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Opt In Legislation Coming: Not Good for Targeting

Opt In Legislation Coming: Not Good for Targeting

Reacting to the responses from Internet companies and ISPs about behavioral targeting practices, Congress members expect to introduce legislation next year requiring companies to get approval from people before they collect data, reports the Washington Post.

That’s a big deal. Whether it will go through is another issue. And whether it will cover deep packet inspection or the behavioral targeting offered by companies like Yahoo and Microsoft is yet to be worked out, says Congressman Edward Markey’s office. But up until now the standard generally for data collection has been opt out. Though it hasn’t been applied to behavioral targeting by the big companies until the past year, when Microsoft, Google, and Yahoo began providing the option.

Opt in, though is a much bigger barrier to overcome.

It’s clear from the purchases that companies have made this year that behavioral targeting figures high among their future plans for growth. During the past year, Microsoft snapped up aQuantive, Yahoo bought BlueLithium, Google purchased DoubleClick and AOL bought Tacoda. The segment is expected to increase 48% this year to $775 million, or 8% of the display ad market. By 2012, it’s expected to bring in $4.4 billion in 2012 in revenues, or 23% of the display market, according to eMarketer.

Opt out in optimal for companies because most people don’t do it. As we wrote on Friday, in July, Yahoo said that 75,000 users—a fraction of 1% of the traffic it sees on its network—visited an opt-out page to refuse behaviorally targeted ads across the non-Yahoo sites on which Yahoo serves ads.

The companies believe that that is because most people actually like targeted ads. But it could also be that most people don’t understand the kind of targeting that’s going on. Because it surveys when they are asked about it, they don’t like being targeting. In a survey released this spring by TRUSTe, a privacy policy accrediting group, 57% of the 1,015 respondents said they weren’t comfortable with advertisers using that browsing history to serve relevant ads.