It's doubtful that -- between managing two wars and implementing a massive economic stimulus package -- behavioral targeting ranks high on President-elect Obama's first 100 days' to-do list.
Yet, with a new administration set to take charge this week, backed by a larger Democratic congressional majority, the online ad industry is swiftly moving to present itself to Washington as a business that can police itself.
Thus, when a coalition of the marketing world's largest trade groups formed last week to announce plans to develop a set of self-regulatory guidelines for behavioral targeting ads, the timing seemed deliberate, and the message clear: you don't need to handle this, we're on top of it.
The American Association of Advertising Agencies, the Association of National Advertisers, the Direct Marketing Association, the Interactive Advertising Bureau and the Council of Better Business Bureaus, pledged to tackle privacy concerns over just how consumers' Web searching and surfing data is used by marketers. IAB president and CEO Randall Rothenberg said the timing of the announcement was coincidental, as planning for this coalition has been in the works ever since Google acquired DoubleClick back in 2007.
But consumer-advocacy groups charge that the coalitions' announcement was panic driven. "The industry's response was about dodging a regulatory bullet," said Jeff Chester, founder and executive director of the Center for Digital Democracy. "They are very concerned that they'll lose self-regulation [as a tactic]. The industry blinked."
Rothenberg bristled at hearing Chester's comments, adding that groups like the CDD are "very paternalistic. They think that Americans are sheep and they need a protector."
Yet Rothenberg did acknowledge that his biggest fear is that a new administration might bow to increased pressure from such groups and enact a piece of legislation similar to the bill introduced last March by New York State assemblyman Richard Brodsky, which in Rothenberg's mind was so severe it would essentially prohibit all forms of ad targeting. "That would regulate the Internet out of business," Rothenberg said. "If you do what advertisers have been doing for hundreds of years, you'd be wrong [under this sort of law]. It would be like asking the New York Daily News to put out an edition with no ads"
The industry has several factors working in its favor. For one, it's been working closely with the Federal Trade Commission, which in late 2007 issued a draft set of self-regulatory guidelines for behavioral targeting, with final guidelines due shortly. "It's likely that we are going to continue to advocate for rigorous self regulation," said Mary Engle, the FTC's associate director for advertising practices. However, the FTC is currently without a chairman, a position that, based on past history, can take months or years to fill (although Obama has been filling such posts rapidly). And Obama's choice last week for Federal Communications Commission head, Julius Genachowski, is encouraging to the online ad world, since he's a former exec at IAC and would seemingly grasp the intricacies of Internet advertising.
The fact that the famously BlackBerry-wielding Obama's campaign had so much success marketing and fundraising on the Web would seem to bode well for the industry, as many doubt the President-elect would want to drop the hammer on companies that helped put him in office. Plus, he's sort of busy.
Still, to avoid a worst-case scenario, the ad industry must act swiftly and collectively, said Rothenberg. "This is everybody's issue. We've just got to get ahead of this. We have no choice."
Mike Shields, Adweek. January 19, 2009
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