When a broadcaster moves to online publishing, a new advertising revenue stream becomes available. This consists of advertising targeting an Internet user's interests. While a wide variety of types of online advertising exist, "behavioral targeting" is the subject of considerable public policy discussion.
"Behavioral targeting" refers to the process of selecting what advertisements a user will see based on knowledge of what pages and other websites the user has viewed, and possibly even what searches he or she has conducted. This allows businesses to market to the actual interests of their customers and website visitors. While this can benefit consumers by enhancing their online experience, and benefit the publisher by increasing advertising revenue, this advertising model has often been criticized as intrusive of the user's privacy.
Media companies looking to expand their online publishing efforts should be aware that the law governing behavioral targeting is subject to change. The most recent major development was the release this winter by the Federal Trade Commission (FTC) of a Staff Report on Self-Regulatory Principles for Online Behavioral Advertising. The FTC Staff Report imposes no legal obligations and does not have the status of a rule or regulation. However, the Report provides insights into the type of business activities that are of concern to the FTC staff, and thereby sheds light on the types of business practices that are likely to attract staff attention in future enforcement actions. Most importantly, the FTC Report states that online publishers should develop more clear privacy policies, especially where content is published to a mobile smart phone.
To date, the FTC has allowed industry to "self-regulate" through developing best practices. However, the new FTC chairman has stated that regulation or legislation would be in order if industry practices do not begin to conform more closely to the staff recommendations.