Online Marketers Joining Internet Privacy Efforts

Most consumers are familiar with do-not-call lists, which are meant to
keep telemarketers from phoning them. Soon people will be able to sign
up for do-not-track lists, which will help shield their Web surfing
habits from the prying eyes of marketers.

Such lists will not reduce the number of ads that people see online,
but they will prevent advertisers from using their online meanderings
to deliver specific ad pitches to them.

Today the AOL division of Time Warner will announce a service of this
type, which will be up and running by the end of the year. Other
programs are likely to be articulated soon, as online advertisers
prepare for a two-day forum on privacy to be held by the Federal Trade
Commission.

AOL says it is setting up a new Web site that will link consumers
directly to opt-out lists run by the largest advertising networks. The
site's technology will ensure that people's preferences are not erased
later.

There is a silver lining for marketers, however: the AOL site will try
to persuade people that they should choose to share some personal data
in order to get pitches for products they might like. Most Web sites,
including AOL, already collect data about users to send them specific
ads — but AOL is choosing to become more open about the practice and
will run advertisements about it in coming months.

Consumers who have already seen some benefits from online tracking
systems — in the form of movie recommendations from Netflix, perhaps,
or product recommendations from Amazon — might warm to AOL's argument.

"Instead of having interruptive ads, instead of jarring things that
will grab your attention, things are hopefully tailored to be suitable
to your experience," said Jules Polonetsky, the chief privacy officer
for AOL. "We think tailoring advertising content in a way that is
useful is a good proposition."

Whether consumer privacy groups and other advertising companies agree
with AOL's philosophy will become clearer tomorrow and Friday at the
event put together by the F.T.C., the agency that monitors advertising
for deceptive and unfair practices. The gathering will feature privacy
officials from Google, Yahoo, AOL and Microsoft, as well as experts in
the field of behavioral targeting, which is the delivery of ads to
people based on their online habits.

Advertising companies fashion their behavioral targeting models
differently, but generally the practice involves linking demographic
information and Web site visits. Under the practice, people who read
articles about babies would receives ads for baby gear even when they
move on to read articles about stocks, for example. Much of the
information is gathered anonymously, without links to people's names.

Consumer advocacy groups have in the past asked the F.T.C. to set up
some kind of do-not-track list for the Internet, but the commission
has been hesitant to issue regulations that might slow innovation on
the Web, said Eileen Harrington, deputy director of the agency's
Bureau of Consumer Protection.

"We all love the Internet, and the last thing we want to do is suggest
that the government would step in here in a way that would take that
away from consumers," Ms. Harrington said. "We haven't reached
conclusions on any of these questions. The big news here for us is —
and maybe it seems obvious when you say it fast — is that advertising
has changed dramatically."

Since 2004, companies have more than doubled the amount they spend on
ads on the Internet, shifting that money away from more traditional
outlets like television, radio and print publications. Companies will
spend $20 billion this year on Internet ads, the Interactive
Advertising Bureau, a trade group of Web publishers, estimates.

The growth has been fueled in part by technologies that enable
advertisers to use data about consumers on the Internet in ways that
were not possible in older media. Traditionally, viewers and readers
have been shown the same ads in the same places at the same times, no
matter their age, gender or interests. Advertising was designed for a
mass audience, leading to decades of water-cooler humor about that
funny commercial last night, shown to everyone who tuned in.

But to many consumer brand companies, making different ads for
different people is a better way to reach prospective buyers — and the
Internet captures enough data for them to do so.

AOL executives say they are happy to give people a way to keep their
Internet habits private, even though that would undercut AOL's own
behavioral targeting efforts. In July AOL acquired a behavioral ad
network company, Tacoda, that has been promoting opt-out options to
users for a year.

"We all have to build toward a future where we are delivering ads
people want and not just ads we want people to see," said Dave Morgan,
the founder of Tacoda who now works at AOL. "The only way to do that
is to listen to consumers."