Consent-or-pay: Difference between revisions
→How it works: Formatting and reordering |
clean-up |
||
| (13 intermediate revisions by 2 users not shown) | |||
| Line 1: | Line 1: | ||
{{Stub}} | {{Stub}} | ||
Consent-or-pay is a business tactic in response to the European | '''Consent-or-pay''' is a business tactic in response to the European Union's ''[[General Data Protection Regulation]]'' [[General Data Protection Regulation|(GDPR)]]. Under this model, users of a website must either: | ||
*'''Consent''' to the use of cookies and personal data for targeted advertising, '''or''' | |||
*'''Pay''' a small monthly fee to access the service without tracking. | |||
The practice generated significant debate among regulators | The practice generated significant debate among regulators, policymakers, and consumer advocates alike and is viewed as undermining meaningful consent. Despite controversy, the model is being increasingly adopted by large online platforms and news organizations. As of August 2025, 16 of the 50 largest UK news websites had implemented consent-or-pay.<ref name="Press Gazette">{{Cite web |first=Charlotte |last=Tobitt |title=Press Gazette, More UK news publishers are adopting 'consent or pay' advertising model |url=https://pressgazette.co.uk/marketing/consent-or-pay-uk-publishers-advertising-2025/ |url-access=limited |date=21 Aug 2025 |access-date=1 Sep 2025 |url-status=live |archive-url=https://web.archive.org/web/20250821204423/https://pressgazette.co.uk/marketing/consent-or-pay-uk-publishers-advertising-2025/ |archive-date=21 Aug 2025}}</ref> | ||
==Background== | ==Background== | ||
{{Main|General Data Protection Regulation}} | |||
The General Data Protection Regulation was passed in 2018 with the aim of protecting online users from excessive data collection by large companies. The regulation does this by requiring companies to allow users to consent to data collection, and this is often done by an opt-in banner or pop-up on the home screen of any given website. | |||
Companies began feeling like they were losing revenue over this new regulation because they could no longer collect data for targeted ads at the same scale they'd done before. This led to the new consent-or-pay model as a workaround. | |||
==How it works== | ==How it works== | ||
When a user visits a website, a pop-up consent window is displayed. Traditional options would be '''Accept''' or '''Reject''' cookies. However the user is presented with the options to '''Accept or Pay'''. | When a user visits a website, a pop-up consent window is displayed. Traditional options would be '''Accept''' or '''Reject''' cookies. However the user is presented with the options to '''Accept or Pay'''. | ||
* The payment is typically a low fee ( | *The payment is typically a low fee (e.g. £1.99 per month). | ||
* Many of the sites that use the model were previously free-to-access and funded primarily through advertising. | *Many of the sites that use the model were previously free-to-access and funded primarily through advertising. | ||
* Consumers must now | *Consumers must now "pay" either with their personal data or with money. | ||
This effectively introduces a '''paywall for previously freely accessible content''' | This effectively introduces a '''paywall for previously freely accessible content''' even if no traditional subscription model exists. | ||
==Why it is a problem== | ==Why it is a problem== | ||
===Invalid consent=== | |||
This binary model of data collection creates the illusion of consent because users are compelled to choose one of two bad options, both of which require loss in exchange for content that is generally considered free access. | |||
===Lack of informed consent=== | |||
Companies often inform users that cookies and data collection are for "personalized ads" and "improving services". What they do not express is how a user's personal data is stored in data centers, shared among third-parties, sold to data brokers, and often become publicized through breaches. Users underestimate the costs of giving away their personal data, believing that advertisements of things they're already interested in makes their data a fair trade-off. | |||
===False equivalence=== | |||
The consent-or-pay model creates a false equivalence between two options. It denotes that the company loses, say, $2 or $5 a month when a user rejects targeted ads. This is an impossible metric considering that there is no way to guess whether the individual user would have purchased any item that is advertised to them. At best, this means the monthly fee is completely arbitrary. At worst, it is based upon a percentage of users who do happen to make purchases and is then unfairly distributed upon all users, irrespective of purchase or ad consumption, which is also known as ''average revenue per user (ARPU).'' | |||
===Illusion of fair exchange=== | |||
For users, the consent-or-pay model leads to a false belief that a fair exchange is taking place. When a company asks for a price as low as $2 a month while seeking data collection as a "free" alternative, the user is led to believe that they are fairly reimbursing the company for loss ad revenue, especially for such a low monthly fee. In susceptible users, they may be tricked into believing this is a fair and ethical decision they are making, thus happily choosing to engage in a deliberately misleading practice. | |||
==Meta investigation and fine== | ==Meta investigation and fine== | ||
