To hear the advertising industry tell it just a few months ago, the drumbeat of talk of stringent consumer privacy regulations would spell the demise of the entire industry, the fall of free Internet content and possibly even democracy itself.
That hasn’t happened — and won’t happen — especially now that the economy is on the precipice of a double-dip recession. The industry’s self-regulation steps, while widely derided as too little by privacy advocates, appear to have been enough to spare it any of the strongest Federal Trade Commission regulations that would represent a sea change to how the ad system works.
“The FTC has consistently been on the record that they are very pleased with the self-regulatory program,” said Scott Meyer, CEO of Evidon. “Up on Capitol Hill, there seems to be waning momentum for a privacy bill that would cover behavioral advertising. Nobody wants to do anything to slow down job growth, and ours is one of the relatively few industries that is growing as it is in our economy today. Plus, and this has been a theme within this issue throughout, nobody has put forth a harm case for [online behavioral advertising].”
Meyer believes that critics referring to low opt-out rates under self-regulation programs might not understand some basic principles about banner advertising, and consumer concerns about privacy. “Critics point at low opt-out rates and call the program a failure. But, the opt-out rates are low even among those who click for more information! When consumers are more informed about [online behavioral advertising], they are less concerned. And consumers who then opt out are self-selecting because of this new transparency and identifying themselves as not likely to engage with marketers’ messages anyway.”
“With the White House soon to release a new privacy white paper that likely will rely on this flimsy self-regulatory system as a way to protect consumer privacy,” wrote Jeff Chester, executive director of The Center for Digital Democracy, a consumer privacy advocacy research institute. “The letter sent by U.S. and EU consumer and privacy groups sends a powerful message that such a plan will be insufficient and ineffective.”
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