2018 Annual Report
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Annual Report Center for Digital Democracy 2018
The Center for Digital Democracy’s (CDD) mission is to advance the public interest in the digital era. We believe that we fulfilled that commitment in 2018 through our leadership work on such key issues as promoting digital rights for privacy and fair treatment; advocating for safeguards to ensure responsible data and marketing practices in elections and other political campaigns; developing policies to protect children and youth from marketplace manipulation and other harmful practices, including to their health; and protecting the welfare of vulnerable Americans from discriminatory and unfair practices. We also continued to engage closely with international colleagues, helping develop global approaches addressing digital society-connected concerns.
CDD has assembled a team of dedicated and experienced professionals who bring expertise and leadership skills that help it build strategies designed to promote public policies, more effective corporate best practices, and new methods to reach and inform key stakeholders, including the news media. Our programs, while cross-cutting, also include several distinct focuses, which we identify as “Digital Citizen, Digital Consumer, Digital Health, and Digital Youth.”
One of CDD’s key strengths is its focus on tracking and analyzing commercial digital marketplace developments—to identify and then address the evolving or newly emerging practices that increasingly shape our daily lives. This review closely observes the dominant platforms, ISPs, leading brands, advertising companies, technology and application providers, and trade associations. It also includes business activities conducted throughout the world by many of these leading global entities. This review enables CDD to gain a more informed understanding of commercial data, and the marketing and policy strategies of specific leading companies, and supports a more robust understanding of industry-wide activities.
We use these insights to support our ongoing work educating the public concerning digital media issues that affect their everyday lives, as well as the future of our democracy.
Key 2018 Developments
Promoting digital safeguards for political/electoral campaigns: Political groups across the spectrum use the full array of data-driven and digital marketing techniques pioneered by the commercial sector. This includes data profiling, real-time targeting, geo-tracking, emotional analytics, and other manipulative and discriminatory practices. CDD has been closely analyzing these developments, including raising public concerns about practices used in the 2016 presidential campaign. Through a series of reports in 2018, as well as outreach to policymakers, journalists, and campaign-reform advocates, we have worked to broaden the debate about the role of data and digital marketing beyond the important issue of Russian interference to show how the basic operations of the digital marketing industry (especially the large platforms) can be used to undermine the democratic process.
Privacy and consumer protection online for youth: We continued to be in the forefront of work to ensure that the federal children’s online privacy law we helped get enacted in 1998—the Children’s Online Privacy Protect Act (COPPA)—is effectively enforced. We have conducted this work primarily by examining some of the most powerful commercial services targeting children, including video programming on YouTube and Google’s Play store for apps. Through a series of complaints filed at the Federal Trade Commission, as well as extensive outreach to the news media, we have kept both children’s and teen privacy—as well as the need for modernizing advertising safeguards for this vulnerable group—front and center before policymakers and the press. CDD has also helped create a new NGO working group to address the impact of Internet-connected toys and services for youth, and has supported research in this area. We continue to press regulators to address the needs of youth in the commercial digital marketplace more effectively. To celebrate the 20thanniversary of COPPA, CDD organized a Capital Hill event—covered by C-Span and featuring the law’s principal sponsor, Sen. Ed Markey—that focused on discussing new ways to better protect and empower youth in the digital commercial marketplace. We have worked especially closely on these issues with a number of allies, including the Campaign for Commercial Free Childhood, the Electronic Privacy Information Center, and the Consumer Federation of America.
