' Josh Zhao | MTTLR

From Third-Party Data to First-Party Data: Is FLoC right for the future?

Third-party cookies are often used by advertisers to track users’ activities across websites to show them relevant ads. While these cookies are beneficial for websites due to the advertising revenue they generate, these cookies are often criticized for the lack of privacy they provide users and the amount of data they collect. The data these cookies provide can be used to build a significant profile of an individual without their consent or knowledge. In addition, this data is often sold without the user’s explicit knowledge and consent to various companies for marketing or other purposes. Issues with third-party cookies afflict even reputable news organizations, who create privacy risks through their advertising on controversial articles while simultaneously reporting on privacy violations by government agencies such as the NSA. Fortunately, the European Union has required since 2019 that users must give their informed consent to non-essential cookies and users are assumed to have opted out unless they opt in. Websites must provide this consent option through banners displayed at the top or the bottom of a page which over time have grown to include additional disclosure information. A European court has determined that an already checked box is insufficient consent and the user must check the box themselves. Privacy laws similar to those passed in the EU have also been passed in Canada and Brazil. Unfortunately, these banner alerts are often not effective because users simply click past the alerts without reading the website’s cookie policy, which can be many pages long. In some cases, users view these alerts more as pop-ups and a nuisance rather than as informative or important,...