In a letter sent to the director of the Federal Trade Commission and the chairman of the European Union’s Article 29 Working Party, groups like Consumers Union and the Center for Digital Democracy requested that the officials reject the self-regulatory privacy program instituted by the ad industry.
The self-regulatory principles created by the Digital Advertising Alliance require companies to provide “enhanced notice” to consumers and utilize an icon for interest-based ads that provide a signal to consumers that the site may be used to collect their data. The principles further require that consumers be given the ability to click on the icon, a lower case “i” with a triangle surrounding it, to receive more details about the advertiser’s data collection practices and choose to opt out of future targeted advertising.
But the letter, sent on behalf of the TransAtlantic Consumer Dialogue, a forum of American and European consumer organizations which makes joint policy recommendations to the governments to promote consumer interests, criticized the program. “Consumers in both the US and EU are offered limited options based on principles crafted by the digital marketing industry and ‘enforced’ by groups that do not represent consumers or governments and that are completely lacking in any independence from the industry they are intended to monitor.”
Expressing concerns about the efficacy of the behavioral advertising icon, the groups argue that the icon is “an insufficient means of notice” to users about the wide range of data collection taking place online. According to the letter, research has shown that very few users click on the icon, let alone opt out of being tracked. Even if users choose to opt out, the letter said, the tool is based on cookies, a nonpermanent solution that can be forgotten should the consumer delete the cookies from his or her browser.
The self-regulatory system was “principally designed to enable the expansion of [online behavioral advertising]-related data practices,” the letter said. Instead, the groups advocated that officials take a new path for regulation, that include an investigation of the various threats to consumer privacy, in particular new trends like the growth of real-time tracking, and the development of a global common standard for protecting privacy in the digital marketplace. “We respectfully urge you to reject the current [online behavioral advertising] self-regulatory regime as inadequate, and work with industry and consumer privacy groups to ensure that significant revisions are made to protect consumer privacy,” the letter concluded.
To read the letter, click here.
Why it matters: The letter is only the latest battle in the war over regulation of consumer privacy, with several pieces of legislation pending and multiple hearings scheduled on the topic in Washington. In response to the letter, legal counsel to the DAA told MediaPost that the Better Business Bureau’s National Advertising Review Council, which will enforce the self-regulatory program, has “100% independence” from the advertising industry. “The Better Business Bureau has done effective self-regulation independent of the industry for years,” he said.