Federal Trade Commission Endorses "Do-Not-Track" List

Prior to 2004, telemarketers – those pesky sales agents who always seemed to call during dinner – were a major annoyance for many Americans.  These persistent sales people took advantage of telephone service in order to harass offer “spectacular” deals to consumers.  However, Americans soon became fed up with telemarketers and took action to rid themselves of them altogether.  The Do Not Call Registry, which was implemented in 2004, solved this problem of uninvited salespersons by allowing consumers to add themselves to a list, explicitly forbidding telemarketers from calling them.  However, it seems that our problems evolve with time, and in 2010 we are facing a new concern: Internet tracking by advertising agencies.  But if the Federal Trade Commission has their way, a new Do Not Track List would eliminate this modern-day issue as well.

In case you’re unfamiliar with how online advertising works, I’ll give you a quick hypothetical scenario.  Say you visit Site A and view some of their content. Even though you’re likely unaware of it, Site A may be recording your activities on their website – what you search for, what you look at, etc.  Then, Site A will sell this information collected about you (and the rest of their visitor base) and sell it to an advertising agency.  This advertising agency will them composite the information that it gathers about you from Site A and any other participating site that you visit in order to determine what products and services you are likely to purchase.  From there, they will be paid by other companies (the advertisers) to show you ads for products and services relevant to your life; all based on your web activity.

If you have ever searched for a product online only to be bombardered with ads for that product shortly there after, then this has likely happened to you already.

However, a Do Not Track List, as proposed by the FTC would allow individuals to “opt-out” of such tracking in order to protect their privacy.  In an age where people seem to be more and more concerned with privacy, it’s easy to understand why Internet users would be grateful for such an implementation.

I think that everyone would agree that privacy is (and should be) one of our biggest concerns as consumers – especially in the modern world in which we live.  At the same time though, even though I feel there could be great benefit to a tracking opt-out, I also realize that there could be significant repercussions to it.

You see, site owners often contract out advertising on their sites.  After all, by letting the ad agencies handle things, site owners rid themselves of finding and managing advertisers.  As you can imagine, said advertising agencies are really good at what they do, and one of the ways that they are able to be so successful is by targeting advertisements.  You see, someone selling skateboards for example would not want their ad to be displayed to someone in the market for a power wheelchair.  That just wouldn’t make sense, and even though the skateboard shop would be getting impressions, they wouldn’t be very productive in doing so.

By eliminating tracking, advertising agencies would not be able to offer their clients the same return on investment, and would thus end up lowering their prices drastically.  Even worse, they would end up paying less to the producers of a website, ultimately reducing the site’s ability to operate and produce content.  In the long run, this could lead to more sites producing paid-only content, or worse; closing down their operations altogether.

At the end of the day, we really have to ask ourselves what we want; privacy or content.  Would you rather have free content by allowing some of your browsing trends to be made available, or would you rather keep complete control over your privacy even if it meant sacrificing the content available to you?  What it really comes down to is a matter of personal opinion and preference, and for this reason I am anxious to see what the future holds in this issue.

What’s your opinion on this issue?  Would you opt-out of online tracking?  Do you think it would hurt websites?  Let us know in the comments!