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Encouraging Interoperability for a Thriving Ecosystem

  • Noel McMichael
  • 3 min read

In order to be useful, software and systems must securely work together in compatible formats. In simple terms, this is what is known as interoperability, where everyone’s systems can work with one another in a secure manner while parties maintain control. Interoperability offers three main benefits. First, it gives consumers practical control over their data. Second, it encourages innovation in both incumbents and challengers. Lastly, interoperability enables new entrants to gain data access and scale successfully.

An interoperable infrastructure facilitates a vibrant and transparent online experience for consumers, an innovative marketplace, and increased publisher and advertiser revenue. The nonprofit group Public Knowledge also asserts that, in addition to creating a competitive marketplace, interoperability is essential to empowering consumers’ data rights.

Google’s intention to end support for third-party cookies in Chrome was no surprise to those who were following similar actions by Firefox and Safari. The ad tech industry has long been complacent in relying on third-party cookies as an imperfect solution for interoperability on the open internet. And in uncertain times like today, it’s easy to lose sight of the importance of preparation and industry collaboration. 

So does that mean we are advocating for a browser ID or other form of identifier controlled by the browsers? Absolutely not. We want the post-cookie ecosystem to be better than what it replaced—one that is built on trusted and transparent first-party relationships between publishers and consumers and publishers and advertisers. An authenticated infrastructure gives individuals more control over their data and helps publishers build direct relationships with their readers. It also fosters higher-quality engagements for advertisers, increasing value for every player in the ecosystem. 

One of the best examples of interoperability is our modern banking system. While customers may have their assets with one bank, the lines of communication between banks are open so that customers are able to make cross-bank transactions securely with another customer at another bank. If this access were not possible, the entire banking system would be in disarray and crumble to a few major players. 

LiveRamp’s infrastructure was built with data democratization and neutrality at its core, encouraging interoperability. It is compatible with the technology of our competitors and supports our belief in an open ecosystem that provides a level playing field that is trusted, open, and neutral.

But as the deadline ticks towards the end of third-party cookies, our industry needs to resist moving towards closed systems. Data must be interoperable in a trusted and verified, privacy-conscious manner. We must continue to move forward with a secure and neutral ecosystem that encourages the “coopetition” that has propelled rapid innovation across our industry for the past 20 years. 

Excluding competitors from accessing the marketplace leads to a few dominant players—or sometimes only one—who can charge higher prices without the promise of innovation to compete for market share. That means a more static ecosystem with higher costs for advertisers, less choice and lower return for publishers, and substantially reduced free content for consumers (not to mention quality journalism funded by advertising). In that post-cookie world, the value exchange will be reduced at every level of the ecosystem.

This transition away from third-party cookies shouldn’t be the last wave of innovation in our industry. Rather, we must encourage an open ecosystem built on privacy, competition, data access and interoperability for the betterment of all. To encourage state-of-the-art data stewardship and an interoperable marketplace, we must call on legislators and policymakers to establish a national data privacy law, based on many of the existing principles and standards of organizations like the DAA and IAB.

Congress has taken an interesting and optimistic first step with the ACCESS Act, but in order to fully promote harmony between consumer privacy and market competition, policymakers must recognize that the browsers, iOS, and Android are critical to interoperability and should not play gatekeeper between consumers and publishers.

Visit our website to learn more about how LiveRamp encourages an open, trusted ecosystem.