For now, the guidelines will probably be voluntary: a sudden
onset of mandatory rules could disrupt marketers, who so far have expressed disagreement
with the FTC’s course of action.
At the root of the problem lies the invasive nature of
behavioral advertising: by assigning websurfers a tracking cookie unique to the
advertising network, marketing firms can track and analyze a user’s activities
whenever he or she enters a site that carries an advertiser’s ads. As such, the
cookie will follow a user around the internet, silently collecting information
on his or her surfing habits in order to serve ever more relevant, targeted advertisements
when the opportunity presents itself: in one example, The Washington Post illustrates how advertisers might find a bride
by looking for people who “read about weddings in the news, entered ‘bridesmaid
dresses’ into a search engine or surfed fashion pages for wedding styles.”
Such tracking has rights groups up in arms over privacy
concerns, who claim that the tracking behind behavioral advertising can build
intimate profiles of users and, consequently, betray a given surfer’s identity.
According to the marketing companies, the only way that
users are linked with past history is through an anonymous, random tracking ID,
which cannot be used to identify an individual.
Further, users have the option of deleting the cookie that
the tracking ID is stored in.
Privacy groups say that marketers’ protections are not enough.
“It is not anonymous if the companies are tracking the same user over time,”
said Center for Democracy and Technology spokesperson Ari Schwartz. An even
bigger concern, says Schwartz, is that advertisers can know what a person is
reading, regardless of whether it’s news stories or fiction stories.
Conceivably, forensic investigators armed with a suspect’s
tracking ID – lifted from his or her cookies, could subpoena a marketing firm for
the suspect’s browsing history, all without a wiretap.
Behavioral advertising is a must in today’s market, say marketers:
online advertising, which grossed $11 billion annually last year, is struggling
to compete with the larger players in the advertising world; television ad
revenues totaled $64 billion in the same time period. Even the owners of some
of the world’s largest advertising-supported websites, including YouTube,
MySpace, and Facebook, “struggled” to make money from internet ads.
Moreso, limiting behavioral advertising could kill free
content on the internet as we know it: webmasters require the highest-paying
ads they can find, but advertisers are only willing to pay more when they know
more about their users. To revert to untargeted advertising would cut
advertisers’ payouts and leave users to rot in a graveyard of annoying,
flashing gimmicks. Television advertisers receive deep insight on their
audience, so why can’t internet advertisers have the same luxury?
The Washington Post
uses the example of a commercial web page that pitches a product, versus a
noncommercial webpage that has “no product to pitch.” In the first case,
advertisers can infer what would be considered good ad placement and what
wouldn’t – but in the second case, unless they have outside information, the
best a marketer can do is place ads blindly, or choose something with a
universal – and therefore low-value – appeal.
“The problem for newspapers is that a story headlined ‘Two
Dead in Baghdad’ isn't very product-friendly,” said Kent Ertugrul, who serves
as the CEO for UK-based Phorm, an advertising network that partners with news
outlets. “But if you know who is looking at the page, that's where the
Despite marketers’ assurances, most users are uneasy with
being tracked: one poll, conducted by Harris Interactive, found that six out of
10 users expressed concern with the level of tracking over the internet.
To remedy the situation, the FTC wants advertisers to give
users a clear warning that they are being tracked, and provide them the option
of opting out of behavioral tracking altogether. “Every Web site,” reads a
draft, should allow surfers to choose “whether or not to have their information
collected for such purpose.”
Newspaper Association of America representative Paul Boyle,
whose members both support and often rely on revenues from behavioral tracking,
sees little worry about. “I really don't know that there is a personal privacy
issue here … the government really needs to let things play out.”
quote: Marketers claim that regulation could bring the end of free content as we know it
quote: online advertising, which grossed $11 billion annually last year, is struggling to compete with the larger players in the advertising world; television ad revenues totaled $64 million in the same time period
quote: Even the owners of some of the world’s largest advertising-supported websites, including YouTube, MySpace, and Facebook, “struggled” to make money from internet ads.