• by Laurie Petersen , July 24, 2007

Behavioral targeting veterans applauded Microsoft's announcement this week that it would join the Network Advertising Initiative and give consumers the ability to opt out of receiving targeted ads when it starts offering third-party ad serving later this year.

"We've tried to be in front of everyone on this issue," said Curtis Viebranz, CEO of behavioral ad network Tacoda, which has long incorporated an opt-out provision. "It's great to see the big guys following Tacoda."

Jonathan Ragals, COO of 360i, said giving consumers control over their information just makes good business sense, but shouldn't have any major impact for advertisers.

"For consumers," he added, "it's a trade-off between being served information that's potentially more relevant to you versus having control over your privacy and information."

"We will create a privacy experience," said Brendon Lynch, director of privacy strategy for Microsoft, when asked how it plans to communicate its message to consumers. "We will be providing very user-friendly and simple controls."

Microsoft will not begin serving third-party network ads until its acquisition of aQuantive closes. Lynch noted that aQuantive is already a member of the Network Advertising Initiative.

Microsoft's announcement this week was accompanied by a call for industry standards on retaining users' search histories. Following a move already made by Google, Microsoft said it will make search query data anonymous after 18 months by permanently removing cookie IDs, the entire IP address and other identifiers from search terms.

"Something we recognize," Lynch added, "is that customers [need to be] in control of the collection of their personal information. They need to be able to trust us. I think there's been a lot more discussion recently about privacy issues and we saw this as a good opportunity to evolve our policy."

Ask.com last week announced a feature called AskEraser that will allow users to to prevent Ask from retaining any of their search information from the time of a search. Microsoft enlisted Ask.com in its call for standards.

As for Yahoo, it's also moving forward with a new approach to user search data. All search log data will be anonymized within 13 months of collection except where users request otherwise or where Yahoo is required to retain the information to comply with legal obligations.

With regard to its SmartAds and behavioral targeting practices, a user who wishes to remain anonymous to Yahoo can opt to not log in to the network, said Gaude Lydia Paez, director of corporate communications.

"When Google announced its decision to make our logs data anonymous after 18 months, we hoped it would stimulate debate across the industry," said Peter Fleischer, global privacy counsel for Google. "We're delighted it has -- because debate and discussion are good for users. That's why we have made improvements to our policies over the last few months. We'll continue to do so in the future and look forward to working with other companies, regulators and others. Google believes our privacy policy should be based on transparency and user choice -- telling people what we are doing and why so that they can make informed decisions about the services they use."

Search engine pundit Danny Sullivan saw Microsoft's announcement as a PR ploy but said that an industry-wide approach to the issues is long overdue.

Blogged Sullivan: "So many companies today offline (banks, credit cards, loyalty cards, credit reporting agencies) hold much more information about me personally .... Solve the problem whatever it is, in a comprehensive way. If that means better privacy protection, then give it to me across the board."