FTC Bucks Advertisers, Supports "Do Not Track" Option for the Web

By Katie Kindelan Comment

The Federal Trade Commission has officially endorsed a “Do Not Track” tool for the Web that would allow consumers to prevent advertisers from collecting their data and tracking their online habits. With the endorsement, the FTC bucked strong advertising forces and placed the burden of privacy protection squarely on the shoulders of marketers, not consumers. Still to be determined is if such a tool can succeed, and if it is what consumers really want and need.

The option, included in the agency’s much-anticipated online privacy report, would be similar to the agency’s “Do Not Call” registry that currently exists to regulate telemarketers. As consumers can block telemarketer calls, Web users would be able to opt-out of being tracked online, eliminating their data from going to third-party sites and advertisers.

Still to be determined is whether “Do Not Track” can become reality.

The FTC’s proposal will likely need Congressional action to move forward, an unknown entity at this point with the upcoming leadership changes in the new Congress. Rep. Bobby Rush (D-Ill.), has introduced an online privacy bill and will hold a hearing on “Do Not Track” this week, but the FTC has yet to take a position on the bill and Rep. Rush will join the minority once Congress returns in January.

More striking will be what moves the advertising industry chooses to make in response to the proposal. The Wall Street Journal just reported Mozilla, the maker of the second-most popular Web browser Firefox, recently dropped plans for a more powerful opt-out tool after inquiries from powerful advertising forces. The ad industry already took a preemptive strike against any FTC or Congressional action by introducing its own, voluntary program earlier this year.

Also of question, for consumers, is if the opt-out option is the best use of FTC resources in protecting consumers.

Amid recent privacy breaches like those of Google Buzz, Facebook and Twitter in which users’ accounts were hacked and private data was released to other users and Web sites, are consumers really the most concerned about whether or not they receive targeted advertising?

And, finally, can a “Do Not Track” mechanism work on the Web? Unlike telephone numbers which do not change frequently, IP addresses can both be shared and change often. It would also likely have little impact on sites like Google that more often use search patterns to target advertising rather than building interest-based profiles.

While “Do Not Track” stole the show, it is just one idea buried in the FTC’s 122-page list of suggestions for how the agency can better regulate websites that act in an “irresponsible or even reckless manner” when handling users’ privacy.

Other suggestions include a more aggressive approach to educating consumers on privacy and requiring companies to build privacy protections into Web browsers and other services.

For now, the suggestions are just that. With few details included, the FTC is opening the plan to public comments through January, and will release a final proposal next year.