Behavioral Targeting

Issue
Behavioral targeting provides advertising to Internet users based on Web surfing habits. This ability has enormous benefits to both advertisers and consumers, but has received a fair amount of attention from state and federal legislators because of perceived threats to consumer privacy. Proposed bills in Congress and state legislatures would require that consumers receive notice of behavioral tracking and mandate data deletion and the ability to opt-out of all tracking. Additionally, the Federal Trade Commission has proposed a set of self-regulation guidelines for companies who use behavioral advertising.

AAF Position
The AAF believes the government should show a real or potential harm before adopting regulations concerning behavioral targeting. Proposals designed to limit access to new technology fail to strike an appropriate balance between restrictions on the use of the information and the benefits to consumers through the use of that information. Advertising supports free services provided by Internet content providers. Producers and consumers are best served by advertisements that are relevant and appealing to viewers. All data regulation proposals must differentiate between personal and anonymous data. The AAF has joined with a number of industry groups to submit comments on behavioral advertising guidelines proposed by the Federal Trade Commission, arguing that proposed self-regulatory principles must not limit consumer benefits. The AAF’s comments are available here.

Opposition
Privacy advocates have decried the use of behavioral targeting, insinuating that the data collection required to provide ads tailored to a consumers interest is too intrusive. Some have called on the Congress and the FTC to institute policies requiring Web site operators to collect behavioral data only when a consumer “opts in” to such tracking.

Status
Following a November 2006 workshop on consumer privacy, the Federal Trade Commission said it will not seek new enforcement powers but would continue to enforce consumer protection using existing regulations and by promoting self-regulation.

In a July 2008 hearing, House Energy and Commerce Committee Telecommunications and the Internet Subcommittee Chairman Ed Markey, D-Mass., said he supports having consumers opt-in before Internet service providers can collect behavioral tracking data and called for comprehensive online privacy legislation.

State legislatures have taken interest in regulating behavioral targeting as well.

In New York, Assembly Bill 9275, introduced by Rep. Richard Brodsky, D-Westchester, would penalize Web companies who use personal information about consumers for advertising without their consent.

In Connecticut, House Bill 5765 would require third-party network advertisers to post a notice on its Web site of its data collection and use practices. The AAF opposes both bills, because absent any demonstrable consumer harm or concern with Internet advertising, additional government regulation is unnecessary. We are joining with other industry groups to send letters to representatives in both states.

In Massachusetts, House Bill 4822, the Online Advertising Act, introduced by Rep. William Straus, D-Mattapoisett, would require that companies provide notice of data tracking activity, security of consumers' personal information and deletion of personal information after 24 months.

Last updated: Ocotber 2008

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