Why should you familiarize yourself with the EU Digital Services Act?
Posted on February 28, 2022 (Last Updated: March 08, 2023)
For most of us 'DSA' means Dynamic Search Ads, but what else can this abbreviation refer to? The Digital Services Act is a legislative proposal issued by the European Union. It aims to modernize the regulations regarding the e-Commerce Directive about transparent advertising, illegal content and disinformation. It is expected to become a law in the spring of 2022.
What are digital services?
Basically any service provided for users on the Internet. This includes websites, social media, video or music streaming services and many more.
What is the purpose of the Act?
The aim after all is transparency. From a business’ perspective this involves an effort to eliminate the selling of fake products (distribution of off-brand products under well-known brand names). From a social point of view it is intended to reduce cyber crimes and hate speech. Finally from an economic aspect it is planned to establish balance and eliminate market dominance and illegal limitation of competition.
The concept is simple: the online world should be closer to the real world and what would be considered illegal in the latter one shouldn’t remain overlooked in the virtual space.
What is the scope?
The scope of the Act compromises companies that provide services within the EU. This means that all companies whose service can be accessed from countries within the European Union have to comply, even if they are based in a non-members country. A few examples are Spotify, Youtube, Instagram, Booking, Airbnb and other digital marketplaces.
What does this mean in practice?
DSA is intended to give a voice to people and enable them to comment on what they see in the virtual space. Users will have the chance to flag content they perceive as illegal or harmful and the platforms should provide them with an answer about the outcome of their revision. To make the process smoother a system of trusted flaggers is to be introduced.
Users will have the chance to avoid personalized content, and platforms will become more accountable for misinformation. This greatly affects ads that children can be exposed to. It is intended to make it easier for users to have an overview on what they consent to, and enterprises become more responsible for their algorithms. It is to be the companies’ responsibility to make sure their algorithms don’t create harmful spirals that can for instance contribute to the formation of eating disorders in adolescents.
The proposal also aims to fight so-called “dark patterns”, for instance the intentional hiding of buttons by placement or color (for example to get users to accept tracking).
What initial steps can I take as a marketer to comply with DSA?
The most important action to be taken is to be transparent. In case of ads this can be done by disclosing who places the ad, who pays for it and why it is shown to certain users. The discussion has started about taking further action to regulate digital marketing activities, it is best to get on board with the changes as early as possible.