Happy New Year?

August 1, 2019

Californians celebrate the transition from one year to the next in unique and fun ways. For example, on New Year’s Eve in Orange County, an orange ball is dropped; South Lake Tahoe lowers a gondola to celebrate; and Temecula Valley, in wine country, drops a bunch of grapes!

But when January 1, 2020 rolls around, not all advertisers will be celebrating and saying, “HAPPY New Year!”  Unless substantial changes are made, those impacted by the California Consumer Privacy Act (CCPA) will find 2020 a quite unhappy and challenging time.

The new law is, by far, the most sweeping privacy statute ever enacted in the United States.  And many companies are not even aware that they will be covered by the law, or – if they are covered – how they can begin to comply with it. So, let’s consider the CCPA’s reach.

Who’s covered?

The CCPA covers any company doing business in California with (1) $25M or more in gross receipts; or (2) has 50K or more pieces of personal information; or (3) receives half of its earnings from selling data.  That’s a lot of companies – a whopping estimated 550,000 entities -- starting on 1/1/20.

What’s covered?

And what kinds of activities are covered?  Think loyalty and reward programs; artificial intelligence; social media use; behavioral advertising; measuring marketing return on investment; and use of Internet of Things information.  All of these (and more) data uses are subject to the CCPA.  LOTS of previously unregulated data activities will be implicated in the CCPA’s new requirements.

Shifting coverage?

In addition to the law’s vast expanse, companies trying to prepare to comply with the CCPA are facing significant difficulties, since the California Legislature continues to change the law and California’s Attorney General is conducting a mandated rulemaking proceeding to clarify various CCPA requirements.  The CCPA’s obligations are still a fast-moving target for advertisers, but that reality won’t delay the inevitable application of the law once 2020 arrives in just five short months.

In the coming days, I’ll be writing regularly to point out various aspects of the CCPA and its advertising impacts. You can already find information on our website about the law. For now, the first key question is about what’s in and what’s out.  Companies should figure out if the CCPA applies to them, and if so, quickly start to put together a plan to satisfy the CCPA’s demands in order to avoid being penalized for noncompliance.

Those oranges, gondolas and grapes will be dropping before we know it!


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