Alan Chappelle (5:54)

Yeah, yeah, I just want to frame one additional thing and you said this, but I just want to drive this home to the audience. I mean they took an ecosystem that was effectively a notice and opt out ecosystem and then bifurcated that ecosystem where for just about everybody else it was now an opt in consent ecosystem. And then for Apple's own first party targeting it was an, effectively an opt out ecosystem.

Eric Suefert (6:19)

So no, so it was, it's opt in as well. Right. So within Apple's own domain you do have to opt in, but we'll get to the differences there. And that's kind of the substance of this, of this opinion. But yeah, it was opt in for Apple too. But and we'll talk about. The presentation was different, the depiction was different, but also the use of the data was bifurcated. Right. So the use of the data and we can talk about the differences. Maybe it's important to talk about the differences now. So I wrote this piece like kind of in the immediate aftermath of ATT was I said ATT benefits Apple's own ad network. Right. And I kind of went through the reasons why. One of them is the consent prompt. Right. So you do have to give Apple consent to collect your data and use it for ad ad targeting measurement. But they have a full page prompt that they present to you and it has a lot of context. It explains the benefits of you opting in. You know, has like just quite a bit of text that they get the benefit of to utilize to make the case. Whereas the ATT prompt is one sentence. In addition to that, Apple depicts their usage of this data as personalized advertising. Right. So the product of this data is personalized advertising. That's how they depict it. Whereas they call it Tracking right in the ATT prompt, right? So this is just in, just, just, just in this sort of like in the, in the initial sort of interface with the user to sort of collect that consent, they deploy a very different prompt mechanic than, than what they allow advertisers that the app owners to present, right? So that's one difference. But I think the more substantive difference here, the way in which they're allowed to collect data. Apple, right, they own the iOS, right? So they, that's their, it's. They, they own the os, right, that exists on the phone and they also prevent anyone from using alternative monetization mechanics in apps that are published on iOS. Now this is a subject of a lot of debate in Europe with the dma, but in the US it's still kind of low late now. There's some changes that have happened and there's a link out now and some other things. But for the most part, if you want to monetize in the app with an iap, you have to use Apple system, right? And so what Apple said was, okay, well look, we want to prevent third parties from collecting this data and using it for ads targeting unless the user kind of consented to that, right? And so that is what broke the, breaking the IDFA and breaking the usage of any sort of like data that was collected in the app to send to some third party was the, was the point, right? That was the objective. Now what Apple says is, yeah, okay, well that's data changing context. That's going from a first party context where the app collects it to a third party context. Like if you send it to Facebook, you send that data to somebody else. It's third party data and that cannot be used for ad targeting. What Apple does is it says, well, we don't have any sort of third party context that's applicable here because we own the os, we're the only payments processor, we're the only app store that can exist on iOS. And so if someone engages on iOS, that's all first party data to us, right? Even if it's in within an app that's published on iOS, that's first party data to us. Because, well, how else could they monetize? How else could they transact except to use our payment system and our app store to download the app? So we have that data, right? We have that data available to us, right? And it's, it's first party to us.

Alan Chappelle (9:25)

I get the, the distinctions being drawn here is that that Apple has basically taken the position that anything goes through their plumbing Is, is a first party and then really everything else is, is sort of a third party. That, that at some point becomes a weird and dubious distinction. Like, you know, is everything going through Shopify's plumbing, you know, by definition first party? Because it's certainly not clear that to a user that, that, you know, as you travel from, you know, one of their, know, place it to the other. And so in my mind at least that it just becomes a very, very difficult, thorny way of trying to draw a distinction.

Eric Suefert (9:58)

There's one more piece to this, right? So like what Apple made available to advertisers with, you know, in the, in the absence of the opt out is this thing called Ski Network, right? And so they, they could use Ski Network for doing advertising measurement. It was a replacement for the idfa, right? And so it was just this very convoluted framework for doing advertising measurement like privacy. They have advertising measurement and there's just a lot of friction that they introduced to that to make it sort of privacy safe. They have their own advertising measurement system, right, that is proprietary to them, that has none of those limitations. And so, you know, they force advertisers to use this, this basically dysfunctional framework, Ski Network in the case of an opt out. But then they have the privilege of their own advertising system that plugs into their own data set which they claim is first party, but actually is sourced from third party apps, apps that are produced by. Not them. And they get to claim it's first party. Right? And so, and so that's the distinction here. So like if you get the opt in, well then all this stuff can happen if you get the opt out. Like Apple had these advantages that only applied to them, right? In terms of the tech they got to use for measurements, in terms of the data they got access to. Because it's not third, it's not third party. It's not third party because they own the OS and everything in that OS is first party to them. So those are the distinctions there. There's a prompt. It was the measurement framework and it was just the access to the data.

