Groups Decry Web ‘Privacy Threats’

Not everyone is as excited as advertisers and agencies about “real-time” ad delivery.

In fact, the notion of targeting individual Web users in mliseconds, based on their recent Web surfing habits, has some advocacy groups alarmed.

Three such organizations today filed a complaint with the Federal Trade Commission. Those groups — the U.S. Public Interest Research Group, the Center for Digital Democracy and the World Privacy Forum — urged the FTC to investigate “privacy threats” generated by “real-time” behavioral targeting.

The groups specifically called out the practices of Google and Yahoo, as well as yield-optimization upstarts PubMatic and the Rubicon Project, data exchange firm eXelate and bidding technology company MediaMath.

In a 32-page document filed to the FTC, the groups contend that consumers are largely in the dark about how sophisticated behavioral ad targeting has become, and how information gathered based on users’ Web habits is blended with data from their real-world activities.

“Consumers will be most shocked to learn that companies are instantaneously combining the details of their online lives with information from previously unconnected offline databases without their knowledge, let alone consent,” said Ed Mierzwinski, U.S. PIRG consumer program director. “In just the last few years, a growing and barely regulated network of sellers and marketers has gained massive information advantages over consumers.”

The report goes so far as to claim that Web users are being denied the ability to “reap the financial benefits of their own data” — implying, perhaps, that consumers should be paid for sharing details of their Internet habits and preferences with advertisers.
Of course, the online advertising industry is keenly aware that scrutiny by the federal government is on the rise. Lawmakers are expected to introduce a bill in the coming weeks aimed at providing consumer privacy guidelines for both publishers and advertisers. And many expect the FTC to start playing a more active role in policing the space.

But it remains to be seen how much power and influence advocacy groups will have over the FTC, which is also working directly with top industry organizations like the Interactive Advertising Bureau to address privacy issues.

That didn’t stop CDD executive director Jeff Chester from charging the FTC with being outright negligent.

“FTC inaction has encouraged the data collection and ad targeting industry to expand the use of consumer information for personalized advertising,” he said. “The commission’s failure to adequately protect the privacy of consumer transactions online, including those that involve financial and other sensitive information, is irresponsible. U.S. consumers, especially during this time of economic hardship for so many, need a commission that is proactive in protecting their interests.”

Publish date: April 8, 2010 © 2020 Adweek, LLC. - All Rights Reserved and NOT FOR REPRINT