The leading trade associations in the online advertising industry have just released their new self-regulatory principles—the first comprehensive self-regulatory principles industry has produced, which track closely with the suggested guidelines released by the FTC in February.
I commend the industry for setting a new standard in transparency, consumer control and data security. These Principles do much to empower Americans to make their own decisions about privacy, but I fear that many critics of so-called “targeted advertising” will
never be satisfied, no matter how high industry raises the bar.
These critics have insisted that ordinary users can’t be trusted to make the “right decisions” about privacy and have insisted on imposing restrictive default “opt-in” rules for the online data collection that makes online advertising valuable to websites that rely on ad revenue. Such pre-emptive privacy regulation would stunt the growth of revenue for the “Free” online content and services we’ve all come to take for granted. During a time of economic recession, and as traditional media like newspapers struggle to make the transition from print to the Internet, it’s more important than ever that policymakers allow self-regulation to evolve. Only by doing so can we expect continued innovation and creativity online. We must all remember: There is no free lunch!
I’ll lead a panel discussion on July 10 on Capitol Hill about “Regulating Online Advertising: What Will it Mean for Consumers, Culture & Journalism?” Please RSVP here.
by Berin Szoka & Adam Thierer
This morning, the House Energy & Commerce Committee will hold a hearing on “Behavioral Advertising: Industry Practices And Consumers’ Expectations.” If nothing else, it promises to be quite entertaining: With full-time Google bashers Jeff Chester and Scott Cleland on the agenda, the likelihood that top Google officials will be burned in effigy appears high!
Chester, self-appointed spokesman for what one might call the People for the Ethical Treatment of Data (PETD) movement, is sure to rant and rave about the impending techno-apocalypse that will, like all his other Chicken-Little scenarios, befall us all if online advertisers were permitted to better tailor ads to consumers’ liking. After all, can you imagine the nightmare of less annoying ads that might actually convey more useful information to consumers? Isn’t serving up “untargeted” dumb banner ads for Viagra to young women and Victoria’s Secret ads to Catholic school kids the pinnacle of modern online advertising? Gods forbid we actually make advertising more relevant and interest-based! (Those Catholic school boys may appreciate the lingerie ads, but few will likely buy bras.)
Anyway, according to National Journal’s Tech Daily Dose, the hearing lineup also includes:
- Charles Curran, Executive Director, Network Advertising Initiative
- Christopher Kelly, Chief Privacy Officer, Facebook
- Edward Felten, Director, Center for IT Policy, Princeton University
- Anne Toth, Chief Privacy Officer & Vice President, Policy, Yahoo!
- Nicole Wong, Deputy General Counsel, Google
That’s an interesting group and we’re sure that they will say interesting things about the issue. Nonetheless, because four of them have a corporate affiliation that fact will inevitably be used by some critics to dismiss what they have to say about the sensibility of more targeted or interest-based forms of online advertising. So, we’d like to offer a few thoughts and pose a few questions to make sure that Committee members understand why, regardless of what it means for any particular online operator,
targeting online advertising is very pro-consumer and essential to the future of online content, culture, and competition. As Wall Street Journal technology columnist Walt Mossberg has noted, “Advertising is the mother’s milk of all the mass media.” Much of the “free speech” we all cherish isn’t really free, but ad-supported!
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I’ve already laid out my own reactions to Google’s roll-out of an “interest based advertising” (IBA) program here. In a nutshell, I applauded Google setting a new “gold standard” in user empowerment by providing:
- Notice in their IBA-targeted ads of who’s paying for the ad and the fact that Google is serving it; and
- A link to a powerful “Ad Preference Manager” that allows users to:
- See and modify the “digital dossier” (to use the fearmonger’s term) of interests associated with the cookie on their computer; and
- Opt-out of tracking for IBA purposes.
But as I predicted, despite these pro-privacy features (and despite the fact that other major companies such as Yahoo! and Microsoft already have IBA programs), a number of privacy advocacy organizations are attacking Google for daring to enter the IBA (or “online behavioral advertising”) business at all. I’ll have much more to say about the criticism of Google’s new Ad Preference Manager soon, especially coming from Marc Rotenberg of EPIC (a “disaster“) and Jeff Chester of CDD—precisely the sort of the “paroxysms of privacy hysteria” I predicted.
But first, the criticism from Ari Schwartz of the Center for Democracy & Technology requires a response today. At its best, CDT plays a vital role in calling corporations to continually raise the bar on privacy. My own think tank, the Progress & Freedom Foundation, works closely with CDT on many issues, such as advocating user empowerment through technological means as a constitutionally “less restrictive” way of protecting children than government censorship.
Here’s what Ari had to say: Continue reading →
Google’s new “Interest Based Advertising” (IBA) program represents the company’s first foray into what is generally called “Online Behavioral Advertising” (OBA): In order to deliver more relevant advertising, Google will begin tailoring ads delivered through AdSense on the Google Content Network (GCN) and YouTube.com (but not Google.com). This tailoring will be based on a profile of each user’s interests created by tracking their browsing activity across sites that use AdSense-but not search queries or other user information. Until now, (i) AdSense has delivered essentially “contextual” advertising by choosing which ad to display on a page based on an algorithmic analysis of keywords on that page; and (ii) Google has tracked users’ browsing only for analytics purposes-to limit the number of times a user sees a particular ad (to prevent overexposure) and to allow sequencing of ads in campaigns where one ad must follow another.
Google is sure to be attacked for crossing a “line in the sand” drawn by some privacy advocates between contextual and behavioral advertising-even though Google’s closest competitor, Yahoo!, already offers a similar program, and the concept in general is hardly new. Google’s position as the leading search engine and third party ad-delivery network will no doubt cause paroxysms of privacy hysteria among those who consider targeted advertising inherently invasive, unfair or manipulative.
But those whose first priority is advancing consumer privacy, not advancing a political or regulatory agenda, should applaud Google for excluding sensitive categories and for putting the new Ad Preference Manager at the core of the company’s new IBA program. The Ad Preference Manager sets a new “gold standard” for implementing the principles of Notice and Choice, which have formed the core of both OBA industry self-regulation and the various regulatory proposals made in recent years. Indeed, Google has done precisely what Adam Thierer and I have called for: giving consumers more granular control over their own privacy preferences by developing better tools.
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The Technology Liberation Front is the tech policy blog dedicated to keeping politicians' hands off the 'net and everything else related to technology.