Data brokers ramp up lobbying efforts, spending $143 million over three years

Companies that collect and deal in people’s personal information — data brokers and their parent companies — have been quietly increasing their lobbying spending for years. In 2020, these companies collectively spent enough on lobbying to rival tech giants like Google or Facebook.¹ 2022 saw a surge in spending as the US moved closer than ever to having data privacy protections enshrined in federal law.²

Data brokers generate revenue by collecting, aggregating, and ultimately selling ordinary Americans’ personal information. Federal legislation protecting residents’ data privacy rights, in the style of California’s CCPA or the EU’s GDPR, would throw a spanner in the works of data brokers’ profit engines.

The concern is that, as privacy advocates and legislators work towards securing people’s rights to be left alone and forgotten, data brokers are ramping up their lobbying efforts to block or at least water down such legislation. A potential win for this $260 billion industry³, but a huge loss for everyday Americans.

Incogni’s researchers analyzed lobbying disclosure reports related to registered data brokers and the companies that own them. The study focuses on lobbying efforts aimed at both houses of the US Congress: the House of Representatives and the Senate.

Key findings

• 140 companies lobbied on behalf of 40 data brokers or broker-owning companies (an average of 3.5 lobbyists per broker or broker-owning company);
• The amount of money that data brokers spent on lobbying has increased from $37.5 million in 2020 to $49.6 million in 2021 and $56.1 million in 2022;
• Just five of these companies are responsible for $86.1 million of the $143.2 million spent on lobbying (that’s 12.5% of observed companies accounting for 60.1% of the recorded total);
• Data broker owner Oracle Corporation spent over $42.1 million on lobbying, accounting for 29.4% of all recorded spending;
• Terms related to data privacy were mentioned in 296 out of 1,225 reports (24.18%).

Who’s doing the lobbying, and on whose behalf?

Incogni’s researchers uncovered 140 entities lobbying on behalf of 40 data brokers and broker-owners between 2020 and 2022.

During the studied period, the number of lobbying data brokers increased steadily, and so did the average number of lobbyists hired per data broker. The increase in the average number of lobbyists per data broker (or broker-owning company) may indicate that these companies are broadening their lobbying interests, engaging more lobbyists to cover more sectors, states, and politicians.

The amount spent on lobbying increased year-on-year over the studied period

On a yearly basis, the total spend on lobbying by data brokers and broker-owners saw consistent gains between 2020 and 2022:

• Yearly spending increased by 32% from 2020 to 2021 and 13% from 2021 to 2022; 
• In 2022 alone, data brokers spent a staggering $56 million on lobbying; 
• A total of $143.2 million were spent by data brokers on lobbying throughout the three-year period.

Looking at quarterly data, the highest quarterly amount spent was seen in the third quarter of 2022, with a spending of $16.6 million. This spike in data broker spending may be related to the American Data Privacy and Protection Act⁴ coming before Congress in June 2022. The Act represents an obvious hindrance to the data broker industry as a whole, and it would make sense that data brokers would turn to lobbyists to prevent any such developments.

Which data brokers and broker-owners are the biggest lobbying spenders?

One company stands out in terms of total lobbying spend. Data broker-owner Oracle Corporation spent over $42.1 million on lobbying, accounting for 29.4% of all recorded spending. Accenture came in a distant second, having spent over $11.8 million — almost four times less than Oracle.

Among the top five spending companies, only Accenture is a registered data broker. The remaining spenders are broker-owning companies. RELX owns three data brokers, while the remaining companies own one each. 

Furthermore, the 8th and 10th highest spending companies are Equifax and TransUnion, which own eight and nine brokers, respectively. Other notable companies that lobbied the US government include Moody’s Corporation, which owns a total of four data brokers and spent a total of $2 million, and Epsilon which owns two data brokers and has thus far only spent $80 thousand. 

