News Sites: Readers need to "buy back" their own data at an exorbitant price?!

Aug 13, 2021

News Sites: Readers need to "buy back" their own data at an exorbitant price

Today, noyb filed complaints against the cookie paywalls of seven major German and Austrian news websites: SPIEGEL.de, Zeit.de, heise.de, FAZ.net, derStandard.at, krone.at and t-online.de. An increasing amount of websites asks their users to either agree to data being passed on to hundreds of tracking companies (which generates a few cents of revenue for the website) or take out a subscription (for up to € 80 per year). Can consent be considered “freely given” if the alternative is to pay 10, 20 or 100 times the market price of your data to keep it to yourself?

Personalized advertisement necessary for survival? Media outlets are financed by advertisements, subscriptions, subsidies or donations. Online, too, a large part of advertising is not personalized, just like with ads in print media, radio or television. While media companies make good money with directly booked and mostly non-personalized advertising, the "leftover space" on websites is sold off to Ad-Tech companies for a few cents. Valuable user data is then sent to these competitors, which thereby take the lion’s share for themselves.

Profit and data remain with Google & Co. According to a U.S study, media outlets only get about 4% of the additional revenue from passing on data. In the Netherlands, public broadcasters make more money online with non-personalized advertising than by passing on data to tracking companies.

Alan Dahi, data protection lawyer at noyb.eu: "Many media companies have become slaves to large corporations. They sell off their readers' data and trust for a few cents. The big profits go to the tech giants in the Ad-Tech industry - just like the data."

Readers to "buy back" data at an exorbitant price? Only about 3% of all users want to agree to the processing of their data. Starting with derStandard.at in Austria, an increasing number of media outlets have implemented a "pay or okay" solution. Users have no free choice whether they want to consent (as provided for in the GDPR), but have to take out a subscription if they do not want to give their consent.

Saying "no" to tracking is not only time-consuming (you have to enter your name, address and credit card data), but users also have to dig deep into their pockets: while the media companies only get a few cents per user for passing on data, SPIEGEL and FAZ currently charge € 59.88 per year for a tracking-free subscription. Die ZEIT charges € 62.40 and derStandard.at even € 84 per year for its "PUR subscription" without any form of advertising. As soon as these figures are compared to the total revenues of media companies, the extent of the profiteering is obvious: If all readers of spiegel.de took out a "PUR subscription," the company would generate a revenue of around €1.2 billion. Right now, their current digital revenue is around €76.9 million. In other words, the costs for these subscriptions go far beyond making up for lost ad revenue when users do not agree to tracking.

Alan Dahi, data protection lawyer at noyb.eu: "People would sometimes have to pay ten, twenty or one hundred times as much to stop their data being shared. You get the impression that this is not about a fair alternative to consent, but about selling expensive subscriptions."

The spread of this "solution" may also be based on a 2019 ruling by the Austrian Data Protection Authority, which found that there is no violation of the GDPR in a "pay or okay" system. However, this case was brought by a lay litigant and suffered from largely inaccurate factual information before the authority. noyb is determined to reverse this ruling.

Privacy a matter of income? Most users visit dozens of news sites per month. If they do not want their data to be shared by the websites it soon becomes a costly affair. Legally, there is also no special status for private quality media - any website, no matter if it provides recipes or world news, could force users to consent with a "pay or okay" approach and thereby circumvent the GDPR.

Alan Dahi, data protection lawyer at noyb.eu: "Most people visit many different websites a month. If every site charges 5 Euros, you quite quickly have to be a top earner to be able to afford data protection. This no longer has anything to do with freely given consent."

Privacy-compliant advertising as a solution. Newspapers and magazines are looking for avenues to survive in a digital world where “online” often equals “for free”. noyb is aware of this problem and our daily contact to journalists shows how the situation is becoming increasingly precarious for quality media. However, narrow profits at the expense of their readers’ fundamental right to data protection will not be the solution for all financing problems.

Alan Dahi, data protection lawyer at noyb.eu: "We need properly funded media. However, it is a fallacy to believe that transferring user data to Google and others will solve this structural issue. Innovative advertising systems that media companies operate themselves and where both data and profits remain with the quality media are not only legally required, but probably also a question of economic survival. At present, the former flagships of the free press have become nothing more than advertising pillars and data collectors for Google, Facebook and other tech giants. We need to get back to a system where the reader follows the advertising instead of where advertising follows the reader."