Strengthening U.S. Privacy Safeguards: CDD played a crucial role promoting the need for the U.S. to adopt comprehensive regulations to protect privacy in the digital era. We approached this issue using a multi-dimensional strategy. In 2018, we proactively focused on the May 2018 implementation of the European Union’s General Data Protection Regulation (GDPR). CDD called on Facebook and other companies to commit to implementing the GDPR in the U.S. and worldwide—generating significant media attention and a response from Facebook’s Mark Zuckerberg. We brought new allies into the privacy debate, developing a relationship with Public Citizen that led to letters being sent to 100 leading U.S. companies asking them to also commit to GDPR like rules for the U.S. Additionally, we organized a media briefing for U.S. journalists on the GDPR that featured our EU colleagues working together with us as part of the Transatlantic Consumer Dialogue (TACD). CDD prepared background materials on the GDPR for outreach to press, policymakers, and key stakeholders. Our deputy director, Katharina Kopp, Ph.D., played an important leadership role helping bring together NGOs—including new allies from the civil rights community and other sectors—to collaborate on advancing policies on federal privacy. As part of its expansion in California this year, with a new office in Ventura, CA, CDD also played a key role working with other advocates to advance privacy protections in the state.
Protecting the public health, especially for youth and vulnerable communities: We continued our work addressing the impact of digital media on health outcomes, especially in the area involving the role that marketing plays in the obesity crisis. CDD is recognized as one of the leading organizations working on this by experts throughout the world. In 2018, we continued our unique partnership with the Berkeley Media Studies Group, Color of Change, and UnidosUS to develop safeguards dealing with targeted food and beverage marketing, especially advertising directed at youth of color. CDD’s unique role includes continually analyzing how the latest digital marketing and data developments may impact young people—especially with their dietary choices. We engaged in a significant amount of research—covering the key platforms, leading brands, as well as leading technology and advertising companies. This research contributed to the development of our partners’ strategy on this issue. We also linked with advocates and researchers in Canada and in the EU, where there has been major work and advances to address the digital marketing of unhealthy food products to children. CDD also reached out to both tobacco control advocates as well as those concerned about underage consumption of alcohol, to help foster a new collaboration related to public health and the impact of digital communications. Kathryn Montgomery, Ph.D., joined CDD this year as its new Director of Research. She is helping lead this initiative, along with Ms. Kopp.
Industry analysis and outreach to news media: CDD continued to inform the news media on the most important developments affecting privacy and online consumer issues, to keep the focus on the impact of the commercial marketplace on our lives. In 2018, this outreach was reflected in coverage by “Sixty Minutes,” the New York Times, The Guardian, NPR, and many other outlets.
Annual Report Center for Digital Democracy 2017
We also continued our strong media outreach program, resulting in coverage of CDD in dozens of articles by such major publications as the New York Times, Washington Post, Los Angeles Times, Wall Street Journal, Boston Globe, Politico, Bloomberg, and USA Today. CDD was also cited by news outlets based in the UK, Netherlands, France, Germany, Hungary, Ireland, Poland, Italy, Ukraine, Japan, Vietnam, Israel, and Mexico.
Among the highlights of our 2017 work are the following:
- Recognizing that the election of President Trump created significant new challenges for the consumer NGO community, we immediately organized a coalition of U.S. and EU digital rights groups to coordinate action across the Atlantic. A goal was to send a message to the new administration that consumer and digital rights policy safeguards are expected by diverse groups on a Transatlantic basis. Our first major success was collective action to protect the privacy of children and families in the emerging IoT marketplace. Leveraging EU research, amplified by U.S. media outreach (in which CDD played a lead role), our campaign made global headlines; forced online and offline retailers to pull products off their shelves; and sent an important message to both governments and industry that consumer groups are working more closely together to advance the public interest in the digital marketplace.
- CDD played a major leadership role supporting the passage of FCC consumer privacy rules for broadband ISP networks in October 2016. These were the most comprehensive digital safeguards ever enacted in the U.S. When the new administration and Congress announced plans to repeal the rule, we played a key role working with our consumer NGO allies, as well as with the news media, to provide data and analysis that revealed how the broadband ISP companies’ business plans were based on a significant expansion of cross-device data profiling— something the FCC privacy rule would have made much more difficult to accomplish. After Congress repealed this rule, we expanded our work beyond DC to promote state-based policies for ISP privacy. CDD played the lead role, for example, generating news media coverage for this work in California.
