Proposed COPPA Regs Could Knock Ad Networks Off Kids' Sites

If the Federal Trade Commission wants to ban companies from using behavioral advertising techniques on children, the agency should try the direct approach. That's according to the think tank Future of Privacy Forum.

“The straightforward way to regulate the ability of operators to target children with behavioral advertising would be to simply prohibit operators from engaging in the practice,” the think tank says in written comments regarding a proposed update to the Children's Online Privacy Protection Act. “But the FTC instead focuses on the types of information operators collect rather than on how operators use the information. This approach unnecessarily risks imposing COPPA’s notice and consent requirements on those operators who use information in ways that do not raise significant privacy concerns.” 

COPPA, passed in 1998, prohibits Web companies from knowingly collecting "personal information" from children without their parents' permission. The statute defines personal information as names, telephone numbers and street addresses, but the statute also enables the FTC to define the term as any identifier that “permits the physical or online contacting of a specific individual.”

The FTC recently proposed including any unique identifier -- including tracking cookies, device serial numbers, and in some cases, IP addresses -- within the definition.

Doing so, says the industry-funded Future of Privacy Forum, could effectively prevent sites geared toward children from selling any space to ad networks, which often set cookies simply to count the number of people who view an ad, or for frequency capping. “The proposed changes to the rule would treat this collection of non-personal information as personal and thus bring to a halt the basic information collection relied on by advertisers and web publishers for basic understanding of their ad campaigns,” the Future of Privacy Forum argues.

Jules Polonetsky, co-chair of the organization, says that the FTC could instead define personal information as data collected and used for purposes of behavioral advertising -- or sending ads to users based on sites they previously visited. 

The Future of Privacy Foundation is hardly the only group to take issue with the FTC's proposal. The Interactive Advertising Bureau also opposed broadening the definition of personal information.

Other business and industry groups, including the American Association of Advertising Agencies, American Advertising Federation, Association of National Advertisers, Direct Marketing Association, Magazine Publishers of America and U.S. Chamber of Commerce, also weighed in against the proposal.

Public interest groups and privacy advocates including the Center for Digital Democracy, American Academy of Pediatrics and World Privacy Forum, mostly praised the proposal.

Facebook, meanwhile, addressed what's become known as the “nym” wars -- or the battle over online anonymity. The company reiterated its stance against pseudonyms. “We always have believed that people online are more likely to adhere to community rules and less likely to engage in negative, dangerous, or criminal behavior when their real-world friends and families surround them,” Facebook wrote. “A culture of authentic identity also makes our service less attractive to predators and other bad actors who rarely use their real names and email addresses when engaging in nefarious activity.”