Only five months away, GDPR could change the course of advertising forever. Currently slated for 2019, the ePrivacy Directive is driving even greater concern in all corners of the industry. Are we ready, and should we really be fearful of its impending introduction, or does it present myriad opportunities? In a series of features, reflecting on the past year and looking ahead to what we can expect in 2018, ExchangeWire invites over 100 thought leaders from across the industry to share their views. In the latest installment of the series, experts share their thoughts on the impact of GDPR on the future of digital advertising.

The uncertainty will drive an investment and M&A slowdown

"I predict that, after a last-minute push from privacy activists, the ePrivacy regulation will come into effect in 2018. It won’t be enforced in its current state; but it will still heavily limit the use of online identifiers by advertising technology companies without prior consumer consent. Ultimately, the big winners of the above will be Google, Amazon, Facebook and, to certain extent, large publishers and publishing groups that have large audiences. I also think that investments and M&A activity will slow down significantly until the uncertainty of what is and isn’t allowed is clarified. On the other hand, this uncertainty will also cause valuations to drop and create occasions on the market to buy the companies that are desperate for cash cheaply. Lastly, I believe the concept of 'privacy by default' introduced by the GDPR will gain traction in 2018 as Microsoft and Mozilla will likely follow Apple and roll out mechanisms similar to Intelligent Tracking Prevention in their browsers, making third-party cookies irrelevant."

Maciej Zawadziński, CEO, Clearcode

An identity resolution quagmire

"How do I know you are you online? GDPR and the ID consortiums will collide into an identity resolution quagmire next year. Forget about audience targeting; frequency capping doesn't work without persistent IDs! How we adapt to the changing regulatory landscape and implement solutions like DigiTrust, Open Ad ID, or market-specific services like the Log-In Alliance in Germany will be a hot area to keep our eyes on."

Alex Merwin, VP International, SpotX

The US also needs to consider GDPR

"GDPR is a major push in the EU created to preserve individual rights regarding identity and tracking. It will have widespread worldwide influence on companies targeting services at a European audience where personal data is collected. As a guaranteed forward contract trading platform, NYIAX will keep a close eye on GDPR and intends to be ready and able to support GDPR. One of the main aspects of GDPR requires users to give explicit consent for use of their personal data, and for a specific purpose. As such, individually targeted advertising will be severely impacted in the EU. In the US, where roughly 37% of global ad dollars are spent (eMarketer ’17 prediction), GDPR legislation is not currently in the works. However, there is a large volume of global publishers and advertisers with users in both the US and the EU. The distinct possibility exists that EU legislation will provide the impetus for publishers and advertisers to adopt a global standard to simplify their GDPR compliance. However, with so much ad spending being done in the US, there is a greater potential for this market to comply with GDPR only as necessary and continue targeting US users as before. In both cases, the ability to audit the complete history of the campaign purchasing and delivery will be necessary as compliance failure will carry heavy penalties (possibly as high as 5% of global spend for each violation). Having transparency into where a campaign ran, if personal data was collected, and user location data will be very important. NYIAX believes the combination of blockchain attributes in a GDPR-world will fit well regarding data record keeping. NYIAX has kept interoperable and interchangeable blockchains at the forefront of product development and believes the powerful combination of NYIAX with the Nasdaq Financial Framework will enable support of any GDPR blockchain solutions that arise."

Ben Feldman, VP of Technical Operations, NYIAX

More cooperation throughout the supply chain

"GDPR might have the unintended effect of forcing more cooperation between vendors throughout the ad tech stack. One of the more problematic requirements of GDPR is that you need to keep a paper trail for your data, and you have to be able to export it or delete it at any web user’s request. So if some reader on a news site asks the publisher for the data, everyone including the ad exchange, the ad server, the data-management platform, and even the third-party measurement company, might end up having to fulfil the reader’s request. If the ICO decides to be strict on this issue, each company in the chain will need to be able to tell the next company in the chain exactly what data is relevant. That sounds a lot like classic data integration between vendors."

Andrew Gu, VP of Product, Thunder

The ad industry could enter a period of 'data austerity'

"With the GDPR deadline rapidly approaching, achieving compliance with new data laws should be at the top of all marketers’ New Year resolution lists. As awareness grows ahead of May 2018, many have still yet to prepare; a survey of European marketers earlier this year found that 51% were not ready for the changes. What is certain is that most of the advertising technology industry, and many brands, will not be ready in time. But prediction is about making sense of maximum uncertainty, confusion, and ignorance about what is coming next – the immovable GDPR and the unstoppable ePrivacy regulation hit the market. For instance, there is a high likelihood we will see the end of the DMP and data on borders as we know it in Europe, leaving the ad industry in a state of ‘data austerity’. The industry has spent too long ignoring the essential questions of data protection, but, 2018 will be exciting for those businesses that realise that the only real way forward is innovation – fresh thinking, new collaborations, and fit-for-purpose technology."

Tobin Ireland, CEO & Co-founder, Smartpipe

Net neutrality could be under serious threat

"GDPR is now fast approaching as the industry is still wrapping its head around the legislation, which has a global reach. By the end of 2018, there are sure to be some heavy fines placed, which will set the scene from which others can learn. Net Neutrality is under serious threat by the FTC’s plans to reclassify ISPs from a utility – where internet providers are required to provide open access to their networks for all digital content – to information providers, allowing them to potentially throttle distribution of some content types and charge for better access. Depending on what happens on 14 December, this could affect the whole internet in 2018."

Andy Evans, CMO, Sovrn