FTC Chair Edith Ramirez created some waves in her first speech to the advertising industry this week. Ramirez renewed the call for a universal Do Not Track mechanism—and impliedly ignored the progress of AdChoices, the Digital Advertising Alliance’s opt-out program. The FTC’s critical stance, along with a renewed initiative in the Senate, signal that the government is unsatisfied with the industry’s progress toward enhanced consumer controls over privacy and may seek a public, rather than private, solution.
“Consumers await a functioning Do Not Track system, which is long overdue,” Ramirez said. “We advocated for a persistent Do Not Track mechanism that allows consumers to stop control of data across all sites, and not just for targeting ads.”
The comments, spoken before the American Advertising Federation at their annual advertising day on Capitol Hill, illustrated a rift between advertisers and regulators over the progress of self-regulatory programs and consumers’ perceptions of online behavioral advertising. Two years ago, the FTC called on advertisers to develop a program that would give consumers a choice to opt out of behaviorally targeted ads. Speaking to AdWeek, Stu Inglis, a partner at Venable who acts as the DAA’s attorney, said of Ramirez’s remarks: “We have solved it. The DAA’s program covers 100 percent of the advertising ecosystem. We made our agreements.”
The DAA also recently released the results of a poll it commissioned, stating that nearly 70 per cent of consumers responding that they would like at least some ads tailored directly to their interests, and 75 per cent saying that they preferred an ad-supported internet model. (The poll comes with some caveats, described by an AdWeek piece today.)
However, in her speech Ramirez spoke of consumers’ “unease” with online tracking: “An online advertising system that breeds consumer discomfort is not a foundation for sustained growth. More likely, it is an invitation to Congress and other policymakers in the U.S. and abroad to intervene with legislation or regulation and for technical measures by browsers or others to limit tracking,” she said.
Ramirez also urged the advertising community to keep working within the multiparty process led by the W3C (World Wide Web Consortium) to develop a browser-based Do Not Track program. However, there has been little concrete progress in the talks so far.
The online advertising industry may be running out of time. Senator Jay Rockefeller D-W.Va.), chair of the Senate Commerce Committee, announced that he would hold a hearing next week to discuss legislation that would mandate a Do Not Track standard. The chairman, along with Sen. Richard Blumenthal (D-CT), introduced the Do Not Track Online Act in February. The bill would direct the FTC to write regulations governing when internet firms must honor a consumer’s request that their information not be collected, and deputize the FTC and state attorneys general to enforce the rules.
“Industry made a public commitment to honor Do-Not-Track requests from consumers but has not yet followed through,” Rockefeller said of the hearing. “I plan to use this hearing to find out what is holding up the development of voluntary Do-Not-Track standards that should have been adopted at the end of last year.”
If Congress and the FTC agree that the advertising industry hasn’t honored its commitments, the chances for self-regulation without a government mandate may dwindle further.