Alan Chappelle (11:17)

No, and it makes sense. And so, and so there was a complaint, and there's been numerous complaints, particularly in Europe. The one we're talking about today is the one that started, I think in June of 2022. Somebody complained to the German Cartel Competition Authority. And then we just got kind of a preliminary decision today. And I think that they, they came to a similar conclusion that you are, which is like, hold on a minute, you're taking one set of data and you're allowing that to be treated one way and you're taking your own data and you're treating that entirely differently. And that by definition, at least according to the preliminary opinion, that has a negative impact on competition. And therefore. You know, by the way, we should get to the therefore, because I'm not even sure what the therefore is. I mean, are we bringing IDFA back to, you know, like five years ago? Are we just going to continue to fine Apple? Like, what's the, you know, if you could wave your magic wand, like, what's the remedy here?

Eric Suefert (12:09)

Well, that's a great question. So, like, as you pointed out, it's just sort of like preliminary opinion. And like, I'm not an expert in like, sort of EU procedural law by any means, but I have friends who are. Right. So I consulted someone who's appeared on the Molded Memo podcast a number of times, a man named Mikway Barinowicz, who's an EU law expert. He's a law professor at the University of Surrey. And what he told me was that essentially this preliminary opinion kind of serves as a decision now. And I mean, I might be misinterpreting what he wrote, so don't take this as like, is like gospel, but it serves as a preliminary decision. And so there is no, there's no remedy yet, but there will have to be. And what Apple can do is they can appeal. They would appeal to sort of like the, the Supreme Court of Germany. Right. But you know, this, this isn't like an E. There's got like, there's no like EU wide scope here, but it could serve as a precedent. Right. What could happen now is like this, this preliminary view could evolve like essentially into some sort of basis for, for applying a revity. Now, I was contacted by the team that pushed us forward early on, the German team that pushes forward early on. I didn't really follow up. So I, I don't, I don't really know what the next steps are. My sense is that now keep in mind this is like the German cartel office. I'm not going to try to pronounce the word in German.

Alan Chappelle (13:22)

Yeah, I've been avoiding all day.

Eric Suefert (13:24)

They remember they, they had a case with, with Meta, right. And then that went to the CJ EU and that got decided and that turned into EU Wide law. But I think there's like a new process that's been applied in Germany since then. So I think the appeal would then go to just the court system in Germany. But my sense is like, this would not roll back att. My sense is what this would force Apple to do would be to like basically compete on equal footing with the other companies that want to offer personalized advertising. And so either give them the same ability with the prompt to make the case, open up the tech for ads, measurements that is available to them to the broader ecosystem and then you know, maybe could have something to do with the payments, but I doubt it would go that far. So my sense is like you probably just get like a better consent prompt or maybe like they sort of unify the functionality across those two measurement frameworks. But I don't think this would roll back adt.

Alan Chappelle (14:12)

Yeah, I tend to think so too. Although I've seen some people out there on the, on the interwebs talking about that as if that's even a possibility. And to me that just seems so sort of. I don't want to say it's absurd, but I kind of feel like the mobile marketplace has sort of conceded addressability. You know, I mean with all the talk about the privacy sandbox in Chrome, there's very few people who are even talking about, you know, the, the fact that they're, you know, deprecating, you know, the Google Ad id. And I mean that's a fait accompli. I mean that's, that's just a matter of time before that happens.

