Targeted Ads Become Focal Point Of Digital Competition Debate

(MENAFN- Live Mint) "New Delhi: The way technology firms tap internet users' data in order to flood them with advertisements has become a focal point of the debate on India's proposed law on regulating big tech firms draft Digital Competition Bill prepared by the Ministry of corporate affairs is open for public inputs now bars“inter-mixing or cross-using” of data from different services offered by digital Economy firms without user consent - an aimed at ensuring a level playing field in the digital economy.
However, industry executives say this will come in the way of application developers monetizing their platforms Bill lists 'advertising services' as a 'core digital service' along with eight others-online search engines, online social networking sites, interpersonal communication services, operating systems, web browsers, video sharing platform service, cloud services and online intermediation services data of consumers from one service – search engines for instance -- for using on another, such as advertising, requires user consent.
Consumers denying consent would block application developers like online gaming firms or payment applications and social media networks from monetizing their business through ads, said an industry executive from a large digital economy firm who spoke on condition of anonymity email sent to the spokesperson for then ministry of corporate affairs on Tuesday seeking comments for the story remained unanswered at the time of publishing. However, a person informed about discussions in the government said the ministry has extended the public feedback period on the draft Bill that started mid-March by another month till 15 May.
“Once stakeholders spell out any concerns, the government will look into them,” the person said extensionOn Monday, 21 think tanks and industry associations and several experts wrote to the ministry requesting an extension of the public consultation period by another five months till 15 October, saying that the bill's potentially wide impact on the digital economy requires in-depth, evidence-based analysis India (Forum for Internet, Retailers, Sellers & Traders), a division of not-for profit organization India SME Forum (ISF), wrote to the ministry on 11 April saying concerns were raised during its consultation with experts that the draft law, inspired by the EU's Digital Markets Act, may stifle opportunities for Indian MSMEs that are heavily reliant on digital platforms for targeted advertising, identification, and discovery services.
Restricting such practices could significantly impact customer acquisition, cost savings, and accessibility for MSMEs, the forum said. Mint has seen a copy of the letter.“Today, advertisements have become more efficient, targeted and low cost as you need not show them in expensive broadcast platforms for niche products. Many small businesses today use online advertisements to reach consumers,” the executive quoted above said.
Advertisements cannot per se be a core digital service and this restriction makes it difficult to monetize applications, argued the executive. With this provision, offering a bouquet of services under one platform will be difficult, said the executive proposed restriction on cross-use of data was suggensted by an expert panel that recommended“behaviour obligations” for large digital economy firms to be identified on the basis of their financial strength and market presence.
The panel, in its report to the government in February, had highlighted how cross-use of data from different services allowed some large digital enterprises to get what it regarded as“unfair edge over the market.”
Big tech firms make innovations using their access to vast stores of user data and entrench their position in the market, thereby attracting more users and thus access even more data. Their access to consumer's personal data creates entry barriers in digital markets for new players, thus distorting the level playing field for smaller digital enterprises and restricting competition in the market, the panel had said.

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