Good surveillance? Tech funded with targeted ads isn’t all peril for the global south

Digital advertising is often targeted at individuals by inferring their consumer preferences from data about their online activity – the websites they visit, the social media posts they like and so on. In academia and public policy circles, the ubiquitous surveillance of online behaviour that is required for targeting systems to work is widely seen as morally objectionable. But is there something to be said in its favour? In this commentary, I want to develop a counterintuitive claim made in my book Good Data: that in important ways, the surveillance advertising business model serves the interests of the global south and can even be seen as an enabler of distributive justice.¹

By contrast, the subscription business model advocated by many critics of surveillance advertising could be expected to have regressive effects were it applied to social media. I focus on Meta, but the argument I present is applicable to other widely used services funded by surveillance advertising – notably those provided by Alphabet, the parent company of Google.

Before I get started, there are two philosophical debates I need to set aside. First, whether the collection of online behavioural data can meaningfully be described as ‘surveillance’² and second, whether it represents such a fundamental infringement of individual rights that no amount of good can possibly justify it. For the purposes of this commentary, let us allow (1) that ‘online surveillance’ serves as a useful shorthand for Meta’s practices with respect to data; (2) that utilitarianism is a plausible theory of ethics; and (3) that it is therefore at least possible that surveillance advertising could be justified on utilitarian terms in some circumstances. I must also stress that I do not presume to speak ‘for’ the global south, nor am I suggesting that there is a singularity of need across the diverse social, political, and economic spaces that constitute it. I simply take the view that people in the global south have as much right to aspire to and use all the technologies of modernity as anybody else.³

Objections to the surveillance advertising model

With that said, let us begin by briefly summarising the prevailing discourse about the surveillance advertising business model. Those who object to it typically do so for three reasons. First, they view the collection of user data for the purposes of targeted advertising as intrusive and covert and therefore regard it as a violation of privacy. Second, they worry that the use of this data may expose individuals to manipulation based on inferences about their psychological vulnerabilities, further diminishing their freedom. Third, they view the social relations created by the surveillance advertising business model as extractive, seeing user data as a form of digital property or labour surplus coercively taken from users whose condition is therefore one of serfdom.⁴

This view of surveillance advertising business models is widely held, demonstrably influencing actors such as the EU Competition Commissioner, Margrethe Vestager, and US Senator Elizabeth Warren.^{5 6} It has gained particular political traction in Europe, where the European Parliament and the European Data Protection Supervisor have recommended that surveillance advertising be phased out and eventually banned.⁷ Others, including the Danish government’s tech expert group and the Norwegian Data Protection Authority, have gone further, respectively proposing and implementing an immediate ban.^{8 9}

However, in both a geographical and a philosophical sense, this is a rather Eurocentric view – one that implicitly assumes that the interests of users in the global north are what matters, and neglects the interests of users in the global south.¹⁰  This is especially problematic given the geographic distribution of the users of services funded by surveillance advertising. If we look at monthly active user numbers for Meta’s Facebook platform, we find that only one of its top ten country markets is in the global north. By this metric, Facebook’s largest market is India (315 million users) and not the US (175 million). The Philippines (80 million) has significantly more Facebook users than the United Kingdom (34 million) and France (30 million) combined, while there are more Facebook users in Egypt (42 million) than in Germany (25 million).¹¹ From a utilitarian perspective, if we are to make moral judgements about surveillance advertising as a business model, we must make sure its consequences for users in the global south are appropriately weighted in the calculation.

Advantages for the disadvantaged

When Meta is looked at in global terms, it becomes clear that the economic effects of its surveillance advertising business model are surprisingly progressive. This is a function of the huge differences in the value to advertisers of users’ attention and clicks depending on their geographic location. Crudely, advertisers are willing to pay much more to reach a user in Germany than a user in Egypt, because the German user is likely to have much more money to spend on the advertiser’s products than the Egyptian user. At the same time, subject to their devices, bandwidth and ability to speak at least one of 111 officially supported languages, all users can access the same services from Meta – whether they are in Germany, Egypt, or elsewhere. As Runciman puts it, ‘the provision of free networking services in exchange for access to personal data creates inadvertent advantages for the disadvantaged, whose data are worth less to advertisers but who get the services anyway’.¹² Measuring the economic value to users of free digital services is notoriously difficult,¹³ so how are those ‘inadvertent advantages’ to be quantified?

When Meta is looked at in global terms, it becomes clear that the economic effects of its surveillance advertising business model are surprisingly progressive

Proponents of a subscription model for social media often suggest that users should pay a subscription fee equivalent to Meta’s average revenue per user to access Facebook and Instagram, in exchange for not being targeted with advertising.^{14 15 16}  In 2021, according to Meta’s annual report and accounts, this figure was $43.60 overall but varied widely based on geography: it was $202.12 in North America, $70.78 in Europe, $23.09 in Asia-Pacific, and just $12.02 in the Rest of the World region. If we follow these scholars and commentators and treat this revenue per user metric as a reasonable proxy for the value users receive from the services Meta provides, we can say that each user in North America and Europe subsidised users elsewhere to the tune of $158.52 and $27.18 respectively, while each user in Asia-Pacific and the Rest of the World gained $20.51 and $31.58 respectively (see Table 1). The overall outcome was that in 2021 some $51.5 billion of value was effectively redistributed away from the global north to the global south – slightly more than the $47.8 billion spent by the US government on overseas development aid that year.¹⁷

