Google, NebuAd, and Others Support IAB U.K. Behavioral Guide

The Internet Advertising Bureau U.K. has today launched a good practice principles guide for firms that collect and use data for online advertising. The goal is to promote self-regulation of the practice and quell privacy concerns surrounding it. Companies that support the principles include Google, Microsoft Advertising, Platform-A, Yahoo, Specific Media, Audience Science, NebuAd, and Phorm, all of which have been involved in the formation of the principles as members of the IAB’s behavioral advertising task force.

To complement the guide, the IAB has also launched a consumer-facing site, youronlinechoices.co.uk, designed to educate consumers on how and why their data is being used, and to provide information on how they can opt out of the process if they wish.

“Given the understandable concerns of consumers about the extent to which their online activity is monitored and the importance of consumer trust, a joined-up approach to promoting transparency, choice and education makes good sense,” stated Phil Jones, director of data protection practice for the U.K’s independent data protection regulator, the Information Commissioner’s Office, in an IAB press release.

The guidelines themselves center around three core commitments, to which signatories will have six months to comply with. During this time, the IAB will put together policies and procedures to manage compliance and handle consumer complaints.

Companies engaging in the collection of behavioral data, including publishers, networks and technology firms, must “clearly inform” users that they are doing so.

Secondly, companies must then provide a mechanism through which users can opt-out of receiving behavioral advertising, and “where applicable seek a consumer’s consent.” For example, U.K. regulatory body, the U.K.’s Department for Business, Enterprise and Regulatory Reform (BERR), has concluded that Phorm’s technology must receive consumer opt-in prior to any user data being analyzed.

Finally, companies must provide consumers with “clear and simple information about their use of data,” and details of how users can decline the advertising if they wish.

Although many of these firms have been making use of behavioral data for some time, Phorm caused controversy last year when it announced it was partnering with ISPs to gather this information. Privacy advocates argue that using ISP data, rather than on-site behavior, breaches privacy and data protection rights. As a result, the practice garnered attention throughout 2008 from both the media and government regulators alike.

Speaking with ClickZ News in November, the IAB U.K.’s head of regulatory affairs, Nick Stringer, said the industry needed to react positively to the attention it was receiving. “Online advertising needs to grow up as a sector; we shouldn’t shy away from these industry challenges. We need to understand them, and we need to address them,” he said.

Although the ICO seems content with the IAB’s self-regulatory efforts at this stage, privacy advocates are unlikely to view the principles as sufficient, given that many still contest the legality of the practices being proposed by ISP-based ad targeting firms such as Phorm. Indeed, the legality and morality of some forms of behavioral data collection are still the subject of ongoing debate. In addition, European regulators have expressed concerns of their own. E.U. Information Commissioner, Viