The Federal Trade Commission (“FTC”), in its ongoing efforts to refine its approach to data privacy enforcement, convened a workshop earlier this year titled “Measuring Injuries and Benefits in the Data-Driven Economy,” a full day, public event held in Washington, D.C., examining how regulators, economists and market participants should measure consumer injuries and benefits in today’s data-driven economy. The workshop featured panelists including FTC leadership and staff, as well as academic economists and legal scholars, and drew attendees from across government, academia and industry. The panel discussions revealed important signals for businesses that rely on data monetization, targeted advertising, user-dependent pricing and data sharing with advertisers.
The workshop laid evidentiary and conceptual foundations for enforcement efforts and potential rulemaking. In distancing itself from earlier “harm-based” enforcement approaches, the FTC is developing what Chairman Andrew Ferguson described as “empirical” frameworks designed to withstand judicial scrutiny. The panel discussions also underscored how privacy regulation may impact competition, with implications extending beyond consumer protection.
How to Define and Measure “Privacy Harm”
Throughout the workshop, presenters highlighted difficulties in defining and quantifying privacy-based injuries. Unlike traditional consumer-protection frameworks analyzing deception and financial loss, modern privacy concerns can involve diffuse harms, such as users’ discomfort when perceiving a loss of control over their data, reputational risk for businesses leveraging user data and long-term economic consequences, including effects on pricing, competition and innovation incentives.
Across panels, experts generally agreed that consumers often do not know how their data is collected, shared and monetized. This information gap complicates efforts to determine whether consumers are truly harmed by certain data practices or simply unaware of the benefits and tradeoffs. Panelists also observed uncertainties in whether common tools like disclosures, consent mechanisms and privacy notices meaningfully address these concerns.
The FTC emphasized that future enforcement actions based on Section V of the FTC Act will need to show, not only that a business practice is unfair or deceptive (just as before), but that it also causes measurable consumer injury that outweighs any benefits (e.g., innovation, competition and access to free services). For businesses, the FTC’s comments suggest that enforcement and liability may increasingly turn on whether regulators can identify concrete economic harms or adverse impacts on consumer welfare, rather than abstract concerns about data collection.
Data-Driven Practices Yield Real Market Benefits
At the same time, panelists repeatedly emphasized the substantial benefits flowing from consumer data collection. Personalized content, product recommendations, search results and targeted advertising were repeatedly lauded for reducing search costs, improving product matching and enhancing consumer engagement.
Panelists also highlighted empirical evidence showing that targeted advertising can improve marketing effectiveness, lower customer acquisition costs and support ad-funded content models that cost consumers nothing or very little. Data analytics were also linked to broader benefits including fraud detection, credit-risk pricing and improved operational efficiencies.
Some speakers noted that smaller or niche businesses may rely heavily on digital advertising tools to reach their audiences. Restrictions on data use, therefore, could disproportionately harm smaller companies lacking large pools of first-party data or established brand recognition, and thus hurt competition.
The FTC’s comments suggest that enforcement efforts under the current regulatory climate are unlikely to treat data use as inherently problematic. Instead, businesses should expect the FTC to focus on economic analyses and market competition.
The Redistribution Effects of Behavioral Advertising
Despite the acknowledged benefits, behavioral targeting emerged as a key area of regulatory concern. Researchers presented evidence suggesting that targeted advertising can sometimes lead to higher prices, exposure to low-quality or fraudulent products or amplification of misinformation.
Other discussions focused on how targeting technologies might have an outsized impact on users who are more vulnerable to unfair manipulation or financial harm. These effects may be difficult to detect or measure, but the workshop illustrated their growing role in policy discussions.
Panelists identified yet another risk prompting more oversight: lower barriers to digital advertising may facilitate market entry by bad actors. This dynamic could shift enforcement responsibility toward platforms and intermediaries tasked with monitoring advertising quality and preventing abuse.
Taken together, these themes suggest that FTC scrutiny will likely focus less on whether businesses collect or use data and more on how those practices influence real-world outcomes across consumer groups.
Privacy Regulation May Reshape Competition and Market Structure
The workshop also highlighted how regulatory interventions can impact market competition. Several presenters argued, for example, that restrictions on third-party data sharing or cross-platform tracking could entrench large digital platforms that already reap significant advantages from their first-party data.
The upshot: privacy regulation can operate as a competition policy tool by redistributing value between platforms, advertisers, publishers and consumers, and the FTC may adopt new enforcement frameworks in the coming years.
The FTC Appears to Be Building a Record for Future Action
The FTC announced no rulemakings or new enforcement initiatives, but the workshop showed where the agency may be heading. Several panelists broadly called for examining long-term “equilibrium effects” across stakeholders, rather than short-term or platform-specific outcomes. These experts also emphasized the need for robust data to study potential harms like ad fraud, misinformation funding and discriminatory targeting. While that data develops, the FTC seems most concerned with the economic impact of monetized consumer data, with a particular focus on market efficiency and competition.
What Companies Should Watch
For businesses in digital advertising or data analytics, including advertising‑technology intermediaries, the FTC workshop signals what lies ahead:
- Regulators are likely to examine ad targeting and personalization through a more granular, outcomes-based lens.
- Sensitive-use cases, including pricing personalization and targeting members of vulnerable populations, may draw heightened scrutiny.
- Regulatory guidance, enforcement actions, new rules and platform‑level changes to data access or tracking practices may reshape the industry as the FTC seeks to curb anti-competitive outcomes.
- Empirical metrics of competition and efficiency may play a growing role in data privacy protections and enforcement.
As the FTC continues to refine its approach, businesses that proactively evaluate the economic and consumer welfare implications of their data strategies will be better positioned to navigate the evolving regulatory landscape.
