July 29, 2010

FTC Mulls “˜Do-Not-Track’ List For Targeted Ads

Federal Trade Commission Chairman Jon Leibowitz told lawmakers on Tuesday that the FTC is considering a do-not-track mechanism that would allow consumers to opt out of all behavioral targeting.

Leibowitz said while testifying at a hearing about online privacy that the FTC is looking into the feasibility of a browser plug-in that would store users' targeting preferences.  He said that either the FTC or a private group could run the system.

Leibowitz said that while Internet users on a no-tracking list would still receive online ads, those ads would not be targeted based on sites that users visited previously.

Center for Digital Democracy and Center for Democracy & Technology, a coalition of privacy groups including the World Privacy Forum, proposed that the FTC create a do-not-track registry three years ago, similar to a do-not-call registry.  The online ad industry strongly opposed the idea of a government-run no-tracking list.

Many people who currently want to opt out do so through cookies, either on a company-by-company basis or through the Network Advertising Initiative's opt-out cookie.  However, those opt-outs are not stable because they are tied to cookies, which often get deleted.

The Network Advertising Initiative rolled out a browser plug-in recently that allows consumers to opt out of targeted ads by NAI members.

Leibowitz said that he personally favored opt-in consent to behavioral targeting, or receiving ads based on sites that have been visited. 

"I think opt-in generally protects consumers' privacy better than opt-out, under most circumstances," he said. "I don't think it undermines a company's ability to get the information it needs to advertise back to consumers."

Senator Clair McCaskill (D-Mo.) said she was "a little spooked out" about online tracking and ad targeting.

She said that after reading online about foreign SUVs, she saw that she was receiving ads for those types of vehicles. 

McCaskill said that if an "average American" were to learn that someone was trailing them around stores with a camera, "there would be hue and cry in this country that would be unprecedented."

Senator Jay Rockefeller (D-W. Va.) and Senator John Kerry (D-Mass.) both expressed concern that privacy policies were not giving Internet users enough useful information about online ad practices.

Rockefeller proposed that some companies were burying too much information by using lengthy documents consumers do not read.

"Some would say the fine print is there and it's not our fault you didn't read it," he said, adding, "I say, that's a 19th-century mentality."

Kerry said that he did not know if consumers understood how companies use data.

"I'm not sure that there's knowledge in the caveat emptor component of this," he said.


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