That's How the Cookie Crumbles


NEW YORK Like much that Google does, the release last week of its new Internet browser, called Chrome, elicited rave reviews and predictable excitement among tech bloggers. Just as predictable was the wariness expressed by some on Madison Avenue.

As with the recently updated version of Microsoft's dominant Internet Explorer, changes in the browser affect the thorny issue of privacy. The reams of data produced by Web users present a dilemma: consumers worry they will be misused while advertisers need them to fulfill the Web's key promise of more targeted and measurable ads. Advertisers are now concerned that Google and Microsoft can use the privacy protection built into their new browsers to control access to this valuable data.

"This is a data-ownership play," said Dave Morgan, a former AOL executive, founder of ad network Tacoda and now chairman of The Tennis Company. "Privacy intermediation for consumers is something that's been talked about for a dozen years."

The immediate concern is that both browsers include a private browsing option, quickly dubbed "porn mode," which blocks cookies. Much of the targeting information used by advertisers and networks remains dependent on the Internet cookie stored on users browsers. Consumers have long been able to block cookies, but the process is less than obvious. Both Microsoft's and Google's browsers will give users much more control over data collection.

Omar Tawakol, CEO of BlueKai, an Internet data exchange, was initially concerned that these options could upend the economics of online advertising. Now, he believes they could be a net benefit for advertising, which has come under fire by privacy groups and faced skeptical questioning by congressional committees about its consumer tracking. Placing control more squarely in users hands will blunt some of the calls for more stringent regulation, he believes. BlueKai plans to compensate users for use of their data and give them access to it.

"I think they're doing it for the right reasons," he said. "Someone has to establish a middle ground [in privacy] and the browser is a fairly smart place to do it."

The sensitivities around privacy and targeting were on display elsewhere last week. Controversial ad targeting firm NebuAd lost its CEO Bob Dykes, and said it would put on hold its plans to deploy "deep-packet inspection" technology that monitors Web behavior through Internet service providers. While browsers would be ideal for collecting many forms of Internet data, Google will need to be careful not to step over an uncertain line, said Ian Schafer, CEO of Deep Focus, an independent digital shop.

"The question is how much goodwill does Google have?" he said. "Google's line is they're providing free utilities to people. But how much privacy or targeting are people willing to accept to have access to free utility?"

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