U.K. Government Body to Investigate Behavioral Targeting

The U.K. government’s consumer protection body, the Office of Fair Trading (OFT), has announced an investigation into the use of behavioral data for tailored online advertising and pricing. In addition, it will seek to examine current opt-in mechanisms related to the collection of user information and data, and its syndication with third parties.

The office is currently seeking input from stakeholders and trade bodies on the possible scope of the study, and says it is scheduled to launch officially in the autumn of this year.

According to an announcement on the OFT Web site, possible outcomes of the study could include encouraging an industry code of practice, making recommendations to government and regulatory bodies, and even taking legal action against firms suspected of breaching current consumer law.

The U.K. IAB has been upping its efforts in the regulatory space since it appointed Nick Stringer as its first head of regulatory affairs in April last year, and the industry body released its own “Good Practice Principles” surrounding the collection of behavioral data earlier this year.

In reference to the investigation, Stringer told ClickZ, “The OFT has not finalized the scope of its study yet and we will — initially — respond to its Q&A and highlight the ongoing work the IAB and its members are doing on online privacy and behavioral advertising, specifically the IAB Good Practice Principles.”

In reference to the suggestion that investigations such as this could indicate the IAB’s work in the area is not being recognized, or deemed sufficient by government departments, Stringer added, “No, I don’t think so. The IAB’s work was specifically highlighted in the government’s final digital report in June and is supported by the Information Commissioner’s Office, Ofcom and other industry groups.”

Outside of the U.K., E.U. regulators have repeatedly expressed interest in closer regulation of the online ad space, particularly in relation to the collection of user data. Delivering a keynote speech at an E.U. roundtable event in Brussels in April, the European Commission’s consumer affairs commissioner, Maglena Kuneva, said the industry risked formal legislation if they failed to clean up their act, stating, “If we fail to see an adequate response to consumer concerns on the issue of data collection and profiling, as a regulator we will not shy away from our duties nor wait for a cataclysm to wake us up.”

Speaking with ClickZ in Brussels earlier this year, Alain Heureux, President of pan-European industry body IAB Europe, said his organization was now focusing the majority of its time and resources on matters of regulation in attempt to stave off such legislation. “We need to convince [European lawmakers] that self-regulation is the way forward. You cannot regulate an industry that is growing and moving so quickly that way,” he said.