In defence of regulation: why clearer rules & more effective enforcement are good for digital advertising

The myth of deregulation 

In the last few months, there has been much talk about Europe’s overregulation and its impact on Europe’s competitiveness in tech and AI. Although concerns are legitimate, the argument that regulation is inherently bad for business is not backed up by evidence. For instance, China has closed the technology gap with the US while passing (and ruthlessly enforcing) strict data protection and competition laws. Independent ad tech companies have been pushing for stronger enforcement of competition regulations to protect the market from aggressive moves by big tech and copyright laws are our best weapon against the indiscriminate theft of publisher content.

Instead of less regulation, the UK and Europe need clearer rules that are consistently enforced. This idea seems to resonate with the UK Government and especially with the Competition and Markets Authority (CMA), whose newly appointed chair highlighted how regulatory uncertainty hampers economic growth and how regulators should strive to create a stable, well-informed and predictable environment. Alas, we have an awfully long way to go. 

Bad regulation is bad for business 

Digital advertising is affected by a plethora of regulations that are sometimes disconnected and contradictory. In the last three years, the EU has passed four major regulations that impact digital advertising (DSA, DMA, Data Act and AI Act) while the UK has passed three (Online Safety Act, Children’s Code, DMCC Bill) and is developing two more (Online Regulation and DPDI Bill). Even mature regulations like GDPR and PECR are still misunderstood. To make things worse, Europe has a reputation for making ambitious laws that are chronically underenforced, creating uncertainty that increases business costs, distorts competition and hampers innovation. 

Take privacy. It took years for the courts to clarify how GDPR rules apply to digital advertising. Data protection authorities’ inaction created space for big tech to enact anti-competitive measures under the guise of protecting privacy until competition regulators had to intervene. The French Competition Authority has found Apple’s App Tracking Transparency unlawful but hasn’t yet requested any specific changes to the framework.

This ambiguity has had real economic consequences: publishers and advertisers have invested millions preparing for changes that never materialised, while new technologies were developed in anticipation of regulatory shifts that never happened. Meanwhile, the walled gardens have remained a safe haven, a rock of stability in a sea of uncertainty. Similar dynamics are now in play with the rise of AI, where open web content is illegally scraped and unfairly reused to direct traffic (and ad revenues) away from content creators while the law slowly catches up. 

Taking the helm 

As the era of regulatory overproduction comes to an end, businesses should not be hoping for hard and fast deregulation. Laws protect independent companies from monopolistic behaviours just as they protect society from corporate malpractice. The industry should be pushing for simpler and clearer rules that are backed by proportionate, rapid enforcement.  

Our industry must stop tolerating fraud, hiding and abetting illegality and whitewashing legitimate privacy concerns before the next scandal undermines its credibility and gives another opportunity to unscrupulous monopolists. Working with the regulators to put our house in order is not a burden: it’s an investment into the security, stability and defensibility of our industry. 

Mattia Fosci is CEO at Anonymised. For more information visit: anonymised.io