The future of TV advertising – a lawyer’s perspective

Earlier this week I went to two sessions at the fantastic Future TV Advertising Forum. One session was about the “second screen” market and how the apps ecosystem in this area is taking shape. The other session was about TV VOD advertising, how to optimise advertising inventory, and the formats that work for TV VOD.

I noticed two recurrent themes from these sessions (i) data and (ii) targeting – in particular, the potential to behaviourally target dynamically inserted TV VOD ads. The ability to collect data from TV viewing and dynamically target advertising based on that behaviour would have been a dream to advertisers years ago but now IPTV platforms make this a possibility.

A particularly interesting legal/regulatory challenge in this area is how to assess the application of the cookie notification and consent rules (under the amended E-Privacy Directive) in the context TV VOD behavioural advertising.

In the UK, the rules are implemented by Regulation 6 of the Privacy and Electronic Communications (EC Directive) Regulations 2003. Regulation 6(1) state the following:

…a person shall not store or gain access to information stored, in the terminal equipment of a subscriber or user unless the requirements… are met.”

The first point to note is that there’s no reference to “cookies”. The relevant activity is “storing or gaining access to information stored”. This means the regulation covers any kind of customer-side storage and accessing of any information by a service provider. The second point to note is that there’s no reference to computers or even “devices”. All the regulation says is: “terminal equipment”. The rules therefore cover mobile phones, games consoles, tablets, and connected-TVs.

Whilst all the fuss about cookies has been focused on the web, it’s worth noting that collecting data from TV VOD viewing and using it to target ads would be captured by the regulation to the extent it involves setting, for example, a unique identifier on the TV and collecting data from it.

So what are the requirements? Regulation 6(2) says the following:

The requirements are that the.. user… (a) is provided with clear and comprehensive information about the purposes of the storage of, or access to, that information; and (b) has given his or her consent.

There have been seemingly endless debates about how to interpret the above regulation. Is it ok to simply display the “clear and comprehensive information” in a privacy/cookie policy linked to from the footer of the webpage? Do I need to implement a pop-up or a drop-down banner on my site? Is it ok to imply consent from the user’s continued use of the site? And so on.

These debates have virtually always been in the context of cookies set by websites. It will be interesting to see what happens when/if the regulators and legislators start to turn their eyes to the behavioural targeting of TV VOD ads which, although currently nascent, is a rapidly developing proposition.

TV is of course a fundamentally different user experience to using a computer (or a tablet). The screen is much further away, you use a remote control instead of a keyboard (or touchscreen), the ads take up the whole screen (as opposed to sitting inside a box on the side of the screen), and so on. All the debates about privacy policies, notices and consent may need to be recontextualised in accordance with this different user experience.

It is also worth considering the advertising industry’s self-regulatory solution involving an icon and opt-out mechanism for online behavioural advertising. Whilst this may have received criticism from the European data protection regulators, it has been specifically endorsed by the UK ASA through the addition of a new appendix in the CAP Code (with effect from February 2013). However, again this is a system designed for the online, as opposed to TV VOD, user experience. It will be interesting to see how this and/or other related solutions develop in the growing TV VOD advertising market.