Internet Business: Congress to Push Web Privacy

The head of the House Energy and Commerce Committee Washington Representative Edward Markey along with other representatives are planning to introduce comprehensive online privacy legislation. The law is aimed at protecting consumers’ online privacy.

Named the Online Privacy Bill of Rights, this law requires companies to get approval from consumers before collecting information about their internet surfing habits. This is a process known as behavioral targeting that helps Websites strategically place ads. The law would also demand that companies disclose more information on their collection and use of people’s data.

There is a reasonable chance that we will see something in the next Congress," says Michael Hintze, an associate general counsel at Microsoft (MSFT).

Watching what you watch

Ad targeting drew the interest of legislators amid recent hearings over NebuAd. NebuAd is a company that makes devices that attach to the networks of Internet Service Providers and log surfers’ movements. Lawmakers are looking at the implication of this new technology known as deep packet inspection. This technology is one of the most comprehensive ways of keeping track on what people do online.

An examination of NebuAd drove congressional staffers to look at ad targeting more broadly. Markey’s committee on Aug.1 sent letters to 33 companies asking each to outline its tracking practices. Among these companies are Google, Microsoft and Yahoo.

Behavioral targeting for consumers

Behavioral targeting has risen in the past years as companies made more powerful ways of searching through data. Internet companies have propped up their ability to target ads through getting large ad networks able to gather their own information on consumers’ site-viewing habits.

In the past year, Google purchased Double click, Yahoo bought BlueLithium, and Microsoft acquired aQuantive. The use of ad networks increased from 5% to 30% in 2007.