Posted July 10, 2008 5:36 pm by with 22 comments

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The US Senate is holding a series of hearings on online advertising, behavioral targeting and privacy to determine whether they should consider legislation protecting consumers online in these areas.

The Senate has turned to Google, Microsoft, the FTC, Facebook, privacy watchdogs and others for their opinions in the matter. Some, like Google, welcomed a “comprehensive privacy law that would establish a uniform framework for privacy and procedures to punish bad actors.”

The FTC, on the other hand, believes that the industry could self-regulate: “The commission is cautiously optimistic that the privacy issues raised by online behavioral advertising can be effectively addressed through self-regulation.”

Perhaps most interesting, though, were the senators’ opinions. The New York Times reports:

“We have a solution in search of a problem,” he [Sen Jim DeMint, R-SC] said [in response to the FTC’s proposal], noting that Internet companies are developing various ways to protect the privacy of users. “By the time the F.T.C. acts, the industry would be far ahead,” he said.

One legislative question largely unaddressed was whether Congress should set standards for how Internet service providers monitor the actions of their users to create information for advertising. [CEO of the Center for Democracy and Technology, Leslie] Harris alone called for such a law.

Senator Byron Dorgan, the Democrat of North Dakota who chaired the hearing, said he had invited representatives of Internet providers to discuss the issue and they declined. So he said he would schedule another hearing entirely devoted to hearing from the I.S.P.s about their advertising plans.

I think Dorgan’s right—ISPs seem to be a bigger issue lately. Because while Google, Facebook and their ilk have collected substantial data on us, it’s almost always been because we volunteered it to them, registered with them, etc. But does owning the “pipe” give an ISP the right to observe what you’re doing and change content based on that activity?

The Senate plans to continue investigating throughout the year. I guess this just goes to show you—not everyone in Congress would describe the Internet as “a series of pipes” 😉 .

What do you think? Should the Senate pass a law in this area, or will the FTC and the industry step up? And where do ISPs fall in here?

(Link to the full text of the hearings via SEL.)

  • Was it a “series of pipes” or a “series of tubes?” Nonetheless, no ISPs shouldn’t have the right to spy on the data flowing through their “pipes” or “tubes”.

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  • Yawn… Here we go again, strapping on the tin foil hats over the horrific practice of actually showing ads for things that people… gasp!… would actually have interest in. I for one will welcome the day when my TV, computer and radio et al will finally get that I don’t give 2 sharts about tampons, geritol and Tammy Wynette CDs.

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  • The more creative the better. Although bothersome, there is something to be said about the genius behind getting everyone with an email address to see their spam.

  • Targeting of ads is cool, but when user data is made available to third parties things start getting grey…

  • I agree with Utah…NO SPYING!

  • Utah, I agree you, too.

  • WD

    I still think the true power in targeted advertising will be cenetered around the ISP (unless laws prevent it). We know they sniff the data in their traffic. e.g., how they detect bit-torrent traffic. They surely have even more data available as to all the sites you visit (look at reporting for OpenDNS and it’ll give you an idea of whats available just via DNS server), maybe what you search for across all the search engines (not limited to one).

    Now add to the above that they know your real contact information (address, ssn, etc). Can probably even decipher from the above data the composition of your household (adults, teenage girl, teenage boy, etc.).

    Now they combine all this online data with offline data – think ChoicePoint and similar companies. Some companies outsource their HR reporting too, so it’s possible for an aggregator to actually have real salary info. They can now provide a more complete picture of your ‘life’ to advertisers. What you bought with that store discount card, is tied to where you shopped online, and what you googled, and your new credit card, and all with accurate demographic data.

    I think just considering what may be possible is reason enough to be concerned with the likes of NebuAd and Phorm. It even is reason to consider the discussion this week for encrypting your entire online usage (not just so you can pirate movies).

    (takes tin foil hat off)

  • Jordan McCollum

    Whoa whoa whoa. Why did you give your ISP your SSN? No ISP I’ve had has ever required that and by law you are not required to give it to them. It’s not like they have to do a credit check.

  • They are already developing face recognition with offline ads. The world is turning into one huge big brother house. Unless we do something about it.

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  • I actually just got done re-reading 1984 and advertising has ZERO to do with the concept of Big Brother. If anything, capitalism, commerce and advertising are the antithesis of “Big Brother”, but that is all beside the point.

    I would expect an audience that is involved in marketing to some point would get that this targeting is still in effect “anonymous”. If anything, demographic and interest related targeting will alleviate any need and desire for advertising to care about your specific personal identity. The only reason direct mail needs to know EXACTLY who you are is the delivery method. If the delivery method can be simplified to “people with interest X” instead of “person X, Y, Z…” then marketers’ jobs and lives would be improved. As a market I really don’t have any desire to wade through endless details of specific persons. That’s really all just noise that delays my true goal, to find whole groups of people with specific interests, namely interest in my product. Targeting in actuality makes the specifics of an individual unnecessary to be seen, no one is aiming to sell something to Bob Smith, they aim to sell something to EVERYONE who has the same need as Bob Smith.

    As to facial recognition technology for outdoor advertising… uh, yeah… maybe that will come online about the same time as my personal jet car and personal robot house made. Put down the L. Ron Hubbard and go reread 1984 so you gain the proper literary perspective you are seeking.

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  • WD

    @Jordan: I don’t recall giving them my SSN. However, on my last service call they asked for the last 4 digits to verify who I was. So, I can assume they have it. As far as being ‘by law’, I went through the same thing with a dentist. It’s a matter of doing business with them or not. I chose another dentist, however, if it came down to giving up the SSN for broadband or a 56K dial-up I’m sure I’d eventually cave-in.

    Also, something else I thought of after posting is that HitWise is an Experian company (the credit bureau company, though a lot else now too). I wonder how much of this is already being done.

  • I cant see how ISP can use this data. They cannot alter the pages i see, so where should they put the ads?

  • Expecting an industry to self-regulate has never proved to be a good idea.

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  • Utah, I think you are spot on with what you say my friend.

  • Its not even a thought that our privacy should be protected.

  • Face recognition, are you kidding me? Next thing you know we’ll all have thumb print scanners next to our keyboards.

  • Yes, and then they will implant RFID devices in our cortexes and mind reading telepathic dolphins will control our minds and force us to buy Colgate. Get a grip people, they just are trying to avoid wasting ad dollars marketing Medigap coverage to people under 60.

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  • ISPs have no business messing with information we give to other companies to be used for advertising. As far as I’m concerned, I pay enough to ISP’s without them using me for revenue for other parties.

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  • I dont have much problem with using this data for marketing purposes. Finally i can get ads that are interesting for me personally. And marketers can save a lot of money. Being a marketer myself i would like to have this opportunity.

  • If ISP are allowed to regulate traffic the internet will completely change. 60% of the content is created by individuals, at this point. This will completely change to where all the traffic will just flow to the highest bidders. Really the ISPs could block anyone if the are truly given “control.”

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  • The personal data must not be given to third parties. Its a breach of trust.

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