The future of monetisation for publishing has been turned upside down for several years. The advertising-based revenue model is undermined for several reasons, such as ad budgets moving to GAFAM, disintermediation and loss of margin, adblocking and the programmed extinction of third-party cookies, or the challenges to first-party data real value.
The context is likely to be further disturbed following a few last recommendations issued by the CNIL, the French Data Protection Authority, on the consent of cookies collection. The CNIL recommendations followed the European Data Protection Board’s (EDPB) guidelines on valid consent that ruled out cookie walls as a proper way for obtaining user consent to personal data processing and cookie use). These recommendations are welcomed and logical from a reader’s perspective. They empower users with a real command of their data. Still, it is likely to have a relatively strong impact on consent rates and ad revenues for publishers.
Admittedly, publishers have been diversifying their sources of revenue on digital since 2010. Notably, thanks to the rise of premium models and direct generation of reader revenue through subscription, donations, micro-payments… Yet, the proportion of readers ready to pay for information remains marginal.
So, how can you monetise an audience if an essential part of it has installed an adblocker, refuses to consent to cookies and does not want to pay to access content? Until then, there were few options available for publishers. But, during summer 2020, everything changed: the Conseil d’Etat, the supreme French Administrative Court, caused a breach in the position of the CNIL relative to cookie walls, stating that the French regulatory body did not have to forbid or to discourage them.
Cookie walls are a way for websites to deny users access if they don’t consent to all cookies and trackers present on that website. It’s a barrier of sorts that puts the user in a “take it or leave it” situation. They must either opt into marketing cookies and similar tracking technology or be denied access altogether to the website and its services. Though the idea of a cookie wall can seem exciting and appealing for publishers, a significant number of questions remain unresolved:
- What are the legal implications?
- How do readers perceive it?
- What experience should be offered to make readers stay?
- What are the first initiatives on the issue?
What does the law say on the matter of cookie walls?
What is the actual situation in the law and practice regarding the use of cookie walls? To help you see things more clearly, let’s take stock of French and European regulations concerning content access mechanisms and the concrete solutions available to publishers.
Cookie walls have still an ambiguous legal status. The cookie wall is a mechanism that allows publishers to block access to their websites and applications if cookies are refused. The cookie wall is useful to monetise publications, which is key for the survival of publishers. However, its legal status is ambiguous, as it has never been clearly defined, and therefore puts publishers in great legal insecurity.
The European ePrivacy Directive says that the regime of cookies that are not strictly necessary for the delivery of a service is subject to individuals’ consent. The General Data Protection Regulation has clearly defined the regime of consent as “any manifestation of free, specific, informed and unequivocal will by which the data subject agrees, by a declaration or by a clear positive act, that personal data relating to them can be processed”.
So, legally, whereas we know what consent is, we do not yet have a final position on whether the cookie wall prevents freedom of choice as an essential component of consent. Thus, when the French Data Protection Authority declared that it was not compliant with the GDPR, it did so without defining what it was exactly. For lawyer Etienne Drouard, however, it is clear: “if at least two options are available to access a service (a cookie wall and something else, such as a paywall or the creation of an account, for example), the cookie wall does not hinder the free consent of users, because an alternative is offered to them”.
The practice is in line with consumer law. The 2019 EU Directive on consumer protection states that it is legal to ask for compensation in exchange for the supply of a service and that this compensation can include personal data. We all experience this every time we use a search engine or a social network: the service is free in exchange for the collection of personal data.
The problem is not collecting data but whether this is done transparently with the user’s consent. Each user must be free to decide what compensation they ready to give to a service provider in exchange for access to their service: either they pay, or they register, or they accept cookies which allow publications, via advertising, to monetise the provision of the service.
Believing that everything would be free, without any compensation, is an economic illusion, not a legal requirement.
Providing a balanced alternative
Since the announcement of the public rapporteur, the CNIL has revised its recommendations and finally accepts the principle of cookie walls (article 18 of the deliberation of September 17th, 2020) under certain conditions, assessed on a case-by-case basis.