- Our ongoing analysis of the e-commerce marketplace identified the retail sector as another area of concern that could cause harm to already disadvantaged populations, such as people of color and low-income families. The United States Department of Agriculture (USDA) Food and Nutrition Service (FNS) launched an online purchasing pilot for its Supplemental Nutrition Assistance Program (SNAP) in 2017. Our research confirmed that the data privacy requirements as set out in the pilot’s Request for Volunteers (RFV), combined with the sophisticated ecommerce marketing strategies deployed by participating retailers and brands, will not provide sufficient safeguards against predatory marketing practices. If left unchecked, SNAP participants’ privacy might be further undermined—and their health also negatively impacted—as a result of expanded marketing of unhealthy foods linked to the obesity epidemic. We were also concerned that increased exposure to cross-device marketing that seeks to increase “basket size,” based in part on their SNAP participation, might undermining SNAP participants' ability to engage in asset building, as they are enticed and prodded via sophisticated digital marketing techniques to spend their limited resources unwisely. We reached out to the USDA and alerted them to the problems, and also involved a wide range of NGO, public health and academic stakeholders concerned about the SNAP program. Our work has placed SNAP’s ecommerce work on the agency’s policy agenda.
- In January 2017, CDD was one of the first NGOs to draw our attention to the role of Big Data and digital advertising in the 2016 election. CDD Executive Director Jeff Chester published an analysis entitled "Our Next President: Also Brought to You by Big Data and Digital Advertising—How the Trump campaign Used Big Data to Elect a President" on Bill Moyers’ website. We also organized a panel on the use of Big Data in political campaigns last spring in Washington, DC, at the annual Transatlantic Consumer Dialogue (TACD) meeting—helping place the issue before policymakers, the press, and civil society. In November, CDD filed comments and called on the Federal Election Commission (FEC) to hold hearings on the role of digital media in political campaigns. CDD also urged the FEC to begin a rule making to revise its regulations concerning disclaimers so the public has appropriate access to information regarding the operations of online ads and related content. We continue to study this issue, helping journalists cover what has become a much bigger story involving the role of Russia in the last election.
- CDD continued to play a leading role working with the TACD EU/U.S. consortium of privacy and consumer groups. In 2017, CDD worked to help support successful implementation of the European General Data Protection Regulation (GDPR), which is coming into force in May 2018. We see this as a unique opportunity to leverage the GDPR to pressure global U.S. companies that operate in the EU to extend the GDPR privacy rights to U.S. citizens and not discriminate against U.S. consumers in terms of privacy protections. In November, CDD and TACD hosted a half-day workshop on this topic in Washington, DC. The event—Ensuring Privacy Rights for All—brought together industry, privacy and consumer advocates, as well as relevant government authorities.
- CDD continued to exert pressure on U.S. companies that transfer data from the EU to the U.S. under the EU-U.S. Privacy Shield, and supported European consumer advocates in their efforts to ensure that EU citizens and consumers are protected as they would be under EU law. CDD provided comments to the European Commission's first annual review of the Privacy Shield in July of 2017, concluding that the rights of EU citizens under the Privacy Shield program are not equivalent to how they would be protected by EU law. CDD urged the Commission and EU Data Protection Authorities to suspend the Privacy Shield in light of its lack of any policies, rules, or enforcement that would provide meaningful adequacy or equivalency.
- CDD continued its leadership role in advocating for children’s privacy and for advancing digital rights of youth online. CDD's advocacy and research in 2017 focused particularly on investigations of Google, and especially YouTube, for violating COPPA, the children’s privacy law we helped pass in 1998. CDD worked to extend privacy safeguards to teens (via opt-in and other practices) including efforts to hold Facebook, Google, and other leading cross-device media companies serving youth more accountable. We started to have regular conversations with Facebook on setting appropriate safeguards for children and teens, particularly with regard to the marketing of unhealthy foods, often directed at children and families of color and low-income populations.
