The Federal Trade Commission is warning online advertisers to regulate themselves more closely to protect consumers' privacy—or else.
The FTC is charged with balancing advertisers' desire to learn more about their Web site customers—a practice called online behavioral advertising—with customers' privacy rights. Privacy issues are inherent in online behavioral advertising because it focuses on tracking an individual's online activities in order to deliver advertising tailored to his or her interests. Since the takeoff of online shopping in the mid-1990s, the ease with which companies can collect and combine information from consumers online has become controversial.
The FTC report, released Thursday, states that Web sites are expected to provide clear and prominent notice regarding behavioral advertising, as well as an easily accessible way for consumers to choose whether to have their information collected for such purpose. The staff-authored paper continues to promote the self-regulatory idea, stressing the importance of creating and posting privacy policies that are concise and easy to understand, with separate disclosure mechanisms. Companies that collect information through mobile devices or through ISPs should develop distinct and appropriate disclosure methods.
In a statement, Commissioner Pamela Jones Harbour stated her concerns regarding whether self-regulatory programs are the best way to address privacy concerns, noting that evidence is mixed at best. Nearly three years ago, Harbour was the sole FTC dissenter regarding the Google-DoubleClick deal. She said at the time that while she appreciates the "ease and efficiency enabled by a free flow of information I may choose to share certain information about myself to receive commercial benefits, but I appreciate very much the right to make that choice."
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