The dataset also includes instances in which both the data broker and its parent company lobbied the government. For example, the third-biggest spender, RELX, which itself spent $11.29 million, was accompanied by its subsidiary, Accuity, which spent $520 thousand during the analyzed period. Similarly, TransUnion (itself not a data broker) and two of its data broker subsidiaries (Trans Union and Neustar) lobbied for over $5.6 million. 

What issues do these lobbyists claim to support?

There’s no way to get a clear picture of the issues being championed by the lobbyists in this study. That is because the only data researchers have to go on are clusters of general issue codes and brief, specific issue descriptions. A single lobbying disclosure report can contain references to several disparate issues.

General issue codes are three-letter codes used to indicate the area of civil, political, and social interest that the given lobbying efforts are addressing. These broad codes cover areas such as DEF for defense, POS for postal matters, and CSP for consumer issues/safety/protection.

Five codes were mentioned over 200 times: 

• FIN (Financial institutions, investments, and securities) — mentioned a total of 342 times and appeared in 27.94% of all reports;
• BUD (Budget and appropriations) — used 272 times and appeared in 22.22% of reports;
• TAX (Taxation and internal revenue code) — mentioned 226 times in 18.46% of reports;
• CPI (Computer Industry) — 219 mentions in 17.89% of reports; 
• DEF (Defense) — 215 mentions in 17.57% of reports.

CSP (Consumer issues, safety, and protection), a code expected to be lobbied for the most, was cited in a total of 158 (12.91% of all) analyzed reports, making it only the 8th most frequently mentioned issue.

How much money do lobbyists spend on specific issues?

While the data does not reveal the amount of money spent on each issue, researchers were able to calculate how much money was spent in reports where each issue appeared.

• FIN (Financial institutions, investments, and securities) was mentioned in reports where the reported spending added up to $62.7 million dollars;
• TAX (Taxation and internal revenue code) was mentioned over 100 times less often than FIN but was seen in reports where spending added up to $61.6 million; 
• BUD (Budget and appropriations), GOV (government issues), and DEF (defense) comprised the rest of the top 5 issues by amount spent; 
• Only $43 million were spent on reports that mentioned CSP — Consumer issues, safety, and protection. This highlights the variety of sectors relevant to data brokers.

One in four lobbying reports referred directly to privacy issues

Other than a set of these general, three-letter issue codes, lobbyists can also include a brief issue description in their lobbying disclosure reports. Usually only a couple of sentences in length, these descriptions are, unlike the general codes, not standardized: each lobbyist writes their own.

Incogni’s researchers analyzed the frequency of keywords and phrases in these descriptions. In total, 296 (24.18% of all) reports included at least one privacy-related term:

• The term “data privacy” was mentioned in 142 (10.83% of all) reports;
• Other similar terms were also prominent, with “privacy issues,” “data security,” and “consumer data” being noted a total of 72, 88, and 50 times respectively.

Based on the interests and priorities of their clients, it’s unlikely that these data broker lobbyists were advocating for greater data privacy or security. Rather, their lobbying efforts were likely focused on limiting Americans’ right to data privacy, as this aligns with the interests of their clients who rely on the availability of personal data to conduct their business.

Other notable terms found in the reports include “national defense” (found in 131 or 9.99% of all reports), “issues related to cybersecurity” (53 reports, 4.04%), and “credit reporting” (78 reports).

The top five spenders on lobbying and the issues that were mentioned

Among the top five spenders, some general issue codes appeared more frequently than others:

• BUD (Budget and appropriations) and DEF (Defense) were cited the most frequently, and both received 146 mentions each by the top five spenders — over half of which were from the Oracle Corporation; 
• If Oracle’s use of general issues is to be excluded, BAN (Banking; mentioned 84 times) and TAX (Taxation and internal revenue code; mentioned 85 times) become the most frequently cited issues;
• Oracle Corporation cited the highest number of issues, but Accenture had the highest variety of issues mentioned.

As for the use of specific issue descriptions among the top five spenders, several specific keywords stood out:

• National defense was mentioned by all five top lobbyists and is the only term that received interest from each of the top spenders;
• Privacy issues was the second most frequently mentioned term, mentioned by three of the top five companies; 
• Consumer data, data security, issues related to cybersecurity, and data privacy are other frequent terms found in lobbying reports by the top spenders.

