FTC regulation of behavioral advertising

File: Seal the United States Federal Trade Commission.svg thumb alt= Seal The United States Federal Commission FTC has been involved in oversight the behavioral targeting techniques used by online advertisers since the mid-1990s. These techniques, initially called online profiling are now referred to as behavioral targeting they are used to target online behavioral advertising OBA to consumers based on preferences inferred from their behavior During the period from the mid-1990s to the present the FTC held a series workshops published a number reports and gave numerous recommendations regarding both industry Industry self-regulation self regulation and Federal government the United States Federal regulation OBA. In late 2010 the FTC proposed a legislative framework for U.S.consumer Information privacy data privacy including a proposal for a Do Not Track mechanism. In 2011 a number bills were introduced into the United States Congress that would regulate OBA[1] OBA, along with deep packet inspection DPI are specifically noted as not commonly accepted practices.[2] At the press conference to introduce the bill,Senators Kerry and McCain said that the bill struck a compromise between business and consumer interests noting that the bill was supported by Microsoft Intel andeBay <ref>Cecilia Kang, Senators Introduce Internet Privacy Bill Washington Post (April 14, 2011), http:www.washingtonpost.com/blogs post-tech post senators-introduce-internet-privacy-bill 2011 04/12 AFL0CjRD_blog html<ref> The bill tasks the FTC with developing rules specifically targeted at OBA, requiring companies to offer consumers a robust clear and conspicuous opt-out mechanism from the use their personally identifiable information]] by third parties for behavioral advertising or marketing”.<ref name=Kay>Kate Kay, Kerry and McCain Bill Signals Privacy Law Momentum clickz.com (April 12 2011 http:www.clickz.com clickz news 2042942 kerry-mccain-signals-privacy-law-momentum.<ref> The bill calls for the FTC to create regulations requiring businesses collecting personally identifiable information, such as names and email addresses to provide clear concise and timely notice data collection, use and transfer, along with a clear and conspicuous mechanism for opt-out consent for any unauthorized use consumers personally identifiable information.<ref name=Kay> The bill contains a provision which would require opt-in consent for the collection, use or transfer sensitive personally identifiable information Sensitive personally identifiable information is defined as “personally identifiable information which if lost, compromised,or disclosed without authorization either alone or with other information carries a significant risk economic or physical harm or is related to a particular medical condition, health record or the religious affiliation an individual.<ref name=KerryMcCain> The bill also tasks the FTC with establishing a voluntarySafe harborlaw safe harbor program to review, approve, and monitor self-regulatory programs that provide consumers with clear conspicuous, persistent and effective” opt-out from online behavioral advertising or location-based advertising.<ref name=Kang>Cecilia Kang,Senators Introduce Internet Privacy Bill, Washington Post (April 4, 2011http:www.washingtonpost.com/blogs post-tech postsenators-introduce-internet-bill 2011 04 12 AFL0CjRD_blog.html<ref> Once a self-regulatory program is approved by the FTC and the members that program are covered by the safe harbor, those members would be exempt from some the provisions the bill<ref name=Kang> The bill does not include the FTC’s proposed Do Not Track mechanism, which Senator McCain stated at the press conference didn't seem to fit in our ability to get a balance for consumer and industry support<ref name=Kang> The bill also does not include a private right of action, leaving enforcement up to the FTC and State Attorneys General<ref name=Kang> Consumer and privacy advocates have stated that the bill was not strong enough and should contain the FTC’s Do Not Track proposal.<ref name=Kang>Reflist2 Category:Federal Trade CommissionCategory:Online advertisingCategory:Advertising in the United StatesCategory:Advertising regulationCategory:Regulation in the United States

