FTC Reviews Complaint About Online Marketers' Targeting Practices

Privacy Groups Aim to Attract Attention of Two Incoming Commissioners

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NEW YORK (AdAge.com) -- The Federal Trade Commission today told privacy groups it is "carefully reviewing" their complaint that the commission should investigate the targeting practices of online advertisers.

The Center for Digital Democracy, U.S. PIRG and World Privacy Forum filed its complaint with the Federal Trade Commission today, asking it to investigate the advertising exchange systems of Microsoft, Google, Yahoo, as well as others. Marketers are increasingly relying on auction and exchange systems, which can more accurately and more quickly target users by profiling their surfing and buying habits.

The complaint comes as two incoming commissioners give the FTC a new makeup and could affect the outcome of online privacy debates now gaining traction in Washington.

The FTC said it is "carefully reviewing" the complaint, citing that the concerns of the consumer groups overlap the agency's "ongoing work to examine and address behavioral advertising issues."

'Anti-media effort'
"This is couched in the name of privacy but it's an anti-media, anti-advertising effort," says Stuart P. Ingis, partner at Washington law firm Venable and counsel for a broad coalition of advertisers, including Microsoft, Google and Yahoo. "It's a lot of rhetorical concern."

Indeed, such complaints have circulated since the dawn of the internet and have gone unnoticed by those in charge. But the rub this time is that the Obama White House recently appointed two new commissioners to the FTC, Julie Brill, who most recently served as deputy attorney general for consumer protection and antitrust for North Carolina, and Edith Ramirez, a partner at Quinn Emanuel Urquhart Oliver & Hedges in Los Angeles. These two appointees give the Democrats the majority on the FTC for the first time under the new administration.

"Given the new makeup of the FTC, we expect they'll give us a sympathetic response to our complaint," said Jeffrey Chester, executive director of the Center for Digital Democracy. Mr. Chester admitted he waited to file the complaint after the addition of the two Democrat commissioners.

Mr. Ingis acknowledged the FTC's new makeup will certainly open the debate over privacy with regard to behavioral advertising, but he is not concerned the commission is biased either way.

"Both of the new commissioners are clearly very qualified," he said. "Of course we should be debating information policy."

The FTC, meanwhile, would not comment on the timing of the complaint or the new appointments. Separately, the government agency is currently considering another high-profile issue: Google's $750 million acquisition of Ad Mob.

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