Advertisers have created seven principles for self regulation

Several marketing associations, prodded by Google, declare their intentions to protect the public's privacy. Why don't I believe them?

Yesterday, a group of advertising trade associations, prodded by Google, declared they were adopting seven self-regulating privacy principles to protect consumers from themselves. Exactly a year ago Google and Microsoft genuflected to government inquiries with promises of improved privacy protection for Web users from advertisers. Since then, there have been lots of shaking the fist at the sky over privacy protections, and cause for alarm by privacy protection groups, but not much action. This attempt at self-regulation is laughably more of the same according to a well-reasoned blog post by Stacey Higginbotham at Gigaom.

Stacey writes:

"Several marketing associations supported by Google have banded together and released seven principles that they believe should govern online privacy. Are you ready for a journey to the Emerald City? Because the principles are the online advertisers’ attempts to stave off government regulation around protecting consumers’ online privacy by diverting attention to the Great and Powerful Principles rather than the data scavenging that’s going on behind the curtain. Kind of like a certain self-aggrandizing wizard."

Here is the list of principle the group wants to implement along with my (admittedly cynical) interpretation of each.

The Education Principle calls for advertisers to participate in a major campaign "that is expected to exceed 500 million online advertising impressions" over the next 18 months to educate consumers about why tracking their movement online is good for them and how they can opt out. They are going to use ads to get people to stop blocking ads.

The Transparency Principle is an attempt to better tell people what data is being collected and how it is being used. The group says, "It will result in new, enhanced notice on the page where data is collected through links embedded in or around advertisements, or on the Web page itself." In other words, a thicker, and likely more jargon filled "privacy" page.

The Consumer Control Principle is the one highlight of the bunch in that it is supposed to give consumers more control over the data collected about them, and even allow them to opt out. Again, though, seems a bit tricky, in that advertisers want to offer this choice on a Web page. On the upside, the group wants to extend responsibility to service providers. They say, "The Consumer Control Principle requires service providers, a term that includes Internet access service providers and providers of desktop applications software such as Web browser tool bars to obtain the consent of users before engaging in online behavioral advertising, and take steps to de-identify the data used for such purposes."

The Data Security Principle would also be a winner, if it were implemented in a way that also included verification. It wants "organizations to provide reasonable security for, and limited retention of data, collected and used for online behavioral advertising purposes."

The Material Changes Principle is obnoxious. It wants organizations to find consumers and get their consent before significantly altering how advertisers will track personal information. On the surface, that seems ok, but it is based on the assumption that the marketers need so badly to collect personal information about Web users in order to sell their wares online, that even after someone has opted of collection, they can be later tracked.

The Sensitive Data Principle goes obnoxious one further. It offers guidelines on how to collect data on children and individuals with health problems. On the positive side, it wants to ensure parents are opting in. On the negative side, seriously -- how about a principle that says data WILL NOT be collected on children or about people's health problems unless a person approaches an advertising firm and asks to be part of its database.

The Accountability Principle calls for self-regulators to create some kind of consequences for those that violate its policies. Fair enough, but unless civil or criminal liabilities are established (companies can be fined by the government or sent to jail for placing their own interests above the people's rights to privacy), who much teeth can these "accountability mechanisms" really have?

Google itself has admitted that accountability is key. The Google Public Policy blog writes,

"One of the key strengths of the principles is the fact that they apply to a broad range of companies participating in online advertising -- advertisers, publishers, and ad networks. Of course, for any self-regulatory effort to be effective, there has to be some kind of enforcement process. Between now and early 2010 -- when the principles are expected to be implemented -- the Better Business Bureau and Direct Marketing Association, two of the groups involved, will work to set up that process to make sure it has real teeth."

I am all for advertising. I make my living from ads. Go ahead, try and sell me stuff. I spend as much time as anyone else buying that stuff. I am all for self-regulation in the form of self-control and people behaving well to one another. But when it comes to allowing the foxes to guard the henhouse, I'd rather build a nice fat fence that all sides can see and understand. Online advertising needs regulation. Without, people have every reason to find ways to block advertising.

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