FTC Privacy Report Wants “Do Not Track” for Consumers

The Federal Trade Commission issued a report on December 1 calling for a “Do Not Track” mechanism in consumers’ web browsers so they can choose to have their actions monitored online. The report, “Protecting Consumer Privacy in an Era of Rapid Change” aims to be the first step in achieving a balance between the importance of user privacy and the need for innovative online products and services. FTC Commissioner Jon Leibowitz said the report “is not a template for enforcement…At this point I think we’re making recommendations for best practices.” While Privacy advocates are loving the report, the $23 billion online ad industry is not.

Restricting advertisers to track data regarding online searches and other browsing activities could result in an increase of unwanted advertisements and the loss of free content that is paid for by advertising. Mike Zaneis, Senior Vice President at the Interactive Advertising Bureau said in the Wall Street Journal article, “Web Privacy ‘Inadequate’” that consumers wouldn’t benefit from turning off tracking because “consumers depend on sharing data… to customize news sites, optimize Web services such as social networks, and provide relevant content and advertising across the Web.

The report also recommends that companies improve their privacy policies. Most of these found on the bottom of websites have become far too long and complicated. Even if a consumer does read it, it is not easy to understand or see how it applies to their usage of the website.

A factor that should not be overlooked is consumer education. While these policies are not legislation yet, the online marketing industry should ensure its consumers are aware of commercial data practices and the choices available to them.

The FTC will accept comments on its proposals through January 31, 2011 and will issue a final version of its report later in 2011.

The US Commerce Department is also planning to release a report containing online privacy recommendations soon. And it may contain ideas conflicting with what the FTC proposed. Stay tuned for updates.