Annual Report Center for Digital Democracy 2016
The Center for Digital Democracy (CDD) is recognized as one of the leading consumer protection and privacy organizations in the United States. Since its founding in 2001 (and prior to that through its predecessor organization, the Center for Media Education), CDD has been at the forefront of research, public education, and advocacy protecting consumers in the digital age. It plays a unique role educating the public about critical digital media issues, and fostering widespread news coverage of issues that empowers citizens and consumers. At present, CDD is actively involved in five areas of concern:
- Digital Consumer Protection: CDD analyzes the impact of Big-Data technologies across a variety of fields, including financial services, health care, media and communications—and the increasingly personalized marketing that supports these sectors—as they affect individuals, their families, and their communities.
- Digital Health: With the release of a major new report on the privacy and consumer-protection implications of health-related wearable devices, apps, and new forms of online pharmaceutical advertising (discussed further below), CDD has positioned itself as a leading consumer advocate in the burgeoning “connected-health” field.
- Digital Marketing Safeguards: Beginning with its 2006 FTC filing on behavioral advertising and the groundbreaking 2007 report, “Interactive Food and Beverage Marketing: Targeting Children and Youth in the Digital Age,” CDD has become the leading nonprofit consumer advocacy organization addressing the latest commercial digital media developments, analyzing how the rapid growth of online and offline data collection, and advances in the creation and delivery of personalized marketing, are affecting individuals and communities.
- Digital Privacy: CDD has become one of the leading nonprofit defenders of consumer privacy, in both the U.S. and abroad. Through its strong collaboration with EU and U.S. consumer groups, and leadership with the Transatlantic Consumer Dialogue group, it has strengthened data-protection enforcement across the Atlantic—including for both Google and Facebook.
- Youth Privacy and Digital Marketing: Drawing on its longstanding and pioneering work in children’s media (dating back to its predecessor, the Center for Media Education, which spearheaded the passage of COPPA, the Children’s Online Privacy Protection Act in 1998), CDD has become the leading proponent of meaningful privacy safeguards for children and youth in the Digital Age.
Throughout these several projects and campaigns, CDD has managed to combine advocacy, industry research, coalition building, public education, and media outreach to hold accountable some of the most powerful corporations currently shaping our future, most notably those companies that dominate the global online landscape.
The following are highlights of CDD’s many activities over the past year:
- CDD played a major leadership role developing a campaign that led to the passage of new FCC consumer privacy rules for broadband ISP networks. These rules, passed in October, are the most comprehensive digital safeguards ever enacted in the U.S. Through its research, press outreach, and market analysis efforts, CDD helped frame the debate that will enable the public to require telephone and cable Internet providers to give them important new rights when it comes to the use of their data. For example, , CDD helped organize a letter to FCC Chairman Tom Wheeler, signed by more than 50 organizations, urging him “to commence a rulemaking as soon as possible to protect the privacy of broadband consumers,” and on 20 October joined with 10 organizations in a letter “urging Chairman Wheeler and Commissioners to vote next week to pass strong broadband privacy rules and not to yield to industry calls to weaken the current privacy proposal.”
- “Health Wearable Devices in the Big Data Era: Ensuring Privacy, Security, and Consumer Protection,” an extensive report on the rapidly expanding connected-health ecosystem (produced in conjunction with American University’s School of Communication and funded by the Robert Wood Johnson Foundation), was released in December 2016. “Many of these devices are already being integrated into a growing Big Data digital health and marketing ecosystem, which is focused on gathering and monetizing personal and health data in order to influence consumer behavior,” the report explains. As the use of these devices becomes more widespread, and as their functionalities become increasingly sophisticated, “the extent and nature of data collection will be unprecedented.”
- Also in December, CDD organized an unprecedented, coordinated, transatlantic legal action engaging consumer and privacy groups in the U.S. and Europe to address privacy and consumer concerns involving the emerging Internet of Things. CDD, in collaboration with the Campaign for a Commercial Free Childhood, Consumers Union, and the Electronic Privacy Information Center, filed a complaint at the Federal Trade Commission, calling upon that agency to investigate several manufacturers of Internet-connected “smart” toys that are in violation of COPPA’s privacy regulations. Leading European consumer organizations also filed a series of formal complaints with EU regulators, and with data protection, consumer protection, and product safety agencies in France, the Netherlands, Belgium, Ireland, and Norway. The filing sent a signal to the incoming U.S. administration that consumer protection and privacy must be on the agenda. As a result of the complaint, leading U.S. and EU retailers, including Toys R Us and Amazon, stopped selling the products.
