Google's 'interest-based' ads sure to stoke privacy fears

Google announced this morning that it is going to more and more sophisticated tracking of its users online browsing patterns in the interest of displaying to them advertising that will presumably be of greater interest. And while the company made all the requisite assurances about privacy and transparency, that's not stopping industry observers from predicting a showdown over the practice.

From a Google blog post headlined "Making ads more interesting:"

We think we can make online advertising even more relevant and useful by using additional information about the websites people visit. Today we are launching "interest-based" advertising as a beta test on our partner sites and on YouTube. These ads will associate categories of interest - say sports, gardening, cars, pets - with your browser, based on the types of sites you visit and the pages you view. We may then use those interest categories to show you more relevant text and display ads.

We believe there is real value to seeing ads about the things that interest you. If, for example, you love adventure travel and therefore visit adventure travel sites, Google could show you more ads for activities like hiking trips to Patagonia or African safaris. While interest-based advertising can infer your interest in adventure travel from the websites you visit, you can also choose your favorite categories, or tell us which categories you don't want to see ads for. Interest-based advertising also helps advertisers tailor ads for you based on your previous interactions with them, such as visits to their websites. So if you visit an online sports store, you may later be shown ads on other websites offering you a discount on running shoes during that store's upcoming sale.

Our advertisers and publisher partners have been asking us for a long time to offer interest-based advertising. Advertisers need an efficient way to reach those who are most interested in their products and services. And publishers can generate more revenue when they connect advertisers to interested audiences.

Peter Kafka of the Wall Street Journal speculates that Google's announcement will spur Congress to act; in particular, U.S. Rep. Rick Boucher, D-Va.:

Boucher, who heads the House subcommittee on communications, technology and the Internet, has already drawn a bead on behavioral targeting. Last month, he called on Congress to start regulating the practice, rather than allowing Yahoo (YHOO), Time Warner's AOL (TWX) and everyone else promise to behave themselves.

At the time, Boucher said he didn't have a timetable drawn up for his proposed online privacy bill. But Google's announcement today surely means we'll see it introduced sooner than later.

This is a debate that promises to produce fireworks.

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