Eric Suefert (14:43)

I mean, we can talk about that too. I think. You know, my, my interpretation of Google's kind of approach here or the change in approach is that it ultimately ends up having the same effect, but they get the COVID of well, so, so maybe explain what that is for those who aren't aware, like what, what Google did was they said, okay, we're, we're, you know, we've been going back and forth with the CMA for years on this. I don't see us converging here. So what we're going to do is we're not going to deprecate the cookie wholesale, the third party cookie wholesale on Chrome. We're just going to let people opt in or opt out. My sense is like they'd implement it in the same way with the same sort of heavy handedness of att. Now obviously it's not website by website, it's broadly at the browser level. So there is a fundamental difference there between that and, but, but my point was like I was comparing it to this in the sense of like we're going to put our thumb in the scale to try to try to drive the outcome that we want, which is that the user Opts out because there's every reason to believe that Google is very motivated to have the cookie be essentially deprecated, right? Because I think they would benefit in a lot of ways from if that happened. And so if we do that then we get the COVID of well look, the users decided like we didn't make any decision of their own volition. They decided to sort of opt out of cookies broadly across every website that they view in the Chrome browser. It'll have the same effect. And you know, the CMA just like the FTC had a leadership change, right. And sort of, I think the sort of understanding with that was that the old head of the CMA wasn't really on board with the sort of pro growth agenda of the new UK government that came in after the sort of conservatives roused it. So is similar to what happened with the ftc, right? A little bit, you know, obviously different mechanism but so my sense is like they'll kind of go along with this and so you'll essentially have the cookie be deprecated in Chrome and that opens the door to just, to maybe implementing a similar mechanic in Android and saying well look, we'll just let everybody consent. But it's, that's, that's the thing when you make someone seek out the setting, the opt out rates are low. Right. That was lat. But when you present them with the choice and you don't frame the choice as having, you know, a benefit to them one way or the other, it's all downside. If you opt in then you can put your thumb on the scale to drive the outcome that you want and you'll have very high opt out rates. Right. And I think that's what probably what Google will do. So they do that in Chrome, they do that in Android and they haven't, they haven't announced any change in the Android policy yet but I think that's what they're going to do then you essentially have the, the deprecation of those identifiers.

Alan Chappelle (17:06)

My favorite super isms was Apple has robbed the, the mob's bank. Absolutely love that. And so building on that, as I think of Apple I've always kind of compared them as the Teflon don of the tech giants. And that the John Gotti reference where like Gotti it's always been really hard to kind of nail them on anything because they make great products, they're super secretive, people love them and they claim to be huge on privacy. Now some of that's being shown as cynical. I mean the whole getting $20 billion a year from Google will do that for you. But I'm curious, like, as somebody who's really got their, you know, their, their figure on the pulse of both, you know, the press and where the winds are blowing, do you think that that Teflon Don status is starting to, I don't know, starting to shrink, starting to fade for Apple? I mean, because it, I felt like five years ago we would almost never hear of anything really bad that Apple was doing. And now it seems like, you know, like once a month there's something coming up.

Eric Suefert (18:09)

