A Time Warner Cable executive warned legislators Thursday that an online 'Do-not-track' regime could have unintended and negative consequences, not only on targeted online advertising, but on the diverse and unique Web sites such ads support.
But Joan Gillman, executive vice president of media sales for the cable company, said that if that regime becomes a reality, it needs to apply to all parts of the Internet ecosystem.
Her remarks came during a hearing in the House Energy & Commerce Committee Consumer Protection Subcommittee Thursday on possible online 'Do not track" legislation.
Asked what the economic impact of do-not-track would be on her company, Gillman said she did not have specifics, and broadened the answer beyond economics. "The risk one runs is that there are unintended consequences of a do-not-track policy in that it prevents companies like ours from innovating." In addition she said, the "vibrancy" Internet could also be at stake.
What should be explored, she said, were the consequences on smaller content providers and service providers, "the small businesses in and around this ecosystem." She said that, "the smaller the Web site, the smaller the audience," the more difficult it is to rely on contextual advertising. Those would be the ads directly related to the ones on a site being visited.
Gillman said do-not-track should not be considered in a vacuum, but needs to be part of a larger conversation about consumer privacy. She said a do not track bill would be premature, and that industry "best practices" self-regulation was the preferable next step. In an earlier panel, representatives of both the Federal Trade Commission and National Telecommunications & Information Administration agreed that self-regulation was preferable, but also agreed among themselves that, to date, it had fallen short. But neither pushed for legislation, rather they urged industry to step up and do more.
She noted that advertising was a key driver of online applications at "little or not cost," and that the more effective the ad is, the more revenue there is to fund those services. "Simply put, advertising is more effective if the message is more relevant," she said.
"Do-not-track raises unique issues, she said, that make it more complicated than the do-not-call list for telemarketing. "For instance, she asked, "How would do not track affect consumers online experience and expectations? would they receive more pop-up ads? How would it affect diversity on the Internet? Would it negatively impact niche Web sites with small but loyal audience? Would it prevent new Web sites from launching?"
Taking aim at the suggestion of all those potential complications was Eben Moglen, Columbia law professor and Sofware Freedom Law Center Founder, who also likened data trackers to spies and suggested they should be treated as such.
"I think the attempt to connect the advertising business model to the importance of vibrant content on the net or life-changing possibilities of expansion of access to underserved populations is poppycock.," said Moglen, drawing some laughter from the hearing audience. He said that the purpose of advertisers was to "collect information concerning the capabilities of the potential buyer and to affect that buyers behavior. That is also the definition of what intelligence services do."
Susan Grant, director of consumer protection at the Consumer Federation of America, suggested that do not track would not somehow mean the end of the online ad model that supports all that free and diverse content.
"We're not talking about no advertising," she said. "There are consumers who might not avail themselves of do not track so would continue to receive tailored advertising. There are consumers who now and continue to get contextual advertising, which is based on what they are looking at the time on the Internet, and doesn't involve following them around and compiling a dossier of what they do and who they talk to. And consumers find information on the Internet about the products and services that they want in other way as well. They do it using search engines and price comparison web sites. Behavioral advertising is one part, and I don't think that doing away with it [she stopped herself and amended the statement] or, not doing away with it, but giving consumers control over whether they want to be tracked or not, will create a great economic upheaval or turn the Internet dark overnight.
Mogen agreed. Pointing out that there was already ad-blocking browser software available and that "civilization had not collapsed," hesaid there was "no justification to conclude that "legitimate control of surveillance on the Web in the public interest would have any effect on the economics of the situation."
The issue of do-not-track has been heating up lately, with the FTC releasing its advisory report recommending some kind of online "do not tracking regime, though one preferably imbedded in a browser rather than a database like the "do not call" list for telemarketers.
The subcommittee is chaired by Bobby Rush (D-Ill.), who introduced an online privacy bill in July that would require a combination opt-in and opt-out regime for online data collection, similar to the proposals in the FTC report. But it did not include a do-not-track element.
Rush's bill was in part a reaction to changes to Facebook privacy settings and the collection of data from WiFi networks by Google Street View cars.