Legally, cookie walls are now compliant with the GDPR. However, they are still likely to infringe on the freedom of consent if no alternative is offered or if the alternative option is not well balanced, for instance, in the case of an excessive request for money in exchange for the service. Furthermore, the conditions for the use of cookies must be transparent and must indicate the purposes and recipients of the data. In the latest draft of the ePrivacy Regulation, which will provide the clear European legal framework that everyone needs, the door still seems open to cookie walls. It confirms indeed that a cookie wall does not necessarily deprive the user of a free choice; in other words, it does not “twist the user’s arm” by forcing them to consent.
“Making access to website content provided without direct monetary payment dependent on the consent of the end-user to the storage and reading of cookies for additional purposes would normally not be considered as depriving the end-user of a genuine choice if the end-user can choose between services, based on clear, precise and user-friendly information about the purposes of cookies and similar techniques, between an offer that includes consenting to the use of cookies for additional purposes on the one hand, and an equivalent offer by the same provider that does not involve consenting to data use for additional purposes, on the other hand.” (page 33 of the ePrivacy Draft, Brussels, November 4th, 2020)
In our view, publishers can still use cookie walls without hesitation, as long as they offer clear information and alternatives for accessing their services. This does not apply to essential services, such as public services, which everyone should access freely without consenting to anything.
Cookie wall and the reader experience
The topic of the cookie wall is very recent. It is also complex enough to require a good understanding of the legal implications and issues before considering any further steps.
The current legal framework allows us to imagine and glimpse what a cookie wall could look like on a publication website. But it is still rather vague. So what would be the concrete, visual aspect of the cookie wall? What are the possibilities for the publishers? And what are the implications and options in terms of user experience?
So, what does a cookie wall look like from a reader’s perspective? The cookie wall’s very idea is to offer the user to choose between 2 or more options to access the website, a section of the website, or even an article. A first option would be to give your consent to some purposes to access all or part of the website, depending on the media’s strategy. A second option could take several forms, such as suggesting a subscription or creating an account for the reader. Nothing is definite at this stage. Readers could have other alternatives, such as paying once or making a donation. Below is an example of a screen where the reader has two options: giving consent or subscribing.
At which point can the cookie wall be offered to the reader? On this issue, one can consider different options. While publishers have already adapted the consent screens on their homepage to provide these alternatives, they have a few alternatives to display their cookie wall banner. For example:
- On the homepage on the first visit.
- Within the content (as what is currently done in the case of a paywall).
- When accessing a category or section of the website (e.g. archives).
The consent rate is a vital indicator for publications, as it is estimated on average that a user who does not give their consent for advertising purposes yield up to 50% less on advertising revenues. A cookie wall is a tool that could be used to maintain acceptable consent rates, thus saving a part of the monetisation linked with advertising. In the coming months, we can assume that some publications will use it this way.
From the user’s point of view, the cookie wall is indeed one of the many barriers that the user will be confronted with during their reader journey. We can easily picture the following three types of walls for a publisher resorting to a paid model:
- Step 1 – Consent wall.
- Step 2 – Cookie wall.
- Step 3 – Paywall.
The cookie wall is one additional step in an already loaded user journey that includes other requests such as push notifications and suggestion to register to the newsletter. Over-solicitation generally does not bring anything good for the reader and therefore does not do any good to the publisher. Keeping this in mind allows publishers to raise questions on several levels:
- How to orchestrate the user’s journey?
- What is the main aim to be achieved at each of these stages?
- And which action should be proposed at each stage?
The cookie wall is not a mere opportunity to increase these consent rates. It is, above all, an excellent opportunity for publishers to try to create a lasting relationship with their readers. This last opportunity will also help to make revenue viable rather than merely seeking to maximise short-term gain. Other industries, such as gaming on mobiles or applications, have delved into this topic.
International publishers have already started implementing their own initiatives.
The Washington Post may have been one of the first private media outlets to initiate akin to a cookie wall. The idea is relatively simple: on a first visit to the Washington Post site, three options are proposed in order to “support quality journalism”:
- Option n°1 – Free of charge: read a given number of articles per month on the Washington Post site on the condition of giving consent to personalised, targeted advertising.
- Option n°2 – Fee-paying: taking out a digital subscription of 60$ per year giving access to the Washington Post content (site + apps) AND (an important point), providing consent to personalised, targeted advertising.
