Brief – Defining Contextual Advertising
Over the past quarter-century, behaviorally targeted advertising has become entrenched as one of the dominant business models for online publishers, social media platforms, mobile apps, and other web-based content, products, and services. A vast industry dedicated to collecting, analyzing, and monetizing data about virtually every aspect of people’s lives, comprising data brokers and various kinds of ad-tech intermediaries, forms the backbone of this ecosystem. The global digital advertising market is projected to reach US$740.3bn in 2024.
In response to a range of harms associated with behaviorally-targeted advertising, policymakers in the United States, European Union, and beyond have signaled an interest in using law and regulation to incentivize a shift toward more privacy-respecting advertising. In CDT’s view, policymakers should foster a competitive online advertising ecosystem that respects privacy and other human rights, supports independent media, enables the creation and availability of content—including from journalists and artists—and is accountable to the public, advertisers, publishers, and government regulators. Online advertising can and should be both privacy-respecting and economically viable.
Advertising in such an ecosystem could take many forms, one of which is contextual advertising. The initial discussion draft of the American Privacy Rights Act (the U.S. Congress’s latest attempt at bipartisan comprehensive federal privacy legislation) described contextual advertising as “when an advertisement is displayed online based on the content of the webpage or online service on which the advertisement appears.” But that neither represents a consensus understanding of contextual advertising nor answers a number of important questions about its scope. For example, some companies offer so-called “contextual advertising” services that rely on both contextual and behavioral data, as well as “cookieless” ad products that purport to respect individual privacy while replacing cookies with alternative persistent identifiers. CDT’s stakeholder consultations in preparation for this report underscored the divergent views held by civil society and industry actors with respect to how “contextual advertising” should be defined.
To have a productive debate, and for law and regulation to establish understandable ground rules, we need clear, consistent, technically-grounded definitions that can be written into law and standards. While jurisdictions may ultimately vary in the restrictions they impose on different types of ads, public debate and policy-making will be well-served by common definitions. This report intends to fill that gap with respect to terminology about contextual advertising. CDT hopes that defining “contextual advertising” in dialogue with experts from both industry and civil society will be a first step toward developing a common understanding.
