The "Do Not Call" list is back on the Washington agenda, this time as a proposed response to online advertising concerns. A so-called "Do Not Track" approach for behavioral advertising, which appears to be gaining traction with regulators and legislators, could have a significant impact on the online revenues of broadcast stations.
"Do Not Track" would seem to apply the principles behind the successful "Do Not Call" telemarketing regulations to online advertising. Currently, advertising networks use online tracking tools (such as cookies, Flash cookies and clear GIFs) to make informed guesses about a user's age, gender, income, home value and other demographic information. Online ad networks use this information to build startlingly accurate user profiles, which in turn determine what online ads will be delivered to a user. This ability to reach the narrow consumer segment most likely to purchase an advertised product makes online advertising more valuable for advertisers. Accordingly, online content providers like broadcasters can charge a "behavioral advertising" premium for online ad space. "Do Not Track" threatens this premium because it could block the flow of user data on which profiles are based, in turn degrading ad networks' ability to match precisely an ad with a likely customer. Users potentially could block this data flow by signing up at a central registry to block tracking of their surfing habits. Or more likely, users would take advantage of legally-mandated web browser settings that would transmit information to online operators telling them to refrain from tracking.
On December 1, 2010, the Federal Trade Commission (FTC) issued a preliminary staff report supporting "Do Not Track." The report encourages companies that collect or use consumer data to offer consumers choices about how their information is collected and used online. The report specifically endorses a browser-based setting for consumers to indicate if they want to be tracked and receive targeted advertisements, along with a requirement that sites honor those choices. "Do Not Track" is also gaining traction in Congress, where it is serving as the topic of an Internet privacy hearing in the House Subcommittee on Commerce, Trade and Consumer Protection on Thursday, December 2.