There's a couple of things here, right? So like when, when AT was first announced, I mean, I was sort of like very vocally hostile to it, right? And I was trying to just make the case, right, make the case. Like, look, okay, you can think however you want about ads, but you know, this is not being done for the benefit of the consumer. This is being done for the benefit of Apple. It's giving them more control of the platform. It's opening the door for them to expand the scope of their ad, their ad business, which they do have like, they have a fairly large ad business. It's being done to sort of like stymie the, their competitors, which, which were becoming more relevant as competitors in other market segments. Right? So Facebook, right, is building its own, its own. The Reality Labs division, which was essentially trying to become a bonafide platform, Right? Which, which posed a competitive threat to Apple. Right. And so for those reasons I argued ATT was, was born, right? Not, not. Not for. Not, not for this sort of like optically presented reason which was, well, we want to protect consumer privacy. Now Apple does have a long history of implementing things that do protect consumer privacy. So, so it's a little bit difficult of an argument to make it. Here are all these things. ITP and Safari, they've done these things to protect consumers privacy. And those things don't benefit Apple in any way. But that's Safari, right? That's just a tool that is available to people to browse websites. And so like. Well, yeah, Apple could just sort of like implement these privacy changes just for free, just for the good of the users. They could do that on iOS. It's different. IOS was changing. The mobile ecosystem was changing, Right. They were losing a lot of control of iOS, right. And it made a lot of competitive sense for them to sort of center themselves as the only point of distribution. Right? And the sort of like the ultimate curators of content to determine what became popular on the App Store. Because remember, they didn't make any money from all the ads that were being sold in apps in iOS, but they made all the money through IAPs. They made 30% on, you know, in game IAPs. Now that that amount has changed since then, but nonetheless they wanted, they wanted that control, right? And the other thing here is like if you get to a point where content becomes ubiquitous across platforms, then the power of your phone becomes much less important, right? Like in terms of like just the hardware power, but also like the central position it plays in your, in your technological life, right? And I think they wanted to avoid that happening. So if their ecosystem became unique in terms of like the products that were available, that has a huge amount of benefit for them in terms of just selling iPhones and driving services revenue. If everything was everywhere, then the iPhone isn't that important. The iPhone could be just a dumb gateway to all this, all these cloud services. And they want to print that, right? And that was the real point. And then also to grow the ad revenue of their own ad platform, which they have done. And so, so that was kind of my point. But like Apple has done a masterful job of presenting all of this to consumers as like one unified privacy effort. Everything we're doing in Safari is equivalent to everything we're doing on iOS and it's all just under the umbrella of Apple. That's privacy. IPhone, that's privacy. Safari, that's privacy, right? And they've spent a lot of money on a worldwide ad campaign to push that narrative, right? Now Google can't claim any of that. They just can't. The Google's like sort of don't be evil mantra, I think disintegrated 14 years ago, right? And so they just don't have the benefit of the doubt like Apple does. And so that was kind of my point. Apple has this sort of outward visage, right? They've got this facade that they can hide behind and they can utilize to implement these sort of like anti competitive strategies, right? And then point to the stuff that actually they couldn't benefit from, but it was only, only a function of their benevolence, right? Only a function of their beneficence to users. And like, but, but you could, you could parse those two things apart, right? And that's a hard argument to make, right? That's a very difficult argument to make. And I got attacked a lot, right, for trying to make that argument because people are saying like, oh, you know, you just don't care about privacy. Well, okay, fine, but now it's the German cartel Office that agrees with me. It's the UK CMA that agrees with me. Right. And so there are now I think like with the benefit of time and you know, because this is like a very complex issue, more people just had the time to study it and they came to a similar conclusion which is like, wait a second, the DOJ said Apple uses privacy as an elastic shield to camouflage its anti competitive efforts. It's not just, you know, the advertising.

Alan Chappelle (22:29)

People anymore, I would agree, and now. But the next step is, and as you think about how the marketplace is going to shift, you know, is there ultimately a negative outcome for Apple as a result of this shift in kind of perception?

Eric Suefert (22:43)

Well, so I don't think it's consumer shift but the problem is, you know, you've got Mark Muddle in the FTC now, you know, was Mike Lee's guy. Right. And Mike Lee was the most rabid anti, anti big tech person on these comp, on these competition grounds and he gets att, he knows what it is. Right. And so that's an issue for Apple. I think the biggest issue for Apple though is the search ref share. Right? That's privacy washing. That's privacy washing. It's like no, no, no, we hate all this data collection stuff but we'll take your check and we know where the money's coming from. Right? It'd be, you know, like that's, that's just absolutely, that's like it's the canonical example of privacy washing. We know where that money's coming from. We claim to hate that practice.

Alan Chappelle (23:20)

What's worse is you know where the money's coming from. But you are okay sending your users to this company that is horrible for privacy. By the way, Mozilla has the same issue.

Eric Suefert (23:30)

Yes, that's an issue. Right. It's privacy. That's, that's probably a greater degree of privacy washing because it's a much more important part of the revenues. But that 20 billion, that 20 billion is not rounding error for Apple either.

Alan Chappelle (23:41)

Sure isn't.

Eric Suefert (23:42)

I mean that's, you know, look at their services revenue. That's a, that's a substantial shock. I mean that's, that's, that's, that's capturing the services revenue.

