- California voters just passed Proposition 24, a ballot move that expands the state’s existing privacy laws and allows large tech companies to collect the amount of data that people are allowed to collect.
- The law would make it harder for Facebook and Google to track people’s activity through third parties, which could derail the advertising business models of most tech giants, experts told Business Insider.
- When prop. 24 is only active in California, due to the state’s huge influence on the tech industry it will effectively apply to all US.
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A new law passed by California voters in the November election has overturned U.S. Will set an unprecedented standard for digital privacy, making it harder for big tech companies like Facebook and Google to track people’s data.
The Consumer Privacy Rights Act, also known as Proposition 24, was on its way to pass in California on Wednesday morning, with 56% of voters supporting the move and more than three-quarters of the ballots counted.
The law would strengthen privacy measures that exist in California, preventing consumers from selling or sharing their personal information, including race, religion, genetic information, geographic location and sexual orientation.
Advertising partners will also set strict restrictions on how websites track your data in order to sell that information. Google and Facebook – the two biggest players in advertising online advertising – both currently collect personal data collected by third-party websites to strengthen their advertising products, making up a large portion of their revenue.
Prop. 24, could effectively block companies like Facebook and Google from collecting that data, which could change their business model and reduce their existing revenue flows, privacy compliance experts told Business Insider.
VP of Privacy and Policy at BigID, a company that adheres to data confidentiality. “The third party ad tech industry needs to evolve … otherwise, their business models run the risk of becoming obsolete,” said Heather Fedmern.
A Facebook spokesperson did not comment on-the-record when reached by Business Insider. A Google spokesman did not immediately respond to a request for comment from Business Insider. No company has taken a public stance on Prop24.
The law comes because the business models of ad online advertising giants are facing other new risks. Apple is planning to update the iPhone software software, which will get users out of ad trackers, which Facebook has strongly opposed. Web browsers, including Chrome, Safari and Firefox, are rolling out similar tools to keep users out of tracking, which can reduce advertisers’ revenue.
Prop. 24 will be implemented starting from 2023. Prior to that, California regulators are expected to provide more details on how it will be implemented, which could shape its impact on large tech companies.
Despite the potential to hurt the ad revenue of large tech companies, prop. 24 has garnered the support of many tech business leaders who have advocated for privacy, including the former Democratic presidential candidate. Andrew Yang, Who argued that people need to be given more control over their data.
Raju Vegensa, chief evangelist at global software firm Firm Zoho, said he expects both private companies and the government to continue cracking down on third-party ad trackers due to growing consumer privacy concerns. Vogensa added that Zoho removed third party trackers from its sites in July.
“It means we put money on the table, but just because it’s there doesn’t mean you have to take it,” Vagensa said in an email to Business Insider. “The point of privacy notices for most countries will come when they realize how much data big tech companies like Google have collected on their citizens and as a government, they can’t do anything about it.”
Some privacy advocates have argued that the law is not moving too far, instead calling on Congress to pass a privacy law setting a nationwide standard. Advertising business groups have voiced similar complaints, Advocate reported – arguing that more laws should be passed to protect consumer privacy, but that laws should be enacted at the national level instead.
