Third-party cookies have long been “the glue that holds together the independent ad tech world.” Far surpassing their original purpose of giving “memory” to websites, these cookies are heavily relied upon by marketers to analyze and track online users. Indeed, cookie-based targeted advertisements are the reason why websites can sustain their “free” business models. But what’s good for industry has not been good for user privacy—and the tide is starting to turn.
Part one of this two-part series addresses the current legal and regulatory developments impacting the use of third-party cookies in the European Union and United Kingdom. Part two will explore the industry shift away from third-party cookies and their alternatives.
EU legal developments
Negotiations are currently underway for the draft ePrivacy Regulation that will eventually replace the 2002 ePrivacy Directive and better harmonize data protection laws across EU member states. The EU General Data Protection Regulation already requires websites to obtain explicit consent before using cookies, but the ePrivacy Regulation—which was originally intended to be enacted alongside the GDPR back in 2018—could allow for new ways to streamline consent. For instance, the current draft from the EU Council makes cookie walls a possibility, and it would also allow users to whitelist cookie providers at the browser level to reduce the number of consent pop-ups.
Outstanding issues—such as cookie walls—are said to be prolonging an agreement on the Council’s long-awaited draft. Likewise, critics argue the draft “hugely misses the mark,” and Germany’s Federal Commissioner of Data Protection Ulrich Kelber urged the European Parliament and the Commission to “increase … the level of data protection” during negotiations. In short, the specifics of the ePrivacy Regulation remain unclear, but the end result will almost certainly have an impact on cookies—and consent requirements for them may be here to stay.
Moves in Parliament also hint at incorporating restrictions on certain targeted advertising in the incoming Digital Services Act. Christel Schaldemose, the MEP currently steering the DSA through Parliament, supports a ban on behavior-based targeted ads (as opposed to “classic commercial advertisements”). Germany wants users to have the option to visit certain websites without targeted ads. The European Data Protection Board states the DSA should “more strictly” regulate online targeted advertising and recommends “a phase-out leading to a prohibition of targeted advertising on the basis of pervasive tracking.” The Tracking-free Ads Coalition—a group of EU political leaders, organizations and businesses—has been campaigning to end “the pervasive tracking advertising industry that dominates the internet today.” According to Alexandra Geese, an MEP participating in the Coalition, three groups in Parliament (S&D, Greens and Left) currently support shifting the industry to contextual advertising.
At the same time, industry groups have been…