Alan Chappelle (23:48)

Yeah, no, I would agree just to maybe put a bow at this. So as you think about how competition regulators are trying to rein in the big tech companies and like heck you've got at least five different entities and then including the EU commission under the DMA over there trying to rein in big tech and to date it hasn't been super successful. And the reason it hasn't been super successful in my view is number one, I mean, big tech is just so well funded and they can just continue to delay, delay, delay, half comply, half comply. And the other thing is that they can innovate and move very quickly relative to like this competition markets authority who just moves at a slower pace. I mean, is there, I guess, what's your prediction? Is there ever going to be a resolution to this stuff or is it really going to ultimately be the marketplace that regulates all of this stuff? For example, like, you know, AI search is going to be a different thing, probably controlled by a number of entities rather than just Google.

Eric Suefert (24:52)

No, I think just in Europe you want AI search, right. So I think the issue is we're facing like a sort of like expansion of digital deglobalization. Like I've written about this a lot, but we're going to have a different, we're going to have an EU Internet. We've got kind of like an Indian Internet, we've got obviously got the Chinese Internet, Russian Internet and we'll have like the North American Internet or you know, US Internet. And I think the issue with the, with, with the, the eu, yeah, these companies have a lot of money. And I mean, look, the, the lead up to the DMA and the dsa, the sister legislations, it was like a feeding frenzy for lobbyists, right? I mean they, the big tech companies deployed a lot of money to sort of push back against, you know, those, those bills. And, and they did, you know, they did manage to, to sort of soften a lot of the restrictions in them, which, because the DMA originally was supposed to include just like a blanket prohibition on targeted ads and that got softened down.

Alan Chappelle (25:45)

That's their lead on everything, by the way. The world will be a better place if we don't have targeted ads. And like that's like, I think that's in the preamble to the EU constitution. I'm not positive.

Eric Suefert (25:54)

Well, essentially targeted ads are more or less outlawed now in the eu. I mean, it's not an exaggeration. I mean, if you look at, it's.

Alan Chappelle (26:01)

Funny you say that and that's sort of related to this whole discussion. Like I've been following this now for 25 years and every so often some rando entity within the EU comes out with a proclamation that targeted ads are illegal and then they go away and we never hear from them again. And then somebody else comes three, three or four years later and sort of makes the same, the Same proclamation. And I, I just wonder if that's sort of what's going on here. I mean, should we be taking the, the whole German cartel more seriously? Because it's. Well, because it's Germany and there tend to be much more serious people or like. Or is this just going to just continue to spin on forever?

Eric Suefert (26:35)

No, no, because it's, that's outlawed, right? I mean, so that, that entity, that, in that, in that. Just to sort of, you know, borrow your example as a framework, that entity was a Norwegian dpa. They banned personalized advertising in Norway and they are part of the EDP board, right? And then they went to the EDP and they sort of said, hey, look, we're petitioning to have this ban that we've implemented in Norway, which they're not INAU member state, but they're part of the EDP applied across the eu. And the EDP said, okay, that's the difference. I mean, that's why this time is different. The EDPB was created to enforce the gpr. Well, the EDP said, yeah, you're right, we should do that. And it's for Meta. For meta. I mean, that was applied specifically to meta. Right. So meta, you can't do personalized advertising. Meta, can't do that anymore. And that's why they came up with the pay okay regime. Right? And so the pay okay was, hey, look, look at all these German newspapers. They say if you don't want to consent to cookies, then you got to pay. And it's either one, it's one or the other. And so that's what Meta implemented. And the edpb, they had a problem with that. But also the EU had, the EC had a problem with that under the sort of protections of the dma. The EC sort of like objected first and said, look, this is a violation of the dma and guess what? And so this is how you police it now, the DMA and the GDPR and the EDPB, the manifestation of the EDPB's power, which really happened in the last couple years, and then now the dma, those are the. What's different now? Because you know what, the penalty is for non compliance, the max penalty is for non compliance with the dma. What is it?

Alan Chappelle (27:59)

Oh, I think it's a zillion dollars a day. I'm not positive, but I think the fine structure is just, is just all over the place.

