User Empowerment, Not Regulation, Is The Answer to Privacy Concerns About Targeted Ads
Q: What is the Progress & Freedom Foundation?
PFF is a market-oriented 501(c)(3) think tank founded in 1993 and based in Washington, D.C. that studies the digital revolution and its implications for public policy.
Q: Why do you favor user empowerment over regulatory solutions to concerns about online privacy?
We argue for user empowerment over restrictive defaults (like "opt-in") for data use and collection because, as the Supreme Court held in 2000: "Technology expands the capacity to choose; and it denies the potential of this revolution if we assume the Government is best positioned to make these choices for us."
We promote tools that let users make their own decisions about privacy, not only because those decisions are fundamentally subjective, but because regulatory mandates could stifle the development of online content and commerce.
Q: In areas other than privacy, where has your education of the regulators and industry resulted in less restrictive alternatives than legislation in favor of user empowerment?
Since 1997, the Supreme Court has struck down multiple legislative attempts to censor online and offline content because there were "less restrictive alternatives" that would not so heavily burden free speech rights. In a 2000 cable-related decision, the Court held that "targeted blocking [by users] is less restrictive than banning, and the Government cannot ban speech if targeted blocking is a feasible and effective means of furthering its compelling interests."
Courts have struck down other federal and state speech controls because parents had the tools to filter their kids' access to information online, in video games, etc., as described in my PFF colleague Adam Thierer's ongoing catalog of these tools.
Q: Are there "less restrictive alternatives to legislation" for the privacy debate? How can industry do more to empower users?
Our ongoing Privacy Solutions Series describes the many tools currently available to users to manage their privacy online-starting with the cookie controls in all browsers. If anything, these tools work better than parental control tools because "targeted blocking" of tracking cookies, etc., is simpler than filtering content parents might find objectionable.
The advertising industry can and should do more to disclose their data use and collection practices to users, especially by using machine readable disclosures to make "targeted blocking" easier for users. But under the current "No-Cost Opt-Out," such empowerment simply makes it easier for a minority of privacy-sensitive users to free-ride off the enormous economic value created by users who don't opt-out.
Ultimately, it may be necessary to make explicit today's implicit quid pro quo of free content for services: If users actually faced a trade-off between not being tracked and getting more free content (e.g., seeing fewer, but better-targeted ads), privacy-sensitive users would have an incentive to engage in "targeted blocking." We'd probably see that most users probably just aren't as bothered by being "tracked" as privacy elitists insist they should be.
Q: What showing of harm has been used to justify regulating online data use and collection for advertising, and is that showing strong enough?
Regulations that burden speech must address "real, not merely conjectural" harm. No such showing has been made to justify the "techno-panic" about online privacy. The discomfort some "privacy advocates" feel about "online tracking" doesn't give them the right to impose their preferences on everyone else.
Q: Is advertising a form of free speech and what precedent does that set?
Absolutely. In 1980, the Supreme Court recognized that the First Amendment protects advertising that is not truthful or misleading. Unfortunately, the Court invented a double standard: The government can more easily justify regulations of "commercial speech" (which does "no more than propose a commercial transaction") than of "non-commercial speech" (political and non-profit messages).
Even as the Court has moved away from this distinction in theory, it has become unworkable in practice: Non-commercial speech is increasingly carried by commercial speech platforms like ad networks and social networks, so the approach of past laws (simply exempting non-commercial websites) won't work in an era of technological and platform convergence. Regulations on data use and collection that burden all speech carried by ad networks must yield to "less restrictive means" like opt-out, user empowerment, and FTC enforcement of privacy policies and self-regulation.
Q: What is privacy elitism and what are its parallels in the free speech debate?
Many who oppose industry self-regulation are not really "consumer advocates" because they don't recognize that consumers have many, competing values. Those regulatory advocates are more interested in their preferred one-size-fits-all mandates than in empowering users to determine their own privacy preferences.
Like advocates of censorship, privacy zealots assert great dangers to which citizens are supposedly oblivious but which urgently require government intervention-dismissing arguments to the contrary as either uninformed or irresponsible.
Q : Privacy elitists typically claim the high ground in terms of motives: privacy elitists holy, advertising bad. What are the implications of this?
Privacy elitists suffer from what philosopher Thomas Sowell has called the "Vision of the Anointed." For them, Privacy (with a capital-P) is essentially the same for everyone and there are no trade-offs. They want to impose their preferences on the rest of us, regardless of the consequences.
Q: This type of debate has raged on before in other industries. What is the closest analogy?
Increased liability threatens the advertising industry on many fronts. But the most striking parallel to the fight over targeted online advertising is the effort by several states to restrict or ban targeted advertising of pharmaceuticals to doctors ("detailing").
We've joined the fight against those laws and hope the Supreme Court will soon recognize that all regulations on targeted advertising must yield to "less restrictive means."