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| California’s AI Crackdown: What SB 1047 Means for Ad Tech and Beyond |
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| California is at it again. Just like they did with CCPA and data privacy, they’re ready to take the lead, this time with AI regulation through SB 1047. With the bill awaiting Governor Gavin Newsom’s signature, the world’s fifth-largest economy is positioning itself as the epicenter for AI oversight. SB 1047 zeroes in on safety measures for large-scale AI models, including mandatory testing and “kill switches” for rogue systems. This regulatory move could send waves through every corner of the tech world — and ad tech isn’t getting a free pass here. Titans Clash Over AI Regulation: The tech world is not having a kumbaya moment over this bill, with AI powerhouses battling it out. Geoffrey Hinton, AI’s “godfather,” has thrown his support behind the bill, while Meta’s Yann LeCun is calling it a tech-killer. Elon Musk, of course, is team regulation — but even the tech world can’t seem to decide. Critics argue SB 1047 could squash innovation, especially for startups and open-source developers, but supporters say it’s a necessary safeguard for the future. Why Ad Tech Should Care About This: If you think this is just about tech giants, think again. AI runs everything from programmatic ad buying to personalization, and consumer data analysis. Should California move forward with this legislation, it’ll mean more compliance, higher costs, and cautious AI rollouts for the ad tech industry. It might slow down how fast ad tech companies can adopt new AI-powered innovations, with more focus on safety than speed. AI Vulnerabilities Extend Beyond Streaming: The connection between AI and fraud isn’t limited to programmatic ads — it’s also happening in the music industry. As highlighted in a recent Billboard article, AI-generated content was exploited to the tune of $10 million in fraudulent royalties, showing just how vulnerable AI systems can be when left unchecked. The same issues could bleed into digital advertising, where fraudsters use bots and AI-driven automation to manipulate ad impressions, clicks, and placements. For advertisers, there’s a real risk that their ads might end up running alongside fraudulent content, undermining brand safety and eroding consumer trust. Beyond the California Bubble: Like CCPA before — SB 1047 could spark a domino effect in the U.S. forcing other states or even the federal government to act — much like the EU’s AI Act has done overseas. AI regulation is no longer a tech-only issue — it’s a global business issue. If other states or even the federal government follow suit, publishers, advertisers, and tech platforms alike will be scrambling to keep up with new compliance rules. Walking the Tightrope: Innovation vs. Regulation: AI innovation loves to move fast and break things, but safety concerns are real. The bill’s focus on AI models with $100 million in development costs is aimed at keeping the big players in check, but that doesn’t mean smaller developers won’t feel the ripple effect. There’s a fine line between protecting the public and stifling innovation, and California is banking on getting it right. What’s Next for Publishers and Ad Tech? The writing’s on the wall. Publishers and ad tech companies better start planning. Compliance won’t be optional If this bill becomes law — it’ll be the cost of doing business. The larger platforms with deep pockets will have the upper hand in managing these new regulations, while smaller firms might struggle to keep up. For advertisers, the question becomes: how can we innovate while playing by the rules? - LdJ |
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| AI at Any Cost? Meta’s Use of Australian Data Without User Consent |
| Facebook admits to collecting public photos, posts, and other data from Australian users to train its AI models without offering them the ability to opt-out, unlike users in the European Union. At a Senate inquiry, Meta's global privacy director, Melinda Claybaugh, initially denied sweeping claims that the social media giant used all Australian data. However, further testimony revealed that Meta was playing a semantics game. She later admitted that unless users set their posts to private, the company scraped content from public accounts dating back to 2007. Claybaugh confirmed that they don't collect data from minors' accounts, but it does include public posts of children on adult accounts. How are we still playing this game with all the criticism of brands' privacy compliance practices? I know there is still a need for federal AI regulation, but this seems like a no-brainer. Of course, we do have some state regulation in the works, such as California’s AI bill. While Meta provides an opt-out option for users in the EU due to strict privacy laws, Claybaugh explained that Australian users do not have the same choice. As Compliant CEO Jamie Barnard described, US consumers also lack the option of explicit consent, but he believes that is the future of US privacy regulation. Clearly, both still have much to learn from the EU's compliance regulations. Yet Claybaugh emphasized that Meta needs vast data to improve its AI products and ensure they are safer and less biased. Compared to Europe, Australia's lack of privacy protections sparked criticism, with Senator David Shoebridge arguing that the government's delay in updating privacy laws allows companies like Meta to continue monetizing users' data unchecked. - AB |
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| Apple, Google & the Regulators' Warpath: Is Big Tech’s Golden Age Over? |
| The EU just hit Apple and Google where it hurts — Apple was slapped with a 13 billion euros tax bill while Google’s 2.4 billion euros fine for abusing its shopping service was upheld. Last week wasn’t just a "bad week" for Big Tech. These rulings signal that governments, both in the U.S. and Europe, are finally growing a backbone when it comes to reining in tech’s monopolistic tendencies. What’s wild is that for years, these companies felt untouchable. Sure, there were fines before, but this feels different. The EU is saying, "You can’t just flaunt the rules and expect to get away with it," while the DOJ and UK’s CMA are lurking in the background, sharpening their own knives for the next attack. This isn't a random coincidence — global regulators are coordinating like never before. Just last week, the DOJ came for Google’s ad tech dominance in court, accusing them of a campaign to "control and tax" digital advertising. And the CMA? They’ve already turned up the heat on Google’s ad stack, targeting everything from AdX to DoubleClick. So what does this all mean for digital advertising? In short: disruption. If regulators keep winning, the ad tech landscape could get messy fast. Google’s stranglehold on the entire ad stack — auctions, delivery, data — might finally loosen, giving room for competitors to make moves. But let’s be real: breaking free from Big G won’t be a clean break. The ecosystem has been built around Google for years, and for better or worse, publishers and advertisers depend on it to keep the cash flowing. For publishers, this could go one of two ways. On one hand, loosening Google’s grip might mean more options and better terms as new ad platforms compete for their business. But on the flip side, the transition away from Google’s tech stack could bring chaos—think revenue disruptions, complex integrations, and lots of uncertainty. If regulators succeed, publishers must adapt fast or get caught in the fallout. The bigger picture? We’re seeing the beginning of a power shift. Governments are starting to flex their muscles, and Big Tech can no longer hide behind borders or tax loopholes. These rulings might only be the start. The EU’s top court, DOJ, and CMA are all locked and loaded, and if they get their way, Google’s ad empire might look a whole lot different in the coming years. For anyone in digital advertising, that means you better start preparing for a new game — one where the old rules don’t apply. - LdJ |
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