Government and advertisers have different ideas about 'Do Not Track'

The Obama administration and the technology industry have touted the creation of a "Do Not Track" button to help consumers protect their privacy online, but the government and advertisers are not on the same page about what such a button would do.

The Federal Trade Commission first proposed a Do Not Track button in 2010. The concept is modeled on the agency's popular "Do Not Call" list, which allows consumers to opt out of receiving telemarketing calls.

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FTC Chairman Jon Leibowitz urged Web companies to voluntarily set up a system for users to opt out of online tracking, and warned that legislation could be necessary if they failed to act.

Last month, all of the major Web browsers promised to create a Do Not Track feature, and the Digital Advertising Alliance, a coalition of advertising trade groups, said that by the end of the year, they would stop displaying targeted ads to users who had selected the feature in their browsers.

The commitment was announced as part of the White House's unveiling of its "Privacy Bill of Rights" – a set of principles about how companies should handle users' personal data.

Leibowitz praised the companies for "stepping up" to his challenge, and said the feature would ensure "consumers have greater choice and control over how they are tracked online."

But Mike Zaneis, general counsel of the Interactive Advertising Bureau, a member of the Digital Advertising Alliance, said the name "Do Not Track" is a "complete misnomer."

"Under no program will you have no tracking online," Zaneis said. "The Internet requires some level of tracking."

The feature is only aimed at allowing consumers to curtail the data that third-party advertisers collect about them online, he said.

Websites that users interact with directly, such as Facebook or Amazon, would still track users' activities. But by selecting the Do Not Track option, users would be able to prevent advertisements tailored to them based on their browsing history.

Ed Felten, the FTC's chief technologist, said the goal of Do Not Track is to "give consumers choice with online behavioral tracking."

"Many consumers are concerned about the collection of information across websites," Felten said.

The FTC explained its idea for how Do Not Track should work in a detailed report on online privacy, released Monday. 

"An effective Do Not Track system should go beyond simply opting consumers out of receiving targeted advertisements; it should opt them out of collection of behavioral data for all purposes other than those that would be consistent with the context of the interaction," the commission declared.

Felten said the "gap" between the FTC's idea of Do Not Track and the advertising industry's commitment is the result of broad exemptions the advertisers have identified for when companies can still collect data on a user who has selected the Do Not Track option.

Under the plan the Digital Advertising Alliance committed to, users who select the Do Not Track option will not see targeted ads, but the companies can still track users for "market research," "product development," "system management" and other purposes.

One of the few appropriate tracking exceptions the FTC identified was fraud prevention.

Felten said the FTC will continue talking with advertisers and other stakeholders to enhance privacy protections. 

But Zaneis said the advertising industry has no plans to change its privacy commitments.

"We've set the parameters of success on February 23," Zaneis said, referring to the announcement at the White House. "We're set on achieving those goals."

He said research has shown that targeted advertising is two and half times as valuable as non-targeted advertising.

He said if a majority of consumers opted for the Do Not Track feature it would have an "incredible, negative impact on the digital advertising industry."

But he said the industry's plan is to "focus on transparency" and to explain to consumers how their data is really used.

"Once they understand, they don't have the same level of concern," Zaneis said.