WEDNESDAY JULY 6th 2020

The European Parliament has agreed on the Digital Services Act (DSA), a package of bills that would wrap red tape around Big Tech activities in the EU. If it is approved, the DSA could go into effect as soon as 2024, which means that ad targeting will get even more limited. Tech giants will no longer be able to target users based on their personal data, and they will also be required to give users more control over their data.

In addition, the DSA would create a new regulator to oversee the tech industry, and it would impose heavy fines on companies that violate the rules. The DSA is still awaiting formal approval by EU institutions, but if it goes into effect, it could have a major impact on the way that Big Tech does business in Europe.

The DSA (Digital Standardization Agency) would also prohibit the use of “dark patterns” in digital products and services. Dark patterns are deceptive strategies that manipulate users into buying products or services that they might not otherwise purchase. For example, a common dark pattern is the “bait and switch,” in which a user is lured in by a low-priced item, only to be switched to a more expensive product when they try to check out.

Other examples of dark patterns include false deadlines, hidden fees, and forced continuance (such as when a user is automatically enrolled in a subscription after completing a free trial). 

If you’re an e-commerce platform that does business in the European Union, you’ll need to start monitoring your markets more closely. The EU’s Direct Selling Association (DSA) has tasked platforms like Amazon with preventing the sales of illegal goods. Depending on what you’re selling, the act could complicate things for merchants and marketers.

The DSA’s new measure is designed to protect consumers from being scammed by illegal businesses, but it could also create headaches for e-commerce platforms that will now need to vet every merchant more carefully. In addition, the DSA’s measure could also make it more difficult for small businesses to sell their products online

For e-commerce platforms, the best course of action is to stay compliant with the DSA’s new regulations and monitor their markets closely to ensure that only legal products are being sold.

Also, the European Commission has proposed new rules that would require tech companies to take down illegal material such as hate speech, incitement to terrorism and child sexual abuse.

The rules would also require e-commerce marketplaces like Amazon to prevent sales of illegal goods. The proposals are part of a wider effort to regulate the tech sector in Europe.

Critics say the proposals could lead to censorship and stifle free speech. The Commission says the rules would only apply to illegal material and would not restrict legitimate speech. 

Last month, EU institutions approved the Digital Markets Act (DMA), which seeks to curb the market power of Big Tech firms. The DMA covers a wider range of areas than the DSA, but the two concepts are closely linked. In particular, the DSA is likely to include provisions that would make it easier for national authorities to enforce the DMA. For example, the DSA could give national authorities the power to order platforms to take down illegal content or to stop using certain algorithms that amplify fake news.

The DSA is also likely to include rules on so-called "gatekeepers", which are platforms that play an important role in connecting businesses and consumers. These rules could include requirements that such platforms give businesses access to data on their users, or that they allow businesses to port their data to other platforms.

The new EU rules are a good step, but they do not go far enough. Washington should look to the example of the EU in regulating Big Tech and enact similar measures to protect consumers and democracy online.

The Rundown
 

At least 10 News Stories you Must Know

1. McDonald's is the first major sponsor of OfflineTV, a collective of online content creators focused on the gaming space. The partnership will encompass sponsored livestreams, integrated content and in-person events like conventions. It had a soft launch last weekend at Anime Expo with a booth where fans could snap photos with their favorite OfflineTV personalities and buy limited-edition merchandise. McDonald's director of global media Steve Easterbrook said the sponsorship is part of the company's ongoing efforts to reach out to gamers. "This is another step in our journey to becoming a more relevant and modern brand," he said. "We're always looking for new ways to connect with our target audience, and this partnership allows us to do just that." For its part, OfflineTV said it was excited to partner with a "family-friendly" brand like McDonald's. "We're constantly looking for ways to grow our community and reach new audiences," said chief operating officer Shelby Wang. "This partnership will help us do just that."The sponsorship is the latest example of how brands are tapping into the growing world of professional gaming. In recent years, companies like Red Bull, Nike and Intel have all launched initiatives aimed at connecting with gamers. And McDonald's is no stranger to the gaming

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2. Meta, the company behind the popular social media platform Facebook, has launched two new legal actions against data scraping sites. These sites have extracted user data from both Instagram and Facebook without authorization, and Meta is seeking to halt their activities and recover damages. In addition, Meta has seen a new victory in its battle against platform misuse, with a court ruling in its favor in another case related to clone sites. This ruling will allow Meta to take action against clones of its site that are used for illegal or unauthorized purposes. These latest developments underscore Meta's commitment to protecting its users' data and preventing misuse of its platform.