Data brokers and lobbying — future outlook

The data broker industry is evolving rapidly, but so are data protection regulations. This has led to a surge in data brokers’ lobbying efforts to protect their interests and build their influence over lawmakers and regulators. As a result, significant amounts of money are being invested in lobbying, and we can expect this trend to continue into the future.

Methodology

Incogni’s researchers analyzed the US Senate lobbying efforts of data brokers registered in California and Vermont as well as those of their parent companies.

To identify lobbying by or on behalf of data brokers (and their owners, as found in Incogni’s earlier research), we checked whether they were listed as clients in the Senate filings database LD-2 reports. These reports were downloaded on March 17, 2023. 

Researchers then identified the time frames for which each data broker was officially registered in California or Vermont. This was done to ensure that lobbying reports covering entities that were not officially data brokers were not considered. In total, this study analyzed 1,224 LD-02 reports.

Incogni’s research team analyzed the finalized dataset based on: the time periods covered by the reports; the sums of money spent on lobbying activities; the general issue codes listed; the specific issues named; and the names of the lobbyists and their clients (the brokers and their parent companies).

Notes on the analysis: 

• For broker-owning companies, only reports filed in periods during which the company had officially registered data brokers as subsidiaries were considered;
• The methodology accounts for registration dates from the earliest available date to the latest available date. This means that if a company was not officially registered as a broker for a period in between, their lobbying reports are still used in the analysis.  

Notes on the data:

• Some reports were amendments that replaced regular reports — in such cases, only the amendments and not the original reports were considered;
• The list of data brokers registered in California (originally collected on 2023-03-07) was supplemented by an earlier snapshot of the same registry (collected on 2022-12-28). This was because the older version included several dates of broker registrations that were absent from the new list. 

The full research materials behind the study are available here.

Limitations

Incogni’s research team was unable to query lobbying filings for two data brokers: Deep Root Analytics and Grassroots Analytics. Querying these brokers resulted in an “access denied” page, likely due to penetration prevention measures.

The terms (as found in specific issues) investigated in this research were selected by our researchers, meaning that other potentially meaningful terms could have been missed.

Sources

1. Ng, Alfred and Maddy Varner. “The Little-Known Data Broker Industry Is Spending Big Bucks Lobbying Congress.” The Markup. Last modified April 1, 2021. https://themarkup.org/privacy/2021/04/01/the-little-known-data-broker-industry-is-spending-big-bucks-lobbying-congress.
2. Ng, Alfred. “Privacy Bill Triggers Lobbying Surge by Data Brokers.” Politico. Last modified August 8, 2022. https://www.politico.com/news/2022/08/28/privacy-bill-triggers-lobbying-surge-by-data-brokers-00052958.
3. Maximize Market Research. “Data Broker Market: Global Industry Forecast (2022-2029) by Data Category, Data Type, Pricing Model, End Use Sector, and Region.” Last modified August, 2022. https://www.maximizemarketresearch.com/market-report/global-data-broker-market/55670/
4. United States Congress. “American Data Privacy and Protection Act.” Accessed May 9, 2023. https://www.congress.gov/bill/117th-congress/house-bill/8152/text
5. United States Senate. “Lobbying Disclosure.” Accessed April 25, 2023. https://lda.senate.gov/filings/public/filing/search/. 
6. Incogni. “Who owns your data? Top 6 companies buying up data brokers.” Accessed April 25, 2023. https://blog.incogni.com/california-companies-buying-up-data-brokers/.
7. Office of the Clerk, US House of Representatives. “Lobbying Disclosure Act.” Accessed April 13, 2023. https://lobbyingdisclosure.house.gov/lda.html.
8. United States Congress. “Lobbying Issue Codes.” Accessed April 13, 2023. https://lda.congress.gov/ld/help/default.htm?turl=Documents%2FAppCodes.htm.