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E-Privacy and Europe’s stop-go approach to digital transformation

Starting tomorrow, the Maltese Council Presidency and the European Commission will hold the EU’s annual  Digital Assembly in Valetta.  It is worth taking a moment to contemplate the irony of the Commission co-hosting a high-level conference to “look ahead at how Europe and its partners around the world are preparing” for the coming digital transformation, while in a parallel universe in Brussels, DG CONNECT is defending a proposed Regulation on ePrivacy that would dismantle the Internet’s dominant business model, making access to information, entertainment and online services for consumers and small-businesses a pure pay-as-you-go proposition.

The ePrivacy proposal will make almost any interaction with a user’s device subject to the consent legal basis as defined in the General Data Protection Regulation (GDPR).  Consent under GDPR comes with heavy baggage.  If the site or online service needs to do any data processing beyond what is necessary to render the pages on the screen – for example, heaven forbid, to deliver interest-based advertising to keep the lights on and pay its staff – then arguably consent cannot be used.

And under the ePrivacy proposal, if consent is not available, then there is NO legal basis.

The proposed approach is so self-evidently disproportionate that hyperbolic justifications with little or no basis in fact are energetically adduced to defend it.

Thus, the ePrivacy proposal is supposedly necessary to protect consumers from “secret online tracking” – though the GDPR comprehensively and emphatically eliminates any scope for secret tracking.

Similarly, we are told that new rules are needed to protect privacy, as a distinct right from data protection – and yet in the same breath it is affirmed that all of the data covered by the ePrivacy proposal are personal data anyway.

The Commission promises the new rules will get rid of those annoying cookie banners, a boon to European internauts driven to distraction by constant interruptions. In reality, to be able to say with any certainty that users have given consent, banners are here to stay. If anything, the ePrivacy proposal will require them to be more annoying.

Finally there is the argument that consent is not new, as it has been required by the ePrivacy Directive since 2009.  What is the digital advertising industry complaining about?  Yet this too is at best a diversion, or half-truth.  First, the GDPR already clearly regulates cookies and other online identifiers, so it was anything but inevitable that new cookie rules would need to be adopted to replace the 2002 Directive with anything but a repeal of the specific cookie rules.  Second, only the Netherlands had a strict and enforced opt-in approach without alternative legal bases. An approach of only opt-in consent will be new to around 96% of EU citizens.

In the environment of hysteria over tracking that currently grips Brussels, where accessing free information online in exchange for seeing ads is seriously compared to selling one’s organs (EDPS Opinion 04/2017, page 7), the proposed solution is that consumers should pay for content.  Subscription is morally preferable to digital advertising, whose supporters will simply need to come round to the realization that they are on the wrong side of history.

This presupposes a false dichotomy – advertising-based models versus subscription models – when in fact most media need both options at the same time, plus anything else they can think of to generate revenue in the difficult transition to digital.  Yes, some citizens will be able to pay for some content and services.  But no one will pay for everything.  The inevitable outcome will be less revenue going to support media and other online content, leading to a general impoverishment of the information and online service landscape, and the emergence of a two-tier digital society in which those who can afford it will at least have access to that impoverished landscape, and those who cannot will have nothing.

So at least as far as ePrivacy goes, there will not be much to celebrate at Valetta – though the warm breeze and cocktails will provide a certain distraction from these uncomfortable truths.

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