3.TikTok is testing a new setting that will allow users to restrict their livestreams to viewers who are 18 years of age and above. The new setting, which is currently being beta tested in select markets, will give users the option to select an age limit for their livestreams. TikTok has not yet said when or if the new setting will be made available globally. The age-restricted livestream setting is just the latest in a series of steps that TikTok has taken to address concerns about the app's safety and security. In recent months, TikTok has faced intense scrutiny over its handling of user data and its failure to protect young users from inappropriate content. The app has also been criticized for its lack of transparency around moderation and content marketing_20 policies. While the new age-restricted livestream setting is a welcome step, it remains to be seen whether it will be enough to quell critics' concerns.

4.  The Financial Times has published an article detailing the issues that have plagued the TikTok Shop platform in the U.K. After dealing with cultural clashes and poor sales, TikTok owner Bytedance has reportedly decided to halt its shopping feature’s expansion. According to the article, TikTok Shop launched in the U.K. in October 2020 with a focus on selling beauty and fashion products to Gen Z consumers. However, the platform quickly ran into trouble when it was accused of cultural appropriation for featuring products that were not appropriate for the Western market. In addition, TikTok Shop’s sales have been disappointing, leading Bytedance to reevaluate its strategy for the platform. It is currently unclear if or when TikTok Shop will relaunch in the U.K., but the company’s struggles in launching the platform highlight the difficulties of expanding into new markets.

5. Starting this week, Snap will begin offering an optional subscription called Snapchat Plus that unlocks exclusive and early access features. Priced at $3.99 a month, the subscription is geared toward “the people who spend most of their time communicating with their closest friends on Snap,” according to a blog post from the company. Subscribers will have access to new features like group video chat, custom Friendmojis, and advanced search options. They will also be able to use Snapchat's filters and lenses before they become available to the general public. In addition, Plus subscribers will receive priority customer support and early access to new products and features. The subscription will be available in select markets at first, but Snap plans to roll it out globally later this year. For those who don't want to pay for the Plus subscription, don't worry: all of Snapchat's existing features will remain free.

6. Email ad server Passendo, is partnering with media company audienzz to launch an email newsletter advertising network that will focus on Switzerland.

The arrangement will help advertisers “land directly within their target groups’ mailboxes via in-email ads,” says Nora Chapero, head of business development at audienzz.

7. According to a new report, Google may have accidentally provided user data to a Russian state-owned bank. RuTarget, the advertising-technology firm owned by Sberbank, reportedly had access to Google user data until late June. The data included mobile phone IDs, IP addresses, location information, and details about users’ interests and online activity. It is not clear how the data was accessed or how many users were affected. Publishers who are connected to Google also may have been unknowingly involved. Google is investigating the matter and has not commented publicly on the reports.

8. Matthew Bogusz, a long-time agency media exec, has joined Havas Media Group North America as a managing partner and head of growth. Bogusz, who reports to HMG NA CEO Greg Walsh, joins from Novus Media, where he was vice president and managing director of digital. He has also held senior media roles at Publicis' Zenith and Starcom units. In his new role, Bogusz will be responsible for leading Havas Media Group's growth strategy in North America. "I am thrilled to be joining Havas Media Group at such an exciting time," said Bogusz. "Havas is a dynamic and forward-thinking company, and I look forward to working with the team to continue driving growth in North America."

9. Cadillac and Atlanta-based rapper and activist Killer Mike have partnered for a video and social media campaign. The spot, titled “Bold, Brilliant and Bespoke,” celebrates musical pioneers and innovators, according to the automaker. Killer Mike is half of hip hop duo Run the Jewels, and has been an outspoken advocate for social justice. In the spot, he talks about how music can bring people together and inspire change. “Through our partnership with Cadillac, we want to shine a light on the power of music to unite us and bring about positive change,” he said. The campaign will also include a series of social media videos featuring Killer Mike talking about his favorite musical pioneers.

10. A new study by the consulting firm Frost & Sullivan finds that automation can help sales teams hit their targets, while integrated sales and marketing teams are more likely to exceed forecast revenue. The study, which surveyed sales and marketing professionals in the United States, found that companies that increased their marketing spend in 2021 were more likely to see higher revenues. This was especially true for companies that integrated their sales and marketing teams. According to the study, “sales teams that are supported by an integrated sales and marketing function are 1.6 times more likely to exceed forecast revenue.” Frost & Sullivan also found that automation can help sales teams improve their productivity. The study found that “sales organizations that have adopted automation technologies are 1.7 times more likely to hit their targets.”

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