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Federal Trade Commission Chairman Jon Leibowitz told BNA Oct. 3 that he remains hopeful that consumer “do-not-track” standards for the internet industry can be finalized by the end of the year, despite ongoing conflicts.
“If [stakeholders] take a few steps back to the center, I think we can have a do-not-track option agreed to, if not put into effect, by the end of the year,” Leibowitz said.
At issue is the practice of behavioral advertising, which involves tracking consumers' online activities for targeted marketing purposes.
The do-not-track effort, which is being facilitated by the World Wide Web Consortium (W3C), an international organization that develops internet standards, is designed to make it easier for consumers to avoid having their online activities followed by companies (11 PVLR 1103, 7/9/12). A draft W3C proposal would allow consumers to make do-not-track choices through their web-browser settings.
Participants include browser providers Microsoft Corp. and Google Inc., which have agreed to provide do-not-track features in their web browsers, as well as members of an advertising industry consortium known as the Digital Advertising Alliance (DAA). The FTC has also been a key player.
FTC Commissioner Julie Brill proposed recently that consumer information collected pursuant to a do-not-track standard should be held for 30 days and then deleted (11 PVLR 1437, 9/24/12).
Although Leibowitz has been pushing for completion of an industry do-not-track framework by the end of the year, significant conflicts remain (11 PVLR 1103, 7/9/12).
In a Sept. 27 letter to House Republicans, Leibowitz defended the commission's role in the development of the standards.
Leibowitz said the FTC was pursuing a “carefully” balanced approach to protecting consumers, while allowing business and innovation to flourish.
“Concerning our role in [the effort], it in no way usurps the legislative process or imposes a burden on industry,” he said, adding that any resulting standards will be voluntary and self-regulatory.
The letter responded to Republican concerns set out in a Sept. 21 letter to Leibowitz asserting that the FTC was “driving” the development of do-not-track standards without authorization from Congress.
In its letter to Leibowitz, nine House Republicans, including Reps. Marsha Blackburn (R-Tenn.) and Tom Graves (R-Ga.), said they were “alarmed that the [commission] is driving the development of policies and technical Do Not Track (DNT) standards to restrict online advertising without any formal legal process or Congressional authorization, but rather through informal agency threats.”
The lawmakers said they were concerned that the FTC and W3C failed to study how certain do-not-track implementations could affect third-party advertising networks. In addition, they said it appears that some companies are using the process to gain a competitive advantage in the marketplace.
The effort is being closely watched by Sen. John D. Rockefeller IV (D-W.Va.), chairman of the Senate Commerce Committee. Rockefeller said that the commission's involvement is “entirely appropriate.”
“I have long expressed skepticism that private companies are capable of collectively producing and abiding by meaningful standards that protect consumers,” the senator said in an Oct. 3 letter to Leibowitz.
“If the advertising industry cannot be coaxed into living up to its commitment and adopting robust voluntary DNT standards, I believe it will only highlight the need for Congress to act in the wake of a long history of industry failure to provide American consumers with the privacy protections they deserve,” Rockefeller wrote.
The letter noted that during a May hearing, Leibowitz said congressional action would be warranted if industry fails to reach an agreement on meaningful do-not-track standards by the end of the year (11 PVLR 795, 5/14/12). “As we enter the fall of 2012, that end-of-the-year deadline looms large,” Rockefeller added.
A key sticking point has been whether do-not-track should apply to data collection, as well as use. Microsoft has further complicated the effort by announcing in May that its Internet Explorer 10 browser will use a default do-not-track setting, prompting objections from DAA members (11 PVLR 1068, 7/2/12). The industry generally prefers an “opt-out,” rather than “opt-in,” do-not-track standard.
The W3C's Tracking Protection Working Group (TPWG) was unable to finalize an agreement during a June 22-23 meeting in Bellevue, Wash. In its agenda for a scheduled October meeting in Amsterdam, the working group stated: “[W]e will now accept that many issues cannot be resolved in a way that does not raise any objections.”
DAA Managing Director Lou Mastria wrote to the W3C Oct. 2 to express “strong opposition” to the agenda language.
“This is not an appropriate process or means for moving forward on decisions that could affect the future of an entire online ecosystem,” Mastria said. “A non-consensus decision by the TPWG, an organization of unelected individuals who do not represent the interests of all stakeholders, should not be substituted for the consensus judgment of the participants given the impact such a decision could have on consumers, commerce, national and global economies, jobs, and the overall health of the Internet ecosystem.”
“The FTC is not using its formal regulatory authority to create mandatory or coercive regulations, de facto or otherwise,” the senator asserted.
Full text of the FTC's Sept. 27 letter is available at http://op.bna.com/der.nsf/r?Open=tbay-8yku6p.
Full text of the House Republicans' Sept. 21 letter is available at http://op.bna.com/der.nsf/r?Open=sfre-8yku6n.
Full text of Rockefeller's Oct. 3 letter is available at http://op.bna.com/der.nsf/r?Open=sfre-8yqu84.
The agenda for the W3C's October meeting is available at http://www.w3.org/2011/tracking-protection/agenda-2012-10-03-F2F-Amsterdam.html.
Full text of the DAA's Oct. 2 letter is available at http://op.bna.com/der.nsf/r?Open=sfre-8yqu9u.
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