Lawmaker Questions Ad Industry's Do-Not-Track 'Loopholes'

by Wendy Davis, May 9, 2012, 6:56 PM

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The chairman of the Senate Commerce Committee repeated his call for new online privacy laws at a hearing on Wednesday afternoon.

"I have learned over many years that self-regulation is inherently one-sided," Sen. Jay Rockefeller (D-W.Va.) said in his prepared introductory remarks. "I believe consumers need strong legal protections. They need simple and easy to understand rules about how, what, and when their information can be collected and used."

Rockefeller, who introduced a do-not-track bill last year, added that there is no "significant consensus" yet on possible measures.

In an exchange with Federal Trade Commission chairman Jon Leibowitz, the senator expressed doubt about whether the self-regulatory group Digital Advertising Alliance will be able to protect consumers' privacy. "Sometimes industries' self-regulatory efforts do not end up protecting consumers," Rockefeller said. "In my experience, corporations are unlikely to regulate themselves out of profits," he added.

Leibowitz said the DAA has "made meaningful progress" toward implementing one of the FTC's recommendations -- a universal, easy to use do-not-track mechanism. In February, the DAA said it would require members to honor browser-based do-not-track headers, but the details are still being worked out. "I do think do-not-track will be available for consumers, one way or another, by the end of the year," Leibowitz said.

But Rockefeller questioned whether the DAA's approach would "allow rather large loopholes."

Leibowitz responded that one of the key issues surrounding do-not-track is how much data companies will be allowed to collect data from users who have activated a do-not-track setting. Leibowitz said that do-not-track should mean "do not collect," but allowed that there can be "a few enumerated exceptions."

For instance, he said, companies might be allowed to collect data for anti-fraud purposes, or to limit the number of times that users see ads, even when users have activated do-not-track. But allowing companies to collect data for purposes of market research could prove problematic. "You certainly don't want a loophole that swallows up the commitment," he said.

Not all lawmakers agreed with Rockefeller. Pat Toomey (R-Penn.) said he was "skeptical" about whether new laws are needed. "It seems to me that neither this committee, nor the FTC, nor the Commerce Department fully understand, what consumer expectations are when it comes to their privacy," he said.

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