Table 1: Transfer of value between Meta users in different world regions, 2021 – revenue basis¹⁸

Some might object to the characterisation of this effect as a subsidy, on the basis that Meta might simply view the different regions of the world as different markets with different profit opportunities. However, when Meta’s $71.2 billion of costs and expenses are brought into the analysis, it becomes clear that both the Asia-Pacific and Rest of the World regions are unprofitable when these costs are allocated to users equally (see Table 2). Meta does not provide a regional breakdown of its costs, but we could reasonably assume that the pro rata cost of providing services in the global south is actually higher than in the global north given Meta’s investments in physical infrastructure such as cell tower networks and submarine cables. In that case, the transfer of value from the global north to the global south would be even greater than $51.5 billion.

Table 2: Transfer of value between Meta users in different world regions, 2021 – gross profit basis

It seems that – at least in the case of Meta – the surveillance advertising business model delivers huge economic benefits to the global south. If we were to turn to Rawls¹⁹  we might even call it a form of distributive justice, since it satisfies the difference principle by most benefiting the least advantaged.

What are the implications for public policy? Were online surveillance advertising to be banned by the EU and/or the US government, Meta’s business model would have to change. As data-driven targeting is one of the main reasons advertisers are willing to pay more for inventory on Facebook and Instagram than for other media, it seems unlikely that Meta’s shareholders would be content with a move to contextual or untargeted digital advertising given the detrimental impact this would have on the company’s revenue and margin. A more likely outcome would be that Meta would extend the subscription offering it launched in the EU, EEA and Switzerland in November 2023 to comply with European data regulations, with users required to pay fees for access to services.²⁰

Implications of a ban on surveillance advertising

Different fee models would have different implications for users in the global south. A flat fee equivalent to the €120-€156 per annum currently charged for the subscription option in Europe would see hundreds of millions of users priced out of Meta’s platforms. Even a seemingly modest annual subscription price of $43.60 – the amount required per user to match Meta’s 2021 revenues – would be 32 times more expensive for the average Indian user than for the average American user.²¹ Meta could, of course, decide to vary its subscription pricing by country. While this would mitigate the adverse effects on users in the global south, the geographic profile of Netflix usage – where annual costs for online video streaming services range widely from $37 in Pakistan to $243 in Switzerland²²  – suggests it would come nowhere near to offsetting them (see Chart 1). Instead, Facebook and Instagram would become – like Netflix – platforms for the affluent.

Chart 1: Comparison of Netflix and Meta users by world region²³

Another possibility is that lawmakers stop short of an outright ban but require instead that platforms using surveillance advertising adopt a so-called ‘freemium’ model, giving all users the option of paying to opt out of seeing advertising and the associated online surveillance. In this scenario, Meta would probably continue to provide core features of its services for free, while limiting other features to paid-for, premium, ad-free versions of its apps – much as X (formerly known as Twitter) has done under Elon Musk’s ownership. If the subscription revenues from the premium service cross-subsidised the free services, some of the current redistributive beneficial consequences for users in the global south would be preserved. However, the introduction of differentials between the free and paid-for services would make the ‘freemium’ model less egalitarian than the current model, reinscribing existing global economic inequalities.

Is there anything else we need to bring into our moral calculation? We will have to bracket discussion of whether or not social networking services like those that Meta provides – independent of the business model that supports them – are a net good for global society. Let it suffice to say that there is plenty of scholarship demonstrating that the services can be a good, including for users in the global south,²⁴ and that as there are no serious policy proposals to prohibit them, they must generally be accepted as being at least morally neutral. We should, however, acknowledge that any infringement of individual rights and freedoms from surveillance advertising business models also affects users in the global south, meaning that they too would benefit from policies which limited online surveillance practices – arguably to a greater extent than users in the global north, since there are more of them.

Taking account of the redistributive benefits

In the end, then, we should weigh the expanded freedoms all users would gain from greater restrictions on surveillance advertising against the tens of billions of dollars redistributed to the global south each year as an accidental by-product of these business models. My own view, detailed in Good Data, is that surveillance advertising does not compromise human freedoms in serious ways – it follows that the scope for expanding freedoms by banning it is therefore quite limited and likely to be insufficient to offset the economic downsides it would entail for the global south. However, I acknowledge that I am in the minority on this point and I do not expect those who see surveillance advertising as detrimental to human freedom to change their minds. What I would hope is that, as legislation designed to constrain these business models is developed in the EU and elsewhere in the global north, policymakers will consider the potential for it to have regressive outcomes and refine their proposals accordingly – in particular by stopping short of an outright ban. Online surveillance advertising is not all promise for the global south, but neither is it all peril.

Acknowledgements

The author thanks Dr Maha Rafi Atal, Professor Lisa Ann Richey, Sofie Elbæk Henriksen and participants in the workshop ‘Commodifying Compassion in the Digital Age’ at the Copenhagen Business School for helpful comments and discussion during the development of this work.

A version of this article originally appeared on the Bennett Institute for Public Policy’s website.