Hearing Exposes Industry Finger-Pointing As Do Not Track Rules Yet to Materialize

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By Alexei Alexis  


A battle over the development of industry do not track rules for the internet took center stage at an April 24 hearing before the Senate Commerce, Science, and Transportation Committee.

The panel's chairman, Sen. John D. Rockefeller IV (D-W.Va.), expressed frustration that a do not track agreement has been delayed for months due to conflicts among industry players.

“I urge everybody to take a deep breath and tone down the rhetoric,” Rockefeller said. “We all need to remember that this debate is about consumers and their choices--consumers who may be happy to have their information collected for targeted advertising in some situations, but who may want advertisers to completely leave them alone at other times.”

At the hearing, the online advertising industry was accused of holding up the do not track effort. But the Digital Advertising Alliance (DAA), a consortium of marketing industry groups, blamed leading web-browser manufacturers Microsoft Corp. and Mozilla.

The witnesses included Lou Mastria, managing director of the DAA, and Harvey Anderson, senior vice president of business and legal affairs and general counsel at Mozilla. Both told the committee that they were committed to working toward a solution.

Legislative Action Possible

Rockefeller told reporters after the hearing that legislative action is possible if industry players ultimately fail to resolve the issue on their own.

In February, Rockefeller introduced a bill (S. 418) that would require online firms to honor a consumer's choice to opt out of being tracked while surfing the web. The Federal Trade Commission would be given authority to pursue enforcement actions (12 PVLR 369, 3/4/13).

Rockefeller introduced similar legislation in the previous Congress, but it received push back from industry groups and was never brought up for a committee vote.

A coalition of consumer advocacy groups--including the Center for Digital Democracy, the Privacy Rights Clearinghouse, the Consumer Federation of America, Consumer Action, Consumer Watchdog, and U.S. PIRG--April 22 offered support for Rockefeller's do not track legislation. “It's now clear that legislation is necessary to ensure consumers get the protection they deserve and expect,” the groups said in a statement. “Self-regulatory efforts to develop a Do-Not-Track standard have stalled.”

“Legislation would be superfluous given that an end to end system with enforcement covers the entire ecosystem today,” Stu Ingis, an attorney in the Washington office of Venable LLP and a counsel for the DAA, told BNA April 22.

W3C Work Ongoing

At issue is the practice of behavioral advertising, which involves the tracking of consumers' online activities for targeted marketing purposes. The DAA administers a program to police companies that engage in the practice. Participating firms are required to display an industry icon within or near online ads or on web pages where data are collected and used for behavioral advertising. By clicking on the icon, consumers are able to link to a disclosure statement regarding the company's data collection practices, as well as an opt-out option. Under the framework, companies that fail to abide by privacy rules enforced by the DAA after making a commitment to do so may be held liable under Section 5 of the FTC Act, which prohibits unfair and deceptive trade practices.

The World Wide Web Consortium (W3C), an international organization that develops internet standards, is facilitating the development of voluntary do not track standards. A draft W3C proposal would allow consumers to make do not track choices through their web browser settings.

An industry framework was expected to be in place by the end of 2012. However, that deadline was not met, and significant differences remain.

Recently, FTC Chairwoman Edith Ramirez urged all industry players to “dive” into the W3C process with good faith (12 PVLR 683, 4/22/13). “[A]n online advertising system that breeds consumer discomfort is not a foundation for sustained growth,” she said in remarks prepared for an event sponsored by the American Advertising Federation. “More likely, it is an invitation to Congress and other policymakers in the [United States] and abroad to intervene with legislation or regulation and for technical measures by browsers or others to limit tracking.”

DAA Blames Web Browsers

A key obstacle, according to Mastria, has been Microsoft's decision last year to roll out a new Internet Explorer 10 browser with a default do not track setting. The DAA generally supports an opt-out, rather than opt-in, do not track standard and has said that its members will not be required to honor the Microsoft approach.

“Allowing browser manufacturers to determine these choices for users limits the information and experience received by consumers, and consumers' ability to enjoy the ad supported Internet provided by DAA participants and hundreds of thousands of other websites that consumers value,” Mastria said in his prepared remarks. “Most importantly, honoring the approach that Microsoft has elected to put in its browser was not part of the public commitment at the White House.”

In addition, Mozilla has implemented what it refers to as a do not track tool in the current Firefox release, also without following the White House agreement, Mastria added.

The process has been further delayed by the W3C, which has historically been a technical standards-setting organization and is ill-equipped to address public policy matters, he added.

Anderson said in his prepared remarks that efforts to shift blame to the W3C are “dubious.”

“Stakeholders that are standing by, waiting for the W3C to 'complete' its work are misguided,” he said. “Technical standards are adopted only after drafting, testing, refining and finalizing. But nothing prohibits de facto adoption during this process.”

By Alexei Alexis  

Further information on the Senate Commerce Committee hearing, "A Status Update on the Development of Voluntary Do-Not-Track Standards," including links to prepared witness testimony and an archived webcast of the hearing, is available at http://www.commerce.senate.gov/public/index.cfm?p=Hearings.

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