After a year-long investigation by the European Commission, [[Meta]] was fined on 23 April 2025 for failing to comply with the [[Digital Markets Act]] (DMA). The European Commission's investigation targeted Meta's consent-or-pay model because it failed to meet the DMA's criteria of reducing personalized data for targeted ads and it does not allow users to freely consent.<ref>{{Cite web |date=30 Jun 2024 |title=Commission sends preliminary findings to Meta over its "Pay or Consent" model for breach of the Digital Markets Act |url=https://ec.europa.eu/commission/presscorner/detail/en/ip_24_3582 |website=European Commission}}</ref> Consequently, Meta was fined with €228 million in the month of April, and in July, the European Commission warned that the social media company may face accrued daily fines if they continue employing this tactic.<ref>{{Cite web |author=Foo Yun Chee |title=Meta may face daily fines over pay-or-consent model, EU warns |url=https://www.reuters.com/sustainability/boards-policy-regulation/meta-will-only-make-limited-changes-pay-or-consent-model-eu-says-2025-06-27/ |date=27 Jun 2025 |access-date=1 Sep 2025 |website=Reuters |url-status=live |archive-url=https://archive.is/WlLFg |archive-date=1 Sep 2025}}</ref> | |||
==Other uses== | ==Other uses== | ||
===News organizations=== | ===News organizations=== | ||
Many media outlets have adopted consent-or-pay throughout Europe, including: | |||
*The Mirror | *The Mirror | ||
*The Independent | *The Independent | ||
*Der Spiegel | |||
*Der Standard | |||
*Le Monde | |||
*Le Parisien | |||
*Corriere della Sera | |||
==Response== | ==Response== | ||
===Criticisms from policymakers=== | ===Criticisms from policymakers=== | ||
Example Text | In 2024, the European Data Protection Board (EDPB) published a non-binding opinion on "Valid Consent in the Context of Consent or Pay Models Implemented by Large Online Platforms." The EDPB denotes that the consent-or-pay model does not constitute as valid consent and that appropriate alternative measures to the model should provide users with an "equivalent alternative". Additionally, they say that if a company wishes to use a payment model, then the opposing equal alternative should not involve processing personal data. Any choice in which users feel compelled to consent does not qualify as valid consent.<ref name=":0">{{Cite web |date=17 Apr 2024 |title=EDPB: 'Consent or Pay' models should offer real choice |url=https://www.edpb.europa.eu/news/news/2024/edpb-consent-or-pay-models-should-offer-real-choice_en |access-date=1 Sep 2025 |url-status=live |website=European Data Protection Board}}</ref> | ||
Anu Talus, Chair of the EDPB, said:<blockquote>"Online platforms should give users a real choice when employing 'consent or pay' models. The models we have today usually require individuals to either give away all their data or to pay. As a result most users consent to the processing in order to use a service, and they do not understand the full implications of their choices."<ref name=":0" /></blockquote> | |||
===Consumer advocates=== | |||
{{Incomplete section}} | |||
Example Text<ref>{{Cite web |last=Illman |first=Erin Jane |date=29 Jul 2024 |title=Can Privacy Be Bought? How Scrutiny of Meta's Subscription Model Has Wider Implications –PART II |url=https://natlawreview.com/article/can-privacy-be-bought-how-scrutiny-metas-subscription-model-has-wider-0 |website=The National Law Review}}</ref><ref>{{Cite web |date=28 Nov 2023 |title=noyb files GDPR complaint against Meta over "Pay or Okay" |url=https://noyb.eu/en/noyb-files-gdpr-complaint-against-meta-over-pay-or-okay |website=noyb}}</ref> | |||
==Effectiveness== | |||
The effects of the consent-or-pay model vary widely. | |||
=== | * Advertising Week reports only 30% of users accept the cookies after the GDPR<ref>{{Cite web |last=Mititelu |first=Andra |title=As the Open Marketplace Fails, Advertisers Are Turning to Publishers to Reach Audiences |url=https://advertisingweek.com/as-the-open-marketplace-fails-advertisers-are-turning-to-publishers-to-reach-audiences/ |website=Advertising Week |date=2023 | ||
|access-date=1 Sep 2025 |url-status=live |archive-url=https://web.archive.org/web/20230927212627/https://advertisingweek.com/as-the-open-marketplace-fails-advertisers-are-turning-to-publishers-to-reach-audiences/ |archive-date=27 Sep 2023}}</ref> | |||
* (2023) According to The Drum, as much as 40% of users simply use a {{Wplink|VPN service|VPN}}<ref>{{Cite web |last=O'Connell |first=Vanessa |title=70% of consumers blocking cookies online, research shows |url=https://www.thedrum.com/opinion/2023/05/09/70-consumers-blocking-cookies-online-research-shows |website=The Drum |date=9 May 2023 |access-date=1 Sep 2025 |url-status=live |archive-url=https://web.archive.org/web/20230511090722/https://www.thedrum.com/opinion/2023/05/09/70-consumers-blocking-cookies-online-research-shows |archive-date=11 May 2023}}</ref> | |||
* (PG 2025) Meanwhile, "When users are equally offered the chance to "accept all" or "reject all" cookies, consent rates are typically somewhere around 70-80%, according to both Skovgaards and Contentpass founder Dirk Freytag.<ref name="Press Gazette" /> | |||
==Alternative practices== | |||
The Guardian develops a new "contextual advertising" model that bases ads upon whatever page the user is currently viewing (i.e. food ingredients on a recipe page). They say, "It's a perfect advertising product for a privacy conscious brand and a brand doing the right thing." They report a 35% increase in clicks.<ref>{{Cite web |last=Maher |first=Bron |title=Guardian gets around readers who reject cookies with new advertising product |url=https://pressgazette.co.uk/marketing/guardian-light-reject-cookies-advertising-stereotype/ |url-access=limited |website=Press Gazette |date=21 Nov 2023 |access-date=1 Sep 2025 |url-status=live |archive-url=https://web.archive.org/web/20231128184011/https://pressgazette.co.uk/marketing/guardian-light-reject-cookies-advertising-stereotype/ |archive-date=28 Nov 2023}}}}</ref> | |||
==References== | ==References== | ||
{{ | {{Reflist}} | ||
[[Category:Common terms]] | [[Category:Common terms]] | ||