With Prop 24, California is trying to rewrite the rules of online privacy. Again

By Sam Dean, Los Angeles Times on

Published in Business News

Opponents argue that Proposition 24 isn't just a missed opportunity - it actually would make things worse. The ACLU points to a proviso in the ballot measure for "loyalty card" systems in particular, calling it a brand-new "pay-for-privacy" loophole that could threaten the rights that Californians already enjoy.

This part of the measure would allow companies to charge more or alter their business experience depending on whether people decide to share their data with them. This would make it legal for Starbucks (or any other business) to keep offering loyalty card programs, which offer discounts in exchange for a customer's contact information and spending habits. But on the flip side, it also would make it legal for websites to limit access for people who don't want their data tracked or sold - for instance, a news website asking users to turn off an ad blocker before they can read free articles.

Mactaggart frames this section as a concession to the reality of widespread loyalty card systems and a sop to online publishers. The measure says the gap between prices offered to people who share data and people who don't can't be larger than the value to the business of the data itself, which is generally measured in cents or single-digit dollars. Anyway, Mactaggart says, this is currently legal under the California Consumer Privacy Act, since it's not explicitly disallowed - Proposition 24 just adds clarity.

The ACLU disagrees. "Prop. 24 reinforces this notion that companies should be allowed to charge people for their privacy," argued ACLU attorney Snow. He said that privacy-minded opponents of the measure aren't pitting the perfect - a measure with a private right of action and opt-in requirements - against the good in this situation. "We think it's overall a step backward."

That puts groups like the ACLU in the unusual position of siding with the online data industry - and actually working harder to oppose Proposition 24 than the businesses that would be affected by it.


A coalition of progressive groups that includes the California League of Women Voters and the California Nurses Assn. created a "No on 24" political committee to advocate against the measure but has raised only $20,000 to Mactaggart's more than $5 million in support. The online advertising industry, which took a major financial hit in the pandemic, hasn't contributed at all.

"Leadership at companies are dealing with a lot of challenges - survival being a primary one," said Alex Propes, vice president of public policy at the Interactive Advertising Bureau, an online advertising industry group. "Companies are as resource-constrained as they've been in modern history, and it takes time and energy to both interpret what impact it'll have on their companies and what their position should be."

With more pressing problems on their hands, companies that rely on consumer data are sitting out the fight over this complex measure that wouldn't go into effect until 2023, if voters approve it.

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