EU Green Lights Telecoms Advertising Joint Venture

Dan Meier 13 February, 2023 

The new ad tech joint venture (JV) between Deutsche Telekom, Orange, Telefónica and Vodafone has received regulatory approval from the European Commission, setting the stage for the use of telco data in digital advertising.

The European telcos will each take a 25 percent stake in the holding company, to be based in Belgium and run by independent management. A shareholder-appointed supervisory board will oversee the running of the group.

Following the filing of the proposal in January, the Commission has concluded that the transaction would raise no competition concerns in the European Economic Area, and cleared the case without conditions.

It added that the JV will offer “a platform to support brands and publishers’ digital marketing and advertising activities in France, Germany, Italy, Spain and the UK.”

The JV will outline its vision and strategy “in due course”, according to the firms, including its plans for widespread adoption of the technology currently undergoing trials. So far the tech has been trialled in Germany, with roll-outs planned for France and Spain to further develop the platform, in order to make it available to any operator in Europe.

“Privacy by design”

Where previous attempts at far-reaching ad tech tie ups have come unstuck under the regulatory microscope – and US tech giants face ongoing scrutiny over their methods of gaining consent for using personal data – the European JV has GDPR baked into its DNA.

The “privacy-by-design” platform requires opt-in consent by the consumer to activate brand advertising, according to the companies. They said the platform offers consumers control, transparency and protection of their data, which is currently collected by “major, non-European players.”

The only data shared is “a secure, pseudonymised token” that cannot be reverse-engineered, and is linked to a user’s network subscription, provided by participating network operators. This ID will be available to publishers and brands – enabling frequency capping and retargeting – without revealing any personally identifiable information.

The telcos will also host a user-facing portal where individuals can control which brands and publishers have access to this ID, enabling users to opt in or deny consent with a single click. Whether such a policy can avoid the low consent rates stemming from Apple’s ATT changes may cause advertisers some concern.

In any case, the JV has cleared its first major hurdle, absolving the initiative of any competition concerns. Data use could still pose a regulatory challenge however, with privacy watchdogs more focused on ad tech than ever.

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