Eric Suefert (28:05)

10% of worldwide turnover. Yeah, that's why this time is different. And it goes up to 20% in cases of repeat offense. Right now what's the maximum sanction under German law for violation of the antitrust ruling by the cartel office? It's 10% of worldwide turnover. So that's why this time is different. And so what I think is going to happen is not so much that will competition will flourish and you know, a viable competitor to Google emerges in the EU or Facebook. I think it's just that these companies pare back their services to sort of like the most basic inoffensive, you know, versions for EU use. And what you get is no sort of like cutting edge AI, right? You get like the kind of, the sort of like under monetized, less personalized ads, which is what Facebook ended up rolling out for users that don't consent or pay because they had to introduce a third option because the EPB and the EC objected to pay. Okay. And so you get just kind of like a much worse Internet. And what the sort of like activists will say is like, well that's great because nothing matters more than my perceived perception I have that my privacy is being protected. And you don't have to quantify that in any way. I just have that perception. It's an emotional vibe. And nothing is more important than my emotional vibe that my privacy is being protected how I the activists define it. And I think that's what you'll get.

Alan Chappelle (29:29)

So a couple of things to react to there. So firstly, the EDPB is supposed to be an advisory board, unfortunately, or for better or worse, it is treated, their opinions are treated by various individual data protection authorities over there as being gospel. And so that right there is a little bit of offers a little bit of a disconnect. And then with respect to AI, boy, I'll tell you, the process which is horribly broken as it pertains to targeted ads is just going to be blown to smithereens when it comes to generative AI. There's just absolutely no way that you can do it under the current rule set. And by the way, I'm not here to say that generative AI is a good or a bad. There's a whole bunch of issues, not the least of which is intellectual property protection that just aren't being addressed. And that's a huge societal problem. But, but nonetheless there is not a single regulator in the world right now whose, you know, fair information practice principle framework is geared to address generative AI. And it's just going to be a huge set of problems over the next couple of years.

Eric Suefert (30:30)

Well yeah, from an IP perspective, sure. I mean, and now I'll you know, leave that to people that are less smarter than me to figure out. I wouldn't want to have to deal with that. But from the advertising perspective, you know, there's just the opportunity here is just enormous, right? I mean this is just like a transformative moment. Here's the problem, like one thing that Apple's done a really good job of is convincing people that personalized advertising is evil, right? And like they've invoked this kind of like just emotional language to make, you know, privacy, that's iPhone. And they had the commercial of the guy literally being followed throughout like a shopping mall. And like that. Well, that's the comparison they made to personalized advertising. Someone's following you and they're stalking you and they're observing everything you do. And so they've done a really good job of like inculcating that sort of interpretation with consumers, right? And so you could say, well, these benefits for advertising, well, they're going to accrue to these creepy companies, these evil companies. This is emotional vernacular that's being used. But the reality is the whole modern economy is tethered to the digital advertising and it drives an enormous part of American prosperity. And so to starve yourself of that or to sort of cut off access to that, but there's not an honest portrayal of the way this information, this technology is being used to their benefit. And that's, that's I think the real problem. And that's a narrative problem right now that's also a tech problem. You talked about Mozilla, right? So they acquired a portfolio company of mine called Anonym, right? Like really cutting edge privacy preserving technology. And the problem is like you have voices within the space, within the activist space that says there's no such thing as privacy preserving technology. The only solution is to starve these companies of data. The only solution is to prevent this data from being disseminated in the first place. Because there's no way, there's no possible way that to preserve privacy through technology. And I just fundamentally disagree with that and I think it's demonstrably untrue.

Alan Chappelle (32:17)

So I actually want to end with that question. You've sort of partially answered it here. Like is all of that privacy protective stuff the idea that you maybe move away from individualized user targeting and towards a cohort model, maybe you used, you know, homomorphic encryption or you use different privacy enhancing technologies. Leaving aside the crazier of the advocates, because right now we're never going to satisfy them. But for the big middle is that where do you Think this is all going to end up in a couple of years where, where the only thing available is sort of the, you know, something that's synthesized through pets that just don't allow individual identification.

Eric Suefert (32:50)

I mean, I hope so, because, I mean, I do think, you know, preserving people's privacy is important. I think it's important for people to believe that, you know, they're not being. Their personal data is not being leaked. It's not being utilized in ways that they can't foresee. Don't get me wrong. I mean, there are serious, acute risks to, to having your data being collected aggregated and sort of like processed.

