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Committee Hears Search Engine Maintains Profit While Limiting Targeted Advertising

DuckDuckGo argued that its contextual ads are effective and not intrusive.



Screenshot of Katie McInnis' testimony from consumer protection subcommittee on Tuesday

WASHINGTON, March 2, 2022 – The House consumer protection subcommittee on Tuesday heard from a search engine company that said it has successfully been able to maintain a profitable business model while limiting the reach of its targeted advertisements.

The committee was discussing the Banning Surveillance Advertising Act of 2022 — a bill sponsored by Sen. Cory Booker, D-N.J., and introduced in January of 2022 — which would outlaw “surveillance” advertising utilized by large tech platforms that passively collects data on users to build a profile, but which is not easily accessible to the user.

The legislation, however, would still allow for limited contextual targeted advertising, which is specifically tailored to what the user is looking at in that moment.

“Virtual advertisements are based on the content being shown on the screen and do not even know anything about you,” said witness Katie McInnis, public policy manager at DuckDuckGo, a search engine that prioritizes consumer privacy.

“So, if you go to DuckDuckGo and perform a search – let’s say you search for mobile phones – we are going to serve you with ads for phones. It is as simple as that,” she said, adding it’s far less invasive than what are called behavioral advertising.

“Behavioral advertising, by contrast, is based on personal profiles from data collected both on and offline about you,” McInnis said. “That’s surveillance advertising. And rather than finding these ads useful, a majority of Americans say that this is a mis-appropriate use of their data. And it’s no surprise as a massive violation of their user privacy and data collection expectations,” she said.

Company says it’s making money

To pass such a bill, legislators would need to know what kind of monetary impact this would have on businesses that rely on advertising models.

Jan Schakowsky, D-Ill., asked whether the search engine has been able to remain profitable despite the limited reach of its advertising model.

“Yes, we are very profitable,” McInnes responded. “Our revenue is somewhere around $100 million per year, we have over 30 million US users in the United States, and they span the whole nation and the political spectrum.”

Rep. Tony Cárdenas, D-Calif., said that he would venture to guess that $100 million “is a slow day for Facebook,” adding, “I pray that DuckDuckGo can actually continue to succeed in this environment, because we are talking about companies that [have a] net worth a trillion dollars or more and the reason why I point that out is because they choose not to use good practices. They choose not to have practices that have respect for other people who are using their platforms.”

McInnis said that if the Surveillance Advertising Act is adopted, it will allow other companies to compete in a more meaningful way and contribute to a healthier online ecosystem overall.

“If this bill was enacted, many companies would be prevented from the collection of online data, meaning that Facebook and Google’s duopoly and ads would be diminished,” she said. “Companies would be able to compete against them more forcefully in the market, and we would have more innovative contextual advertisement services for users, and therefore the ads will be more relevant and more useful to users in the future.”

Reporter Ben Kahn is a graduate of University of Baltimore and the National Journalism Center. His work has appeared in Broadband Breakfast, Washington Jewish Week, and The Center Square, among other publications. He primarily covers Big Tech and spectrum policy.

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Lawmakers, FCC Take More Action Against Illegal Robocallers

There are new proposed rules that offer legal protections to those aiding in enforcement efforts against illegal robocalls.



Rep. Bob Latta, the primary sponsor of the Robocall Trace Back Enhancement Act

WASHINGTON, April 27, 2022 – Regulators and legislators in Washington continued their efforts to curb unlawful telephony use with proposed rules designed to crack down robocalls.

On Wednesday, Rep. Bob Latta, R-Ohio, introduced the Robocall Trace Back Enhancement Act – an amendment to the Pallone-Thune Telephone Robocall Abuse Criminal Enforcement and Deterrence Act.

If signed into law, the bill would provide legal immunity for a broad range of entities engaging in private efforts to track, surveil, and report on illegal robocalling scams.

The protected parties include registered consortiums that handle call receiving, sharing, and publishing and all voice service providers and any informants that share covered information.

It would also grant the Federal Communications Commission jurisdiction to take enforcement actions based on the information collected during the aforementioned activities.

FCC measures on cease-and-desist letters

In addition to this legislation, as part of her agenda to combat scam calls, on April 26 FCC Chairwoman Jessica Rosenworcel proposed closing a loophole to the STIR/SHAKEN regime afforded to small telcos.

Most telcos are required to adhere to cease-and-desist orders regarding illegal spam-calls and generally comply with actions taken by the FCC. The loophole in question gave smaller telcos greater latitude in how they chose to respond to FCC requests.

If adopted, the proposed regulation would require small telcos to abide by cease-and-desist orders, participate in robocall mitigation, cooperate with FCC enforcement, and take responsibility for facilitating illegal robocall traffic.

