This browser is not actively supported anymore. For the best passle experience, we strongly recommend you upgrade your browser.
viewpoints
Welcome to Reed Smith's viewpoints — timely commentary from our lawyers on topics relevant to your business and wider industry. Browse to see the latest news and subscribe to receive updates on topics that matter to you, directly to your mailbox.
| 1 minute read

US Digital Advertising Act - A Monumental Shift in 2023?

The US senate’s proposed Digital Advertising Act seeks to break up big tech from playing multiple roles on both the buy and sell side of the digital advertising chain and require various transparency disclosures that would represent a monumental shift in the media buying landscape if enacted. The proposed legislation has support from both sides of the house, which certainly gives it more gravitas and credibility and it seems to be progressing through the legislative tunnel at normal speed. Nothing is a slam dunk these days, but it is within the realm of reason that the law will proceed and be passed in the second quarter of this year. If so, the big questions will be “what does it look like then?” and “will the enforcement agencies have the resources to manage and effectively police the legislation (and deal with any judicial challenges to it)?” Will this be as seismic as the FTC’s new Section 5 policy statement or a damp squib, a footnote operating at the margins of the digital advertising economy? Watch this space.

Some of the key provisions of the draft legislation are as follows:

  • No business with over $20 billion in digital ad revenue can own a digital ad exchange if that business already owns a DSP or an SSP or if it also monetizes off of digital ad space.
  • No business can hold both a DSP and an SSP.
  • Any company that makes over $5 billion in revenue must act in its customers’ best interest and be ready to take on new transparency requirements.
  • The bill requires ad tech companies to anonymize consumer info and states that pubs and advertisers may only use the data if they need to verify the company’s legal compliance.
  • Any ad tech company covered by the law must inform customers of “the source and nature of any compensation paid or received in connection with transactions.”

Tags

entertainment & media, advertising

Latest Insights

post featured image