'Do Not Track' Chosen Among The Worst Proposed Internet Laws In America

Technology trade group NetChoice is taking a stand against proposed 'Do Not Track' legislation that would allow consumers to 'opt out' of targeted online advertising, putting proposals to restrict online advertising at the top of its latest "iAWFUL" list of the top 10 Internet laws.

Technology trade group NetChoice is taking a stand against proposed ‘Do Not Track’ legislation that would allow consumers to ‘opt out’ of targeted online advertising, putting proposals to restrict online advertising at the top of its latest “iAWFUL” list of the top 10 Internet laws.

Targeting “new measures that threaten to undermine the freedom and openness that lie at the core of the Internet’s global appeal,” NetChoice took direct aim at federal and state efforts to make opting out a default measure for online consumers in its first top 10 list of 2011.

Topping the list of what NetChoice deems the most misguided and counterproductive laws is a bill introduced in February by Rep. Jackie Speier (D-Calif.), which would require the Federal Trade Commission to regulate targeted Internet ads.

Speier’s bill would let consumers opt out of having their information used and tracked on the Internet, an idea that NetChoice calls an “unjustified restriction on targeting advertising, which helps pay for free online services and content.”

“If people have a default global opt-out, then how do companies induce people to relax the opt-out?” said Steve DelBianco, executive director of NetChoice. “With a default setting established, it’s extremely difficult to get people to change the default.”

In targeting the legislation as “iAWFUL,” NetChoice, whose members include AOL, eBay, Expedia, Oracle and Yahoo, is taking on a powerful audience of consumers and government agencies hungry for change and tighter online restrictions.

The Federal Trade Commission, the Obama administration and civil liberties groups have all endorsed some type of ‘do not track’ mechanism for the Web. In addition, 67 percent of Americans say they support legislation that would allow them to ‘opt out’ of having their personal data collected and tracked by online advertisers.

The Internet Advocates’ Watchlist for Ugly Laws (iAWFUL) was created by NetChoice in 2009 to identify the top ten pieces of state and federal legislation that pose the greatest threat to the Internet and e-commerce.

The remaining nine items on NetChoice’s iAWFUL list are all state bills, including one in California that would prevent social networks from allowing teens to display their addresses online.

A New York bill would go further than Speier’s bill on ‘do not track’ by requiring websites and online advertising networks to get permission before collecting customer data. The bill would fine websites $250 per violation, potentially leading to multimillion-dollar fines, DelBianco said, which could hurt website customization.

Bills in four states, including Washington and Indiana, would restrict online companies from collecting recurring payments without customer permission each month.

Rounding out the top three are state efforts to apply out-of-state retailers to collect sales taxes from those consumers who are in state.

NetChoice contends the proposals “present all-pain and no-gain to states; they don’t increase revenue and they damage in-state businesses.”

Last year’s iAWFUL list focused on proposals to regulate the data collection and use practices of many Web sites.