Alan Chappelle (33:10)

Precise location and health.

Eric Suefert (33:11)

Precisely. And. But I've always said there's no reason to collect geolocation data in the bid request. No reason whatsoever. It's all snake oil that's being sold that we can target people that visited these shops. It doesn't work. I listen to your podcast episode Duncan McCall, but he kept bringing up big box retail and shopping malls. Yes, that's where it works because, fine, it's a big physical area, but you can't, you know, look, I live in Boston. I go to Duncan. Or I could be next door at the deli. There's no way for my phone, even with geolocation turned on, to discern between those two. And when you, when you obfuscate even further out, like what with the accusations made against gravy analytics, all that stuff. The biggest problem with that is they were portraying the IP data as geolocation data. They're selling it like it wasn't. It was IP address data that's not precise enough to be used for targeting. So basically they were, they were presenting their data as being useful for geotargeting, but it wasn't. That's the real issue. Take that out. You don't need to be able to target that way. And that, yes, that can be used to identify a person's home. And then, you know, and then you look at where else they've been and you can sort of trace their entire sort of like physical journey throughout the day. I think that is an absolute privacy violation. It should be possible. I think data brokers should be regulated much more harshly if they should even exist at all. So, like, I, you know, I take a firm stance on a lot of this stuff, but there's a limit in the wrong direction of saying, like, well, see, look, that could happen. Or, well, let's police that behavior. Let's not just say there should be no data collected. Advertising doesn't need to be targeted at all. Because the argument people go to is like, well, advertising existed before digital advertising. Yeah. It existed at a much lower sort of. I know, I'm kind of rambling.

Alan Chappelle (34:39)

Back then, the cartel was the newspaper industry, and we've just shifted from one cartel to another. Yes, but it wasn't necessarily better back then.

Eric Suefert (34:47)

No. And how many people were advertising. How many people were advertising on TV and how many advertisers are advertising on social media? Right. So you've expanded the economy. Now the problem is people point to advertising, advertising a percentage of gdp and say, well, it's pretty. It's pretty flat.

Alan Chappelle (34:59)

Yeah.

Eric Suefert (34:59)

Because advertising is driving gdp, advertising driving GDP growth. So it's flat because it's growing the GDP Right now the point is like, this is an innovation that led to economic growth. Let's not throw the baby out with the bathwater. Let's police the practices that we see to be to present real risk and then let's minimize the risk. Right. In places where it's possible but not necessarily acute. Right. And so like that is using pets, I think you can do on device processing. Right. You can apply differential privacy, you can do federated learning, you can do homomorphic encryption. There's a lot of ways that cutting edge tech can be applied to this problem to reduce risks to a level that are acceptable. And then you just let people decide. Right now the. Another issue here is people say no one could possibly consent because they can't understand that. I don't believe that. I think. I think that's condescending. I think people can understand right now. Can people process 18 different consent prompts throughout the day? I. I don't know. Maybe not. But I do think people can make that choice for themselves. And I don't think activists should be able to preclude the possibility of personalized advertising because there are risks that are possible. That just seems like it's economically dangerous.

Alan Chappelle (36:03)

I would agree. And let's leave it there. Let's leave it with us. Agreeing. Thanks so much for coming on, Eric. This was a great conversation.

Eric Suefert (36:10)

Yeah, cheers, Alan. Always good to see you, man.

Alan Chappelle (36:11)

You too. That was a great conversation. We've got a bunch of other fantastic guests coming up on the Monopoly Report podcast over the next few weeks. Please subscribe to the show atmonopoly Report pod.com or on Spotify, Apple, YouTube, or wherever you listen to your podcasts. Thank you so much for listening. Thank you for listening to the marketecture podcast. New episodes come out every Friday and an insightful vendor interview is published. Each Monday, you can subscribe to our library of hundreds of executive interviews at marketecture tv. You can also sign up for free for our weekly newsletter with my original strategic insights on the week's news at News Market tv. And if you're feeling social, we operate.

Eric Suefert (36:57)

A vibrant Slack community that you can.

Alan Chappelle (36:59)

Apply to join at adtechgod.

Eric Suefert (37:02)

Com.