NY State strikes out against unapproved privacy invasion by online advertisers

Kudos to Assemblyman Richard L. Brodsky in the NY State Assembly for taking on GoogleClick and the rest of the back-end invisible online tracking services.

The NYT reports A Push to Limit the Tracking of Web Surfers’ Clicks:

AFTER reading about how Internet companies like Google, Microsoft and Yahoo collect information about people online and use it for targeted advertising, one New York assemblyman said there ought to be a law.


Michelle V. Agins/The New York Times

Assemblyman Richard L. Brodsky, the sponsor of a New York bill to limit how companies collect data on computer users.

So he drafted a bill, now gathering support in Albany, that would make it a crime — punishable by a fine to be determined — for certain Web companies to use personal information about consumers for advertising without their consent.

And because it would be extraordinarily difficult for the companies that collect such data to adhere to stricter rules for people in New York alone, these companies would probably have to adjust their rules everywhere, effectively turning the New York legislation into national law.

“Should these companies be able to sell or use what’s essentially private data without permission? The easy answer is absolutely not,” said the assemblyman who sponsored the bill, Richard L. Brodsky, a Democrat who has represented part of Westchester County since 1982.

“A law like this essentially takes some of the gold away from marketers,” said Joseph Turow, a professor at the Annenberg School for Communication at the University of Pennsylvania. “But it’s the right thing to do. Consumers have no idea how much information is being collected about them, and the advertising industry should have to deal with that.”

This is an absolute no brainer.

If you don’t have permission, don’t track users.

In the physical world, we have developed fairly robust rules of social etiquette and even laws regulating this sort of behavior. Can you imagine how creepy it would be if some stranger surreptitiously followed you around, noting where you go, what products you buy, even what sections in the supermarket you lingered in? Yech! Get that stalker away from me.

new carAnd yet, that is exactly what most (if not all) online ad networks do to maximize their ability to sell high margin ads targeting Internet users. It makes sense. If they can tell from your clickstream behavior that you are likely looking for a new car, then they can create a lot of value by showing you new car ads. Value for advertisers and value for you… after all, you ARE in the market for a new car, right?

When it works, it’s cool. But what about when you don’t want it working? When you want a little discretion as you window shop? When you’d like some privacy? Unfortunately, it doesn’t work that way. Users can’t tell when the ad networks are, or are not, tracking–it is all invisible to them–and there’s no equivalent of a “do not call list” to turn off such tracking.

The right answer is to move toward user-centric advertising, where the user is explicitly in control of all the data used to offer them ads and can even limit the types of ads shown. This resonates with Esther Dyson’s testimony to the Federal Trade Commission at their Townhall on behavioral targeting and her subsequent article at Huffington Post, where she proposed using a “Disclosure 2.0” approach to this issue.

handshakeIf advertisers and ad networks can create real value with behavioral tracking and targeting, then full disclosure–and even full user control–will only enhance trust and deepen the relationships between businesses and customers. The long term value of a customer depends on building viable, healthy relationships. Relationships depend on trust. By engaging openly and responsively with their customers–with full disclosure and as much user control as possible–companies can craft entirely new, more trusting and more profitable relationships while customers feel more comfortable about their personal boundaries, have increased confidence in their vendors, and get easier access to better products and services.

Advertisers need to get this. Ad networks and search engines need to support it. And it may be that regulators need to enforce it.

[This is precisely the sort of payoff for vendors that Project VRM is working towards.]

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