Observed Signal · Jan 20, 2023 · Regulation · Source: OnlineMarketing.de · Impact: 3/5 · Sentiment: Negative
EU Warns TikTok to Meet DSA Rules
EU figures tighten enforcement of the Digital Services Act (DSA) ahead of a September 2023 deadline, warning that TikTok could face a suspension if it fails to comply. The EU Commission, led by Thierry Breton, warned against rapid access to harmful content and concerns about data use for political or economic ends, calling out 'wolves in sheep's clothing' among platforms. An advisor told Bloomberg that TikTok is to be among the first platforms examined under the new rules. In response, TikTok's spokesperson Caroline Greer reiterated the company's commitment to the DSA. The article also notes a new TikTok option allowing messages from all users, a change not expected to bolster safety but part of ongoing platform updates. The piece frames the DSA as a pivotal regulatory hurdle for TikTok in the EU, with potential sanctions if compliance is lacking.
Regulatory risk to TikTok in the EU under the Digital Services Act; potential ban if non-compliant.
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Key Takeaways & Evidence Grounding
- EU Commission tightens stance on Digital Services Act ahead of the September 2023 deadline.
- TikTok could face suspension if it does not comply with DSA rules.
- Thierry Breton warned of 'wolves in sheep's clothing' among platforms and cited concerns over harmful content and data use for political/economic ends.
- Bloomberg cited a advisor saying TikTok will be among the first platforms tested under the new rules.
- TikTok introduced a new option to receive messages from all other users.
Connected Companies & Entities
2 Entities mappedRelated Market Signals & Shifts
Recent verified developments and strategic activity across this market segment.
EU deems TikTok design unlawful under DSA
The European Commission issued a preliminary finding that TikTok's app design—endless scrolling, autoplay, and reward-driven engagement loops—may breach the Digital Services Act (DSA). The assessment is not final; TikTok can respond and appeal as regulators consult with the European Board for Digital Services. If confirmed, the ruling could force changes to reduce addiction-like features and bolster safeguards for minors, potentially leading to penalties of up to 6% of global annual turnover. The Commission notes that risk signals such as late-night usage by minors and frequent app openings were not adequately addressed in the risk assessment. Industry-wide implications are in play, as the case could establish a precedent for platform design across the EU. The World Advertising Research Centre estimates TikTok's revenue around $35 billion this year, underscoring the potential impact of enforcement. TikTok denies the findings and says it will contest the assessment.
OK Future's AI 'Pressure Cooker' Campaign for Goodwipes
Former MullenLowe U.S. CEO Frank Cartagena launched creative shop OK Future to test generative AI's potential for a small agency. Their first project, a spoof of OpenAI's Astra ad for personal hygiene brand Goodwipes, was produced in four days using AI tools like ArtCraft, Seedance, and OpenAI's Astra model, cutting projected production costs from $700,000. The campaign, 'Meet Asstra,' gained over 1.5 million views on Reddit. However, Cartagena described the pace as 'unsustainable' and a 'pressure cooker,' with team members working around the clock and even threatening to quit. Goodwipes' SVP of Marketing, Meredith Diehn, emphasized trust in Cartagena and the value of experimenting with AI. The article highlights the growing use of AI in creative production, with 73% of marketers using GenAI for visual content and Gartner forecasting AI software spending to reach $981 billion by 2029.
Lo-fi UGC-style content outperforms polished ads
The article discusses the growing effectiveness of lo-fi and UGC-style content over polished brand advertisements in social feeds. Citing data from TikTok, System1, Meta, and Kantar, it reports that creator-led content achieves 70% higher click-through rates and 159% higher engagement than non-creator ads at the same CPM, and that viewers skip influencer content after 17.8 seconds compared to 7.9 seconds for traditional branded content. Meta partnership ads reportedly deliver 19% lower CPAs and 13% higher click-through rates. The article emphasizes that while lo-fi content feels authentic, it still requires deliberate strategy, including clear brand cues within the first two seconds. It advises brands to combine lo-fi production, genuine UGC/creator content, and a remix layer of existing footage to maintain creative freshness and performance on platforms like TikTok and Instagram Reels.
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