  1. H.R. 654, Rep.Jackie Speier (D-CA), Do Not Track Me Online Act2011 http:speier.house.govuploadsDo%20Not%20Track%20Me%20nline%20ActpdfWebarchiveurl=httpweb.archive.orgweb20110406172120 http:speier.house.govuploads Do%20Not%20Track%20Me%20Online%20Act.pdfdate=2011-04-06 Sen John Kerry D-MA cosponsor SenJohn McCain R-AZ Commercial Privacy Bill Rights Act 2011 April 12, 2011 http:kerry.senate.govworkissuesissueid=74638d00-002c-4f5e-9709-1cb51c6759e6&CFID=86949172&CFTOKEN=10485539 Webarchiveurl=http:web.archiveorgweb20110416073143http:kerrysenate.govworkissuesissueid=74638d00-002c-4f5e-9709-1cb51c6759e6&CFID=74656991&CFTOKEN=65407946 date=2011-04-16<ref> Early history The Federal Trade Commission has been involved in addressing online privacy issues for almost as long as there has been an online marketplace<ref>FTC Privacy Online: A Report to Congress June 1998), http:www.ftc.govreportsprivacy3priv-23a.pdfWebarchiveurl=http:webarchive.orgweb20100527140337http:www.ftc.govreportsprivacy3priv-23a.pdfdate=2010-05-27 <ref>The FTC is now responsible for the enforcement a number sector-specific privacy statues, including the Gramm-Leach-Bliley Act the Children's Online Privacy Protection Act the CAN-SPAM Act 2003 and the Telemarketing and Consumer Fraud and Abuse Prevention Act Do Not Call Rule. In 1995<ref name=FTCStaffReport>FTC Staff Report Public Workshop on Consumer Privacy on the Global Information Infrastructure Decn1996, http:www.ftc.govreportsprivacyPrivacy1shtm Webarchiveurl=http:web.archive.orgweb20100527211332http:www.ftc.govreportsprivacyPrivacy1shtmdate=2010-05-27 .<ref>1996<ref name=FTCStaffReport> and 1997<ref>See-FTC FTC Announces Two Significant Efforts In Its Comprehensive Examination Of Consumer Privacy March 41997), http:www.ftc.gov opa199703conspriv.shtmWebarchiveurl=http:web.archive.orgweb20111011061341http:ftc.gov opa1997 03conspriv.shtm date=2011-10-11 <ref> the FTC held public workshops exploring consumer data privacy issues. At these workshops online advertising industry advocates pressed for self-regulation while privacy advocates argued that self-regulation could only be successful when backed up by legally enforceable rights to information privacy<ref name=FTCStaffReport2>FTC Staff Reportn Public Workshop on Consumer Privacy on the Global Information Infrastructure December 1996 at 2 http:www.ftc.govreportsprivacy Privacy1.shtm Webarchive url=http: web.archive.orgweb20100527211332http:www.ftcgovreportsprivacyPrivacy1.shtm date=2010-05-27<ref> Industrylobbyists argued for opt-out which allows companies to use personal information for the purposes stated in a privacy policy or other form notification, unless the consumer opts-out and notifies the company not to use the personal information in a certain manner such as for marketingadvocates argued for prior affirmative consent, and suggested that software could be used by consumers to communicate their privacy preferences automatically.<ref name=FTCStaffReport2> In 1998 the FTC released a report in which it undertook a comprehensive review com mercial websites disclosures of their privacy practices and laid out the FTC Fair Information Practice Fair Information Practice Principles FIPPs The report concluded thatas evidenced by the Com mission’s survey results and despite the Commission’s three-year privacy initiative supporting a self-regulatory response to consumers’ privacy concerns, the vast majority online businesses have yet to adopt even the most fundamental fair information practice notice awareness <ref> FTC Online: A Report to Congress June 1998 at 41, http:www.ftc.govreportsprivacy3-23a.pdf Webarchiveurl=http:web.archive.org web 20100527140337http:www.ftc.govreportsprivacy323apdf date=2010-05-27 <ref> The FTC held a further public workshop in 1999<ref>FTC Press Release,FTC and Commerce Dept to Hold Workshop on Online September 15 1999 http:www.ftc.govopa199909profiling.shtm Web archiveurl=http:web.archive.org web 20100604115815 http:www.ftc.gov opa 1999/09 profiling.shtm date=2010-06-04 <ref> and in May 2000, released a report which for the first time recommended that Congress pass online privacy legislation to create a basic level data privacy protection for consumer-oriented commercial web sites<ref>FTC Privacy Online: Fair Information Practices in the Electronic Marketplace May 2000 http:www.ftc.govreports2000privacy2000.pdf<ref> In July 2000 the FTC recommended for the first time that legislation should be passed to protect Internet user’s privacy vis-à-vis online profiling.