- In October 2016, CDD filed a complaint at the Federal Trade Commission (FTC), in collaboration with the Campaign for Commercial-Free Childhood, Public Citizen, asking for an investigation and enforcement action against Google (a subsidiary of Alphabet, Inc.), Disney’s Maker Studios, DreamWorks-owned AwesomenessTV, and two other companies for the unfair and deceptive practice of targeting “influencer” marketing toward children. The complaint documented how several marketing companies—Collab Creators, Wild Brain, Maker Studios, and AwesomenessTV—produce and distribute ads and other commercial material targeting children that masquerade as content. It also detailed how Google encourages and benefits from the production of child-directed influencer videos and distributes these ads to children on its YouTube and YouTube Kids platforms. These “influencer” ads take unfair advantage of kids, who do not have the ability to recognize that companies use social media and YouTube celebrities to pitch toys, junk food, and other products. CDD also continued its work to protect young people from harmful digital junk-food marketing, through a variety of research, public education and advocacy efforts.
- Also in October 2016, CDD, the Center for Democracy & Technology, Benton Foundation, Privacy Rights Clearinghouse, and eight other consumer organizations filed an amici curiae brief in the FTC v. AT&T case before the Ninth Circuit Court of Appeals, “to highlight the potential far-reaching ramifications of this case as well as the degree to which the panel decision breaks from century-long precedent, thereby creating a sharp split among the courts of appeals.” CDD played a key role in organizing the brief, which was needed to defend the ability of the FTC to effectively protect the public’s right to privacy on digital networks
- In September 2016, following up on a 2014 FTC complaint that CDD and EPIC filed concerning Facebook’s acquisition of WhatsApp, CDD spearheaded an open letter from 14 consumer privacy organizations urging FTC Chairwoman Ramirez to prohibit WhatsApp’s plan to transfer user data to Facebook. This letter coincided with a complaint filed in August 2016 by CDD and EPIC, concerning the violation of commitments WhatsApp previously made to its subscribers. The EPIC-CDD complaint responded to an announcement from WhatsApp that the company planned to disclose the verified telephone numbers of WhatsApp users to Facebook for user profiling and targeted advertising. As the open letter explained, “WhatsApp plans to make material, retroactive changes to its numerous privacy promises regarding the use and disclosure of user data without first obtaining users’ affirmative express consent. . . . a clear violation of the prohibition on unfair and deceptive trade practices the FTC is obligated to enforce under Section 5 of the FTC Act.” As a result of this complaint and our outreach to EU allies, both the European Commission and Germany acted to require Facebook not to violate its commitments in regard to the use of WhatsApp data.
- As part of its international advocacy and leadership activities, CDD was part of a consortium (along with BEUC, EDRi, and the Trans Atlantic Consumer Dialogue—for which CDD’s executive director is US Co-Chair of its Information Society Policy Committee) that commissioned a study by researchers at the University of Amsterdam’s Institute for Information Law (IViR) to protect the public’s privacy rights in global trade agreements. Published in July 2016, the study shows that the EU does not sufficiently safeguard citizens' personal data and privacy rights in its trade agreements. The study was well received by EU policymakers, including in Parliament.
