Like the Do Not Call (DNC) list and proposed do-not-mail bills, a new opt-out proposal to the FTC could cause some strife for online marketers.
Earlier this month, a group of nine privacy organizations asked the Federal Trade Commission to provide consumer protections in the behavioral advertising sector.
The nine privacy organizations — which include the Center for Democracy and Technology, Consumer Action, Electronic Frontier Foundation, and World Privacy Forum — have asked the FTC to implement a do-not-track list that would protect consumers from having their online activities unknowingly tracked, stored and used by marketers and advertising networks.
“I think this is an elitist view to assume that consumers do not want to receive advertising,” says Steven K. Berry, EVP, government affairs and corporate responsibility at the Direct Marketing Association. “Consumers are given a number of free services on the Web thanks to advertising support, similar to other broadcast media such as TV and radio. It is wrong to assume that consumers do not want to receive these free services in exchange for advertisements.”
The proposed do-not-track list includes requiring advertisers to add a pop-up, opt-out feature when their behavior is being tracked. The proposal letter also urges the FTC to make information about consumer privacy and choices available to all individuals, including those who have disabilities. AOL has adopted a behavioral opt-out platform through its Tacoda arm.
But, online marketers warn of the potential impact.
“Such a system would undermine a significant and growing portion of the online economy that is behavioral targeting,” says David Daniels, analyst at JupiterResearch. “Many technology companies and increasingly legitimate publishers are using behavioral tracking to increase advertising revenue versus one ad for all.”
According to a JupiterResearch consumer survey, 17% of the online population cited adware as a strong concern that had impacted their use of the Internet in the past 12 months and 15% of the online population stated that they had paid for anti-adware software.
“This indicates that this portion of the population that is rightly concerned with ad tracking and malicious attempts to monitor their behavior are already self-regulating this situation,” Daniels adds. “We continue to find that consumers regularly clear their caches and delete cookies in order to protect their surfing behavior.”
The proposal could also have the potential to block out Web sites as a whole, according to Mike Zaneis, VP of public policy at the Internet Advertising Bureau. “The biggest problem here is that the problem is not defined and the technical aspects of this have not been worked out yet,” he says, noting that sites that could be blocked included e-commerce stores and free news sites.
Daniels says that irresponsible marketers would be able to get around do-not-track more easily than the DNC list.
“The Do Not Call list works particularly because of the friction involved with setting up a phone number,” he says. “While difficult, a malicious advertiser could circumvent such friction by setting up a new IP address.”
The IP-based do not track list would also present a conflict with the FCC mandate requiring digital transmission of TV signals.
“The advertiser/publisher benefit of that FCC mandate is to potentially target the IP address of a set-top box in order to deliver more meaningful and relevant ads and content,” Daniels adds. “The FTC proposal is in conflict with the promise of the FCC plan and would simply raise costs and stifle the innovation of relevance.”