“International robocallers use these gateways to enter our phone networks and defraud American consumers,” Rosenworcel said in a statement, “We won’t allow them to bypass our laws and hide from enforcement.”

The new rule will be voted on at the FCC’s open meeting on May 19.

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Federal Privacy Legislation Needed As State Legislation Could Harm Smaller Players, Event Hears

Different state privacy laws stifle competition and places burdens on small companies, experts say.



Maneesha Mithal (far-left), Sara Collins (middle-left), Lartease Tiffith (middle-right), Brandon Pugh (far-right) on stage at "Beyond the Basics: The Many Pillars of a U.S. Privacy Law"

WASHINGTON, April 25, 2022 – While experts agreed that federal legislators need to take action on comprehensive privacy legislation, they disagreed on the specifics of how such regulation should be enforced.

Though some states have begun to establish their own frameworks for consumer privacy regulation, each framework puts forth different standards that online platforms would have to adhere to. These varied frameworks have raised concerns among many experts who consider a patchwork of legislation to raise the bar of compliance – a bar that could be lowered by federal legislation.

During an R Street panel on Monday, experts from the technology industry weighed in on the matter with their perspectives.

In March, Utah joined  California, Colorado, and Virginia and became the fourth state to successfully pass consumer privacy legislation. Several additional states, including Florida, Massachusetts, New York, and Connecticut have experienced mixed success with their bills and have not yet signed anything into law.

Lartease Tiffith, executive vice president for public policy at the Interactive Advertising Bureau, said that the US is an outlier among developed countries. “We are one of the few developed countries that [does not have a federal privacy law],” he said. “I think that in order to reflect the same common values as our colleagues who are in Europe and elsewhere around the world, we need [to make] one.”

Beyond the international perspective, Tiffith also emphasized domestic justifications for federal legislation. “I cannot think of a subject matter that is not more under the purview of Congress than interstate commerce,” he said. “The internet is everywhere – it is not limited by borders. So, we need to have one standard, one set of laws. It should not matter where you live – California, Utah, Virginia, Colorado – you should have the same basic privacy rights as anyone, anywhere.”

Various state legislation harder for smaller companies

Tiffith also explained that a patchwork of regulation would hit smaller businesses the hardest. “If you are a small or medium sized business and you are looking at investing more money into your products and service and delivering and reaching customers – you want to do that rather than spending time on hiring more lawyers to deal with ever complicating regulations.

“We need this for the next set of Amazons and Googles of the world to exists,” he said.

While the panelists were able to agree on the fact that current patchwork of laws is not sustainable, they did not agree on how to enforce a federal framework.

A federal body for consumer data protection

Sara Collins, senior policy counsel for internet advocacy group Public Knowledge, voiced benefits to creating a new data protection authority in the US – a body distinct from the Federal Trade Commission – that would focus expressly on matters related to consumer data protection.

Tiffith pushed back, however, arguing that the FTC already does a good job at handling these issues, and is only held back by what he views as under-resourcing. “If you compare the FTC to other protection authorities, they are very under-resourced,” he said. “So, I think instead of us standing up a whole new data protection authority, I think instead, let’s invest that money in the FTC, give them some rules, some limited rulemaking authority, and let’s give them a lot more staff and a lot more money.

“Let them be the cop on the beat,” he said.

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FCC Announces Majority of States Now Signed Onto Robocall Investigation Partnership

The FCC signed on five states this month and seven last month.



Illustration from C-Zentrix

WASHINGTON, April 7, 2022 – The Federal Communications Commission said Thursday it has partnered with further five more state attorneys general to combat illegal robocalls.

The agency said Thursday it had signed on Alaska, California, Tennessee, Pennsylvania and Washington state to investigate the robocalls, which can lead to scams. Thursday’s news comes on the heels of a March 28 announcement, when the agency said it signed similar memorandum of understanding with Connecticut, the District of Columbia, Idaho, Kentucky, Minnesota, New Jersey, and Wyoming.

Altogether, the agency, which announced the federal-state partnership effort in February, said it has signed on the majority of the United States.

“It shows that we are united when it comes to fighting robocalls—urban, rural, north, south, east, and west,” said FCC Chairwoman Jessica Rosenworcel. “Today I invite every state and U.S. territory to join this effort and establish information sharing and cooperation structures with the FCC so we can work together to investigate and put an end to spoofing and robocall scam campaigns.”

The agency, which has made fighting illegal robocalls a key mandate, has previously credited states with catching those that allow robocalls.

Earlier this month, the FCC credited the North Carolina Department of Justice in an investigation that identified thinQ Technologies as a “facilitator” of robocalls. The agency, which is working with the Traceback Consortium to identify the culprits, has already sent more than a dozen cease and desist letters to those it has identified in investigations.

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