- In March 2016, CDD released a groundbreaking report entitled “Big Data is Watching: Growing Digital Data Surveillance of Consumers by ISPs and Other Leading Video Providers,” detailing the growing threats to personal privacy as phone and cable Internet service providers (ISPs), along with leading Internet companies, expand their ability to capture details about what we do online in order to target us with data-driven personalized advertising. The report examines AT&T, Comcast, Cablevision, Charter, Cox, Verizon, Dish, Time Warner Cable, Viacom, Google, News Corp. (Fox), Turner Broadcasting (Time Warner), and Disney, focusing on some of their recent data- and video-related advertising practices. As the report explains, “A vast storehouse of consumer data is now being added to the trove of ‘advanced,’ ‘addressable’ and online information already gathered by cable and telephone ISPs. ISPs have made partnerships with powerful data brokers, giving them insights into our online and offline behaviors. They are incorporating state-of-the-art ‘Big Data’ practices—such as ‘programmatic advertising’—that significantly threaten the privacy of subscribers and consumers. Incorporating elements of what is known as ‘behavioral’ targeting, programmatic advertising is fueled by powerful alliances among data, media, advertising, and technology companies, and encompasses nearly all the devices and formats we rely on—including mobile, audio, and video. Superfast computers analyze our information, using algorithms and other predictive decision- making to decide in milliseconds whether to target us for marketing and more. Through digital dossiers that merge all of this information, we can be bought and sold in an instant—to financial marketers, fast-food companies, and health advertisers, for example—all without our knowledge.”
- In April 2016, CDD filed comments with the FCC endorsing the agency’s important proposal to provide both choice and competition in the provision of navigational devices for video and related content. CDD strongly believes that the FCC should proceed with its plan to allow third parties to build and sell navigational devices. . . . The set-top stranglehold has impaired competition and programming diversity, and has undermined consumer privacy.” At the same time, CDD cautioned that existing set-top-box privacy safeguards were insufficient in the Big-Data era: “Navigational devices, regardless of whether they are provided by incumbents or third parties, require robust, new consumer safeguards. Contemporary commercial digital data practices have significantly outstripped—if not made irrelevant—the current FCC legal safeguards governing consumer privacy and set-top boxes. Information gathered by cable and telephone industry navigational devices is being put to use in far-reaching ways today. The collection, analysis, and use of consumer data for profiling, tracking, and targeting are at the core of today’s video business— whether delivered by multichannel providers, programming networks, or online (including over-the-top, [OTT]) services. Video delivery companies have embraced various forms of “programmatic advertising” and use “Big Data” processing technologies to continuously gather and integrate consumer information from multiple sources, including set-top/navigational devices. The navigational device is now the latest ‘screen’ to be incorporated into the cross-platform consumer-data collection system, with its information used to target subscribers and other household members with marketing delivered across all of the screens consumers use. Navigational device data are also being used to track subscribers when they shop and work outside the home, illustrating how such data are being merged with information coming from data brokers and data-targeting companies."
Finally, Katharina Kopp, Ph.D., a former privacy advocate and a vice president at American Express, joined CDD as its Associate Director and head of policy in June 2016.
Annual Report Center for Digital Democracy December 2015
Our activities in 2015 continued efforts to strengthen privacy safeguards for citizens and consumers. CDD also launched several new initiatives designed to protect the public from new and emerging concerns:
- Identifying (in collaboration with U.S. PIRG) threats to the economic security of financially at-risk consumers as a consequence of contemporary digital marketing practices promoting payday and other high-interest loans;
- Launching (with the Campaign for a Commercial-Free Childhood) a campaign opposing Google’s new YouTube Kids “app,” which ignored decades of child developmental research and long-standing federal policies designed to limit the role of advertising in children’s media;
- Creating advocacy strategies to support a range of key digital rights on behalf of a coalition of EU and U.S. consumer organizations (the Transatlantic Consumer Dialogue, TACD);
- Undertaking new research initiatives:
- An examination (with American University) of the privacy and consumer-protection concerns arising from the growth of the health “wearables” marketplace;
- A study (with the Berkeley Media Studies Group) of the dramatic expansion of “hyper-local” geo-tracking of consumers in their neighborhoods and communities by marketers and retailers, including companies promoting food products linked to the youth obesity epidemic; and
- A report on how the TV industry is increasingly using sophisticated digital data technologies to “spy” on viewers.
CDD also began working on the development of “cross-platform” consumer protection safeguards for digital media, focusing especially on the interests of children and adolescents. We also continued to play a pivotal role at the Federal Trade Commission (FTC), encouraging the agency to play a more proactive regulatory role (including on “Big Data” mergers and new forms of interactive ad practices).