertainty remains about how some of these obligations will work in practice. The WFA will be eagerly awaiting clarifications on the final texts and will be keeping a watchful eye at how the ecosystem adjusts to meet this new regulatory mandate.

Will the new rules solve all of the problems of the online ecosystem? Probably not. But if policymakers get the details right, the DSA and DMA could set a global standard and finally right at least some of the wrongs of the digital economy.  

This article originally appeared in Ad Age here.