• by Wendy Davis  @wendyndavis, April 7, 2009

AOL veteran Charles Curran has been named new executive director of the self-regulatory privacy group Network Advertising Initiative.

Curran will be based in Washington, where he will meet regularly with lawmakers and other officials who are now considering whether to pass new laws regulating Internet advertising and privacy. Members of the NAI include some of the biggest names in online advertising, including Advertising.com, Google and Yahoo.

His appointment comes at a time of increasing scrutiny for behavioral targeting. Congress last year held hearings about online advertising and privacy, and the Federal Trade Commission recently urged Web companies to do a better job of informing people about targeting and allow them to opt out.

Late last year, the NAI issued revised principles for behavioral targeting, or tracking people online and serving ads based on their Web activity. But two months later, the Federal Trade Commission put out its own suggested principles, which in some respects are more stringent than those released by the NAI. At the time, two FTC commissioners, Jon Leibowitz (now chair) and Pamela Jones Harbour, expressed reservations about whether the online ad industry could successfully regulate itself.

The NAI, like other online ad industry players, now must rethink approaches to informing Web users about behavioral targeting and allowing them to opt out of the practice.

"We're obviously very mindful of what the FTC has told us. We will try to be innovative, and focus on the issues they've presented," Curran said.

The FTC said in its most recent report about behavioral targeting that companies should give "clear, concise, consumer-friendly, and prominent" notice of the practice and allow consumers to opt out.

Former AOL colleague Jules Polonetsky, now heading the AT&T-funded think tank Future of Privacy Forum, praised Curran as a "super-smart lawyer who understands the technologies that are at the heart of the consumer privacy debate."

Polonetsky added that one of Curran's first orders of business will likely be updating guidelines to take concerns of the FTC and other officials into account. "His primary priority needs to be ensuring that that the NAI standards progress quickly to ensure that ad networks offer consumers more transparency and control over data use and that clear rules are developed to avoid use of sensitive data," Polonetsky said.

Curran worked at AOL for 12 years, most recently as chief counsel for policy and regulatory matters at AOL. Polonetsky recently served as the company's chief privacy officer.

The Network Advertising Initiative formed eight years ago in response to Federal Trade Commission concerns about privacy and then nascent field of behavioral targeting, or tracking people anonymously via cookies and serving ads based on sites visited. The group was supposed to set standards for member companies, and also provide an easy mechanism for Web users to opt out of targeting.

When the NAI was launched, it included some of the biggest companies in the behavioral targeting field. But the dot-com crash decimated the organization, leading privacy advocates to question whether the group could be effective on an industry-wide level when many Web companies did not participate.

In the last few years membership has increased, and the organization now boasts more than two dozen member companies, but some critics say it's too late for the NAI to prove itself. "They're the online ad industry's version of Rip van Winkle," said Jeff Chester, executive director of the Center for Digital Democracy. "The organization simply went into hypersleep for the last six years."