Digital Advertising Industry Faces Looming Regulation Amid Scandals and Security Concerns
Digital advertising, a staggering $700 billion (£530 billion) sector, has largely operated in an unregulated environment, presenting risks to both brands and consumers. Many companies remain unaware of where their ads are displayed online, leading to disturbing incidents of misinformation and fraud. As the founder of Check My Ads, an organization dedicated to monitoring advertising practices, I can attest firsthand to the prevalence of scams and manipulations affecting advertisers and the public alike. Our team regularly intervenes to remove ads from platforms promoting serious disinformation related to Covid-19, misleading electoral narratives, and even fabricated obituaries.
Currently, brands looking to promote their products rely on Google for ad placements based on specified metrics. While Google delivers impressions and clicks as stipulated, it offers little transparency regarding the origins of these engagements. This lack of oversight means that advertisements could appear on platforms that stand in stark contrast to the brand’s ethos. In 2024, investigations revealed that Google’s ad placements were seen on sites endorsing extreme pornography, disinformation, and hate speech, all without the brands’ consent.
Regulatory changes are anticipated to reshape this landscape by 2025, as lawmakers across Brussels, Ottawa, Washington, and London develop new frameworks for the digital advertising sector. These regulations aim to empower brands by granting them the legal avenue to question ad metrics, verify the integrity of ad placements, and obtain automatic refunds if their campaigns fall victim to fraud or other compliance breaches.
In Canada, the proposed Online Harms Act is being reviewed to penalize businesses profiting from illegal content involving minors. This law underscores the principle that if content is deemed illegal, capitalizing on it should also be prohibited. Such legislative initiatives reflect a growing recognition of the urgent need to protect digital ecosystems.
In the United States, particularly in California and New York—two pivotal hubs of the global ad tech landscape—advocates are pushing for the implementation of legislation mandating companies to verify their customers’ identities to monitor advertising-related financial transactions more effectively. New York houses more ad tech companies than any other global city, while California’s regulatory measures could significantly impact Google’s expansive international operations.
The unregulated nature of digital advertising poses broader implications for national democracy. In the United States, the spending on presidential campaigns, which is projected to reach up to $2 billion (£1.5 billion) on digital ads in 2024, remains largely unchecked. Existing laws currently provide no reliable external data concerning these campaigns’ refund rates or ad spending, raising concerns about transparency in political communications.
As 2025 approaches, pressures mount on large technology companies to address the challenges within ad technology. The cybersecurity aspect of the digital advertising ecosystem cannot be overstated. Ad fraud and misinformation can be viewed through the lens of the MITRE ATT&CK framework, where tactics such as initial access and exploitation of vulnerabilities are critical to understanding how these attacks manifest. With existing gaps in oversight and security, businesses must remain vigilant to mitigate the risks posed by an ever-evolving digital landscape.
In conclusion, as regulatory frameworks begin to take shape, the future of digital advertising may finally align with the imperative for enhanced transparency and stronger defenses against cyber threats. The developments ahead will undoubtedly influence how businesses navigate the complexities associated with advertising in the digital age. It is vital for organizations not only to prepare for impending regulations but also to proactively safeguard their advertising expenditures against fraud and misuse.
