Britain’s competition watchdog has agreed to Google’s proposed changes to the way it uses customer data.
The Competition and Markets Authority (CMA) said the search engine had now signed legally binding rules designed to prevent Google from further extending its dominance in the online advertising market.
Regulators will have a watchdog position to ensure Google’s “Privacy Sandbox” plan avoids squeezing competition when clearing third-party cookies on its Chrome browser.
The commitments, which span six years, include the CMA and the Information Commissioner’s Office (ICO) collaborating with Google in the development and testing of new Sandbox proposals.
Regulators said they wanted to make sure the changes protect consumers from both competition and privacy and won’t be implemented until a series of testing phases.
Google has already delayed rolling out plans until 2023 and aims to introduce the new proposals globally if they are successfully implemented in the UK.
In a statement, Google said, “We are pleased that today the CMA accepted these commitments, which are now effective immediately. We will apply the Commitments globally as we believe they provide a roadmap for how to address both privacy and competition issues in this evolving industry.
Earlier, the CMA warned that the changes could strengthen Google’s dominance in online advertising, with third parties no longer able to track users and gain insight into their online browsing interests.
He also warned that the changes could undermine the ability of online publishers to generate revenue and continue to produce valuable content in the future, reducing the public’s choice of news sources.
Google has pledged to be more transparent than the initial proposals presented, including publishing test results, with the CMA allowed to intervene if necessary.
Third-party cookies, used by advertisers to track customer usage and interests, will not be removed until the AMC is satisfied that its competition concerns have been resolved. The CMA added that it had the right to reopen its investigation, first launched in January 2021, if necessary.
Google will limit data sharing within its own organization to ensure it does not gain an advantage over competitors when third-party cookies are removed.
The company will also undertake not to grant preference in its advertising services, while a monitoring agent will be appointed to work alongside the CMA.
Andrea Coscelli, Chief Executive of CMA, said: “While this is an important milestone, we are under no illusions that our job is done. We are now entering a new phase where we will be keeping a close eye on Google as it continues to develop these proposals.
“We will engage with all market participants in this process, to ensure that Google takes into account the concerns and suggestions raised.”
Stephen Bonner, ICO’s Executive Director for Regulatory Future and Innovation, said: “Consumers benefit when organizations recognize that data protection, privacy and competitive objectives must be considered together, and commitments require Google to do so.
“We will continue to work with both organizations to ensure that Google Privacy Sandbox proposals comply with data protection law and deliver strong privacy outcomes for individuals.”
Google’s Privacy Sandbox plan continues to raise questions for privacy advocates and advertisers. The company recently announced that it is removing the “Federated Learning Cohorts (FLoC)” aspect of its original plans for third-party cookies in Chrome, started in 2020, and will now replace it with a new system called “Subjects”.
Topics will assign five broad categories to a user, based on their recent activity, which will expire after three weeks and be replaced by new topics.
The move was cautiously greeted by industry commentators as an improvement over existing third-party cookies and the now-obsolete “FLOC” concept. However, it has also been noted that Google is already well behind browser rivals, such as Apple’s Safari and Mozilla’s Firefox, in effectively limiting third-party tracking cookies.
Chrome also takes the lion’s share of the global browser market – at around 63% – giving Google a big influence on future standards, due to its size. Advertisers are also unconvinced of the company’s plans, despite Google itself grossing $53 billion from advertising in the third quarter of 2021 alone.
Sign up for the E&T News email to get great stories like this delivered to your inbox every day.