- Option n°3 – Fee-paying: taking out a digital subscription of 90$ per year giving access to unlimited content on the Washington Post (site + apps), benefiting from ad-free navigation and no tracking for personalized, targeted advertising purposes.
To access the Washington Post site, these are the only three options to choose from. The window on your screen cannot be closed. The only alternative is to leave the site. This initiative is a rather interesting one. It is the first example of its type and allows us to take a position regarding the interest and regularity of such an approach.
National Public Radio (NPR) has put in place another type of cookie wall. Two options are available within the frame of “Data Protection Choices“:
- Option n°1 – Free of charge: accept the cookies and access the NPR site using analytic technologies, social media functionality or personalised advertising that rely on cookies.
- Option n°2 – Free of charge: refuse cookies and still have access to the content, in a much simpler version (plain text), with no interaction or advertising and without any images or videos.
How do you feel about these examples from a user experience perspective? The value propositions are clear, and the options presented to the readers enable them to understand that, to navigate the Washington Post and NPR sites, they need to accept a quid pro quo.
The readers have a choice, the choice for a downgraded version of NPR, or to leave the Washington Post if no option suits them. From the user experience’s perspective, one could say that the situation has been handled well to initiate a dialogue with the reader on a sensitive subject: the media needs its readers, directly or indirectly, to produce quality information.
What can we conclude about these experiments from a regulatory perspective? Could a French publisher suggest these banners? Are they conceivable in Europe? In our view, the Washington Post example raises objections on two levels if it were to be implemented in France or Europe.
- Firstly, due to its non-compliance with the GDPR and ePrivacy. The first free of charge option effectively offers the user free access to the site of the Washington Post only as a quid pro quo of his or her consent for personalised, targeted advertising. However, the readers do not have the possibility of knowing the precise purpose that they have consented to, nor with which partners this data is shared.
- Secondly, it does not seem conceivable that advertising can be integrated with two options presented to a user, the first of which is to accept advertising tracking to be eligible for limited access to the site. The second option, which comes with a fee, makes the user eligible for full access where advertising tracking is accepted. Of course, it is easy to understand that such a proposition, when only two options are offered, cannot be envisaged for a cookie wall. If tracking is offered for advertising purposes and a subscription offer, the subscription package must at least be without advertising tracking and perhaps with no advertising whatsoever.
The Gamestar cookie wall example
The Gamestar website is published by Webedia (https://www.gamestar.de). It is a much more recent coming from Germany. Gamestar has set up a cookie wall that allows – on the left – the user to accept cookies to access the site free of charge with no possibility of refusing, or – on the right – to reject cookies by becoming a paying member.
Unlike the Washington Post, the Gamestar offers a more accomplished informative option to the reader, particularly in terms of objectives and responsibilities of managing who has access to the data. The publisher shows the list of partners and its goals effectively.
This initiative seems more transparent than that of the Washington Post’s. Some frustration may arise from not being able to reject cookies and tracking to access the site without paying. With this setup, Gamestar displays a cookie wall validated by the IAB and complies with the Transparency 1 Consent Framework (TFC).
Conclusion
To sum it up, cookie walls are a more critical issue for media than the mere optimisation of consent. It is, first and foremost, an additional opportunity to open up a dialogue with the readers on the question of payment. The issues of paid compensation and open conversation with the reader represent the future of monetisation for the media.
Regardless of the publisher’s revenue model, a strong and defined brand and an optimised user experience constitute the basis of any sustainable revenue model. If the cookie wall fits into this framework, then it will have a more lasting role. If the choice is clear and open, then cookie walls can represent a welcomed and popular option for the readers. But it is still early days. From a legal or user experience standpoint, nothing has yet been defined with certainty, and everything remains to be done. The cookie wall represents excellent potential for experimentation and innovation, and early publishers like NPR, Gamestar and The Washington Post have paved the way.
Maxime Moné
CEO and co Founder, Poool
This article is an executive summary of a white paper published by Pool and Didomi with lawyer Etienne Drouard. Didomi and Poool have collaborated towards a proof of concept of cookie walls, which will soon be available for publishers. Contact and inquiries.