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“The fate of Criteo brings together the paradoxes that emerge with the passage of the Internet to adulthood”

At Criteo headquarters in Paris in October 2019. ERIC PIERMONT / AFP

Losses & profits. Jean-Baptiste Rudelle, the president-founder of Criteo, is a big fan of kitesurfing. He even founded an association, The Galion Project, which brings together start-upers to reflect together on the future of the world and indulge between two meetings in the pleasures of this sport. He will need all his science of balance in motion, and the advice of his comrades “Hyper growth entrepreneurs” to ward off the bad luck going on his business.

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There is not much hypergrowth at Criteo. The company's revenue fell 2% in 2019 and could fall 10% this year, according to its own expectations. Specializing in the optimization of advertisements on websites, the company is one of the most beautiful French digital start-ups. Created in 2005, it has a turnover of more than 2 billion euros and its IPO in 2013 made it one of the first French unicorns, valued at more than 1 billion euros. It is now worth half of it, while the National Commission for Data Protection has just opened an investigation into its practices.

Necessary regulation

His destiny brings together the contradictions and paradoxes that emerge with the transition to the adulthood of the Internet world. The company was at the origin of the industrialization of advertising on the Net thanks to its targeting software, cookies, which track Internet users' habits to send them advertisements adapted to their recent searches.

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This practice is effective, but more and more visible and less and less accepted. The European General Data Protection Regulation requires the consent of the Internet user, and recent scandals have made the subject very sensitive. This is why the browsers Firefox and Safari (Apple) have prohibited “third-party” cookies, such as those installed by Criteo on behalf of its customers. Then, in January, it’s Google’s turn to announce that it’s removing its Chrome browser, used by two-thirds of internet users, within two years. Suddenly, the entire economic model of this sector, and in particular of Criteo, is to be reviewed.

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Behind this necessary regulation, however, hide two paradoxes. On the one hand, as in taxation, the first targeted by these rules, the ubiquitous Google, Apple, Facebook and Amazon, accused of being too powerful and indiscreet, will be the first beneficiaries of these measures. They will weaken the players who share the 25% of the advertising market that is not yet in the hands of Google or Facebook.

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