<ref name=OnlineProfiling11">FTC,Online Profiling A Report To Congress Part 2 RecommendationsJuly 2000 at 11 http:www.ftc.gov os200007onlineprofiling.pdf Web archiveurl=https:web.archive.org web 20100308002731http:www.ftc.gov os 2000 07 onlineprofiling.pdfdate=2010-03-08 <ref> The FTC further stated that backstop legislation addressing online profiling is still required to fully ensure that consumers is protected online and recommended that technology neutrallegislation be passed that created a basic level privacy protection for users consumer-oriented commercial websites with respect to profiling<ref>FTC Online Profiling A Report To Congress, Part 2 Recommendations July 2000 at 10, http:www.ftc.gov os 2000 07 onlineprofiling.pdf Webarchiveurl=http:web.archive.org web20100308002731http:www.ftc.govos 200007onlineprofiling.pdf date=2010-03-08<ref> Under the FTCs 2000 proposal all online advertising networks and consumer-oriented commercial websites that allowed the collection information from or about consumers would be required to implement and comply with the FIPPs<ref name=OnlineProfiling11> Congress did not enact the FTC’s recommended legislation,and another decade would pass before the FTC again proposed legislation to regulate OBA.<ref name=ftc.gov>FTC Protecting Consumer Privacy in an Era of Rapid Change:A Proposed Framework for Businesses and Policymakers (December 12010), http:www.ftc.gov os201012101201report.pdf.<ref> FTC CommissionerTimothy Muris turned the FTC’s attention away from online privacy and OBA regulation in 2001, stating,the slowing the growth the Internet emphasizes the need to understand the cost online privacy legislation…At this time, we need more law enforcement,not more laws.<ref>Timothy J.Muris,Protecting Consumers' Privacy: 2002 and Beyond, Remarks delivered at the Privacy 2001 Conference October 4 2001 http:www.ftc.gov speeches muris privisp1002.shtm Webarchiveurl=http:web.archive.org web 20100115092530 http:www.ftc.gov speeches muris privisp1002.shtmdate=2010-01-15 <ref> Return to regulatory focus In 2006 the FTC once again took up the mantle online privacy protection at the November 2006 FTC forum, Tech-ade which examined the key technological and business developments that will shape consumers core experiences in the coming ten years”.<ref>FTC Protecting Consumers in the Next Tech-ade: A Report by the Staff the Federal Trade Commission March 2008 http:www.ftc.gov os 2008 03 P064101tech.pdf.<ref> Participants at the forum described how technological advances in online profiling (now called “behavioral advertising, targeting or marketing), had allowed the practice to become more widespread and efficient<ref>FTC Staff Report,Self-Regulatory Principles For Online Behavioral Advertising, Behavioral Advertising Tracking Targeting & Technology February 2009 at 8 cite web url=http:www.ftc.gov os 2009 02 P085400behavadreport.pdf title=Archived copy access-date=2010-03-11 url-status=dead archive-url=http:web.archive.org web 20100604134118 http:www.ftc.gov os 2009 02 P085400behavadreport.pdf archive-date=2010-06-04 df= <ref> Building on the Tech-ade hearings, the FTC hosted a town hall meetingin November 2007 focused specifically on the privacy implications behavioral advertising practices called Ehavioral Advertising:Tracking, Targeting and Technology.<ref>FTCTown Hall Ehavioral Advertising:Tracking, Targeting, and Technology, http:www.ftc.gov bcp works hops ehavioral index.shtml.<ref> The public meeting was prompted in part, by the growth behavioral advertising and the interestlarge Internet companies in using such techniques to deliver narrowly targeted ads. These developments included Google’s plans to acquire DoubleClick,AOLs interest in Tacoda and Microsoft and Yahoo’s continued expansion of their own behavioral advertising products<ref name=6PLVR1275>See FTC to Examine Consumer Tracking Practices Used by Online Ad Industry 6 PVLR 1275 2007.<ref>They also included a presentation by eBay with a live demonstration the ebay.com website, highlighting the first on ad links enabling consumers to opt out behavioral ads via an eBay program called AdChoice. In December 2007 the FTC promulgated a set proposed Principles intended to provide a basis for the online advertising industry’s self-regulatory efforts to address privacy concerns.<ref>FTC Online Behavioral Advertising Moving the Discussion Forward to Possible Self-Regulatory Principles December 2007 http:www.ftc.gov os 2007 12 P859900stmt.pdf Webarchive url=http:web.archive.orgweb20101226204829 http:www.ftc.gov os 2007 12 P859900stmt.pdf date=2010-12-26<ref>The Principles call for companies to obtain affirmative express consent from consumers before they use data in a manner that is materially different than promised at the time collection and before they collect and use 'sensitive' consumer data for behavioral advertising<ref>FTC Online Behavioral Advertising Moving the Discussion Forward to Possible Self-Regulatory Principles December 2007 at 5 http:www.ftc.gov os 200712P859900stmt.pdf Webarchive url=http:web.archive.org web 20101226204829 http:www.ftc.gov os 200712P859900stmtpdf date=2010-12-26<ref> The FTC followed up this 2007 report with a further report in 2009, which further clarified the self-regulatory principles<ref>FTC Staff Report Self-Regulatory Principles For Online Behavioral Advertising, Behavioral Advertising Tracking Targeting, & Technology February 2009 cite web url=http:www.ftc.gov os 2009 02 P085400behavadreport.pdftitle=Archived copy access-date=2010-03-11 url-status=dead archive-url=http:web.archive.org web 20100604134118 http:www.ftc.govos 200902P085400behavadreportpdf archive-date=2010-06-04 df= <ref> At the time, a coalition consumer groups proposed a Do Not Track List in their comments to the 2007 town hall meeting<ref>FTC Staff Report Self Regulatory Principles For Online Behavioral Advertising, Behavioral Advertising Tracking Targeting & Technology February 2009 at 32 cite weburl=http:www.ftc.govos200902P085400behavadreportpdf title=Archived copy access-date=2010-03-11 url-status=dead archive-url=http:web.archive.org web20100604134118http:www.ftc.gov os 2009 02 P085400behavadreport.pdf archive-date=2010-06-04 df=<ref> The FTC’s 2010 report In a December 2010 report, the FTC proposed a new regulatory framework for consumer data privacy, including a proposal for a Do Not Track mechanism which would allow Internet users to opt out OBA<ref name=ftc gov In the report the FTC describes the limitations the existing notice and choice model, which it states have become increasingly apparent in recent years.<ref>FTCProtecting Consumer Privacy in an Era Rapid Change: A Proposed Framework for Businesses and Policymakers December 12010at 19, http:www.ftc.gov os 2010 12 101201privacyreport.pdf<ref> The FTC states that the notice and choice-based model en courages companies to develop privacy notices describing their information collection and use practices to consumers so that consumers can make informed choices<ref name=ProtectingPrivacyiii>FTC Protecting Consumer Privacy in an Era Rapid Change: A Proposed Framework for Businesses and Policymakers December 1 2010 at iii http:www.ftc.gov os 2010 12 101201privacyreport.pdf<ref> However the notice-and-choice model, as implemented, has led to long, incomprehensible privacy policies that consumers typically do not read, let alone understand.Like wise the harm-based model has been criticized for failing to recognize a wider rangeprivacy-related concerns, including reputational harm or the fear being monitored<ref name=ProtectingPrivacyiii> In order to address the issues with the notice-and-choice-based model the FTC’s proposed framework calls on companies to provide consumers with a meaningful choice in regards to OBA tracking, but sets forth a limited set data practices for which choice is not necessary called commonly accepted practices<ref>FTC, Protecting Consumer Privacy in an Era of Rapid Change: A Proposed Framework for Businesses and Policymakers December 1 2010 at 53, http:www.ftc.gov os 2010 12 101201privacyreport.pdf<ref> The commonly accepted practices include: Product and service fulfillment, internal operations fraud prevention legal compliance and first-party marketing, including contextual marketing.<ref>FTCProtecting Consumer Privacy in an Era Rapid Change: A Proposed Framework for Businesses and Policymakers (December 1, 2010 at 53–55 see also note 134 at 55, http:www.ftc.gov os/2010/12/101201privacyreport.pdf.
  2. FTC Protecting Consumer Privacy in an Era Rapid Change: A Proposed Framework for Businesses and makers December 12010 at 58, http:www.ftc.gov os 2010 12 101201privacyreportpdf<ref> Furthermore, the report states that the FTC supports prior affirmative express consent in regards to the collection “sensitive information children financial and medical information, precise geolocation data for OBA.<ref>FTC Protecting Consumer Privacy in an Era Rapid Change: A Proposed Framework for Businesses and Policymakers December 1, 2010 at 61 http:www.ftc.gov os 201012101201privacyreport.pdf.<ref>Do Not Track In the 2010 report the FTC proposed a uniform and comprehensive consumer choice mechanism for OBA, referred to as Do Not Track The FTC states t he most practical method of providing uniform choice for online behavioral advertising would likely involve placing a setting similar to a persistent on a consumer’s browser and conveying that setting to sites that the browser visits, to signal whether or not the consumer wants to be tracked or receive targeted advertisements<ref>FTC, Protecting Consumer Privacy in an Era of Rapid Change: A Proposed Framework for Businesses and Policymakers December 1, 2010 at 66, http:www.ftc.gov os 2010 12 101201privacyreport.pdf.<ref> The FTC believes that a "Do Not Track" mechanism is preferable to the existing browser-based cookie opt-outs as it is more clear easy to locate and effectiv and it conveys the user’s choice to opt out tracking directly to websites<ref>FTCProtecting Consumer Privacy in an Era Rapid Change: A Proposed Framework for Businesses and Policymakers December 12010 at 67http:www.ftc.gov os201012101201privacyreport.pdf.<ref> FTC goes to Congress On March 16 2011 the FTC appeared before the United States Senate United States Senate Committee on Commerce, Science and Transportation Com merce Committee At the hearing, the FTC recommended imposing more stringent measures to protect Internet users against unauthorized tracking in support behavioral advertising, including a universal Do Not Track browser setting.<ref name="HowToRespond">Dominique R. Shelton and Clinton J. McCord, How to Respond to Recent Developments in Consumer Information Regulation March 23 2011 http:www.wildman.com bulletin/3232011 Webarchive url=http:web.archive.org web 20110720181911 http:www.wildman.com bulletin 3232011 date=2011-07-20<ref> The FTC also announced its first behavioral advertising case filed against network advertiser Chitika for using a deceptive opt-out mechanism.<ref name=HowToRespond> As part of the settlement the FTC required that Chitika link all its advertising to an effective opt-out mechanism in future.It has been commented thatthis requirement a hyperlink embedded in online advertisements is a good indicator the type Do Not Track mechanism that will be acceptable to the FTC if Do Not Track' becomes mandatory<ref name=HowToRespond> At the same Senate hearing the Barack Obama administration called for a new Internet user’s bill rights which would give the FTC authority to regulate online behavioral advertising<ref name=HowToRespond> Congress proposes legislation Do Not Track Me Online Act 2011 Representative Jackie SpeierD-CA introduced the Do Not Track Me Online Act2011<ref name=DoNotTrack>H.R. 654, Rep Jackie Speier D-CA Do Not Track Me Online Act 2011 http:speier.house.gov uploads/Do%20Not%20Track%20Me%20Online%20Act.pdfWebarchiveurl=http:web.archive.orgweb20110406172120/http:speier.house.gov uploads/Do%20Not%20Track%20Me%20Online%20Act.pdfdate=2011-04-06 <ref> which would authorize the FTC to promulgate regulations requiring online advertisers and websites to allow users to opt out having their online activities tracked through the creation a do-not-track mechanism. The bill gives users the ability to block all collection of data for OBA but gives an exception for commonly accepted practices such as fraud prevention and inventory control<ref name=Do Not Track > The bill authorizes the FTC to enforce the new regulations by conducting random audits Web publishers although the proposed regulations contain an exception for websites that have less than 10,000 visitors per year<ref>Wendy Davis Privacy Track Bill Draws Key Support Online Media Daily February 11 2011http:www.mediapost.comtions article 144858<ref>The bill never reached a vote and died in Congress.<ref>H.R. 654 — 112th Congress Do Not Track Me Online Act www.GovTrackus 2011. May 1 2017http:www.govtrack.us congressbills112hr654<ref> Commercial Privacy Bill Rights Act 2011 On April 12 2011 Senator John Kerry introduced the Commercial Privacy Bill Rights Act 2011 co-sponsored by Senator John McCain<ref name=KerryMcCain>Sen.John Kerry D-MA cosponsor Sen. John McCain R-AZ Commercial Privacy Bill Rights Act of 2011 April 12, 2011 http:kerry.senate.gov work issues issue id=74638d00-002c-4f5e-9709-1cb51c6759e6&CFID=86949172&CFTOKEN=10485539 Web archive url=http:web.archive.org web 20110416073143 http:kerry.senate.gov work issuesissueid=74638d00-002c-4f5e-9709-1cb51c6759e6&CFID=74656991&CFTOKEN=65407946 date=2011-04-16 }}
This article is issued from Wikipedia. The text is licensed under Creative Commons - Attribution - Sharealike. Additional terms may apply for the media files.