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Tracking Down the Answers to Who Can Opt Out of Being Tracked by Google, Yahoo, AOL, Time Warner, NBC Universal, Amazon, and The New York Times

By ThreatMetrix
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To track or “Do Not Track.” That is the question. And a damned sight harder to answer than Hamlet’s “to be or not to be” which was only about a matter of life and death.

The Obama administration and advertisers have been working on the knotty problem of protecting consumers’ privacy without stifling the burgeoning online advertising business, which according to Tanzina Vega’s The New York Times’ article is “seen as the savior of media and publishing companies.”

Interactive Advertising Bureau figures put U.S. digital advertising revenues at $7.88 billion for the third quarter of 2011, a 22 percent increase over the same period in 2010. And, nobody wants to throw the baby out with the bathwater or kill the goose that laid the golden egg or hear any more aphorisms.

In The New York Times article, Vega writes, “Until now, methods for opting out of custom advertising varied depending on the privacy settings of a user’s browser or whether a user clicked on the blue triangle icons in the corners of some digital ads.

“Under the new system, browser vendors will build an option into their browser settings that, when selected, will send a signal to companies collecting data that the user does not want to be tracked.” This applies to so-called “third-party” sites, which collect and use data to send ads tailored to specific users. Included are sites like Google-owned DoubleClick, AOL’s, and many smaller ad networks.

The third-party sites, says Vega, “would be restricted in the data they can collect on users if [users] select a Do Not Track option. Such companies would be limited to using data for purposes like market research and analytics but could not create detailed profiles on users or show them ads based on online behavior.”

However, many publishers and search engines, like Google, Amazon and The New York Times, are considered “first-party sites,” which means that the consumer goes to these Web pages directly. “First-party sites can still collect data on visitors and serve them ads based on what is collected.” Seems like Google’s got it both ways. Or either way. ANYWAY…

In The Times article several pro-advertiser voices such as George Pappachen, the chief privacy officer of the Kantar Group, the research and consultant unit of WPP and Mike Zaneis, the senior vice president for public policy and general counsel of the Interactive Advertising Bureau, warned about the severe impact to the industry of a large number of consumer opt outs should the wrong opt-out mechanisms be adopted.

Zaneis offers, “The reality is if you had 50-80 percent of consumers opting out it could have a really significant negative impact on the third-party ad model. There is no eraser button for the Internet. But we can address consumers’ concerns about having certain data about them collected, especially data for advertising and marketing.”

Vega writes, “Google, which is one of the biggest players in online advertising, would also be affected because it is both a first- and third-party publisher. The company earns most of its nearly $40 billion in revenue through search-related advertising, which would not be affected by Do Not Track. But its display advertising business, driven largely by its DoubleClick ad network, representing some $5 billion in revenue, is considered third party and could be affected.”

A Pew Research Center study cited in The New York Times story said “56 percent of the respondents thought the government should not become more involved with regulating how Internet companies handle privacy issues. Yet 59 percent said collection of user data for targeted advertising was an unjustified use of a person’s private information.” Sounds like the dictionary definition of being of two minds on one subject.

And speaking of two minds – Should Facebook whose “like” button is used across multiple Websites be considered a first-party or third-party site? Or maybe it should get the Google two-fer.

Finally, Alex Fowler, the global privacy leader at Mozilla, whose Firefox was the first browser with a Do Not Track option, has the final word, ““When you look at user testing, the expectation for the user for Do Not Track means, don’t behaviorally target me and also don’t collect information on me.”

By ThreatMetrix Posted