The German Federal Ministry for Economic Affairs and Energy had mandated an economic impact of the ePrivacy Regulation on online advertising and ad-based digital business model. The study considered details on the impact the European Commission proposal would have on the internet business model and online advertising industry, concluding that considerable disadvantages for Europe’s digital innovations and economic development can be expected.
The economic impact, realised by the consultancy WIK on behalf of the German Federal Ministry for Economic Affairs and Energy, identifies the significant influence the proposal would have on the industry. The research confirms that the ePrivacy provisions requiring consent for cookies will have significant impacts on the digital advertising sector, followed by impacts on publisher’s revenue and the development of innovative services, based both on collection of data and advertising revenues. Among the insights of the study:
The study concludes that considerable disadvantages for Europe’s digital innovations and economic development can be expected. “In combination with the gatekeeper position of web browsers, it is likely that in the medium to long term, major online platforms such as Facebook and Google, which are heavily financed by advertising, will benefit in comparison with other market participants. The ePrivacy Regulation may therefore trigger the development of a largely proprietary internet, of which the advertising revenues are generated almost entirely outside of Europe”, states the research.
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