Google’s ad-tracking program Privacy Sandbox has overcome a key regulatory hurdle

Substantial progress has been made recently in Google’s plan to phase out third-party cookies and enable a “Privacy Sandbox” replacement, overcoming a key regulatory hurdle. Britain’s competition watchdog, the Competition and Markets Authority (CMA), announced today that it has formally accepted Google’s commitment how to set new standards so they don’t harm competition or unfairly continue to push advertising.

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Google’s plans are still incomplete, and it’s unclear what technology “Privacy Sandbox” will use to replace third-party cookies. Just last month, Google abandoned the “FLoC” approach in favor of a new system called the “Topics API.” Today’s approval is for Google’s approach, not anyone-specific technology. The regulator noted that in the next phase, it will “oversee Google to ensure that Privacy Sandbox is developed in a way that benefits consumers.

Now that it’s officially accepted, Google’s commitments are legally binding, and the search giant has said it will apply them globally. These commitments include transparently developing Privacy Sandbox recommendations and publishing test results. Google has also said it won’t delete third-party cookies until the CMA believes the new alternative won’t raise competition concerns, and Google has also said it won’t unfairly share data within its business to gain an advantage over competitors.

Andrea Coscelli, chief executive of the CMA, said in a statement: “The commitment we have received from Google will foster competition, help protect online publishers’ ability to raise money through advertising, and safeguard user privacy. While this is important, we’re not under the illusion that our work is done. We’ll keep an eye on these recommendations as Google continues to develop them.”

The proposals have been controversial, with critics claiming they could cement Google’s dominance in the digital advertising market and make it harder for online publishers and other advertising companies to make money. Therefore, in early 2021, the CMA said it would formally investigate these proposals and later began working directly with Google to design and develop them in a manner that does not harm competition.

The collaboration resulted in a series of commitments from Google, which the CMA tentatively approved at the end of November. Google will appoint a CMA-approved oversight trustee who has access to Google’s systems to verify that it is not unfairly harming competitors. The Financial Times previously noted that last June, Google said it would not use first-party data collected from Chrome or Android to track users across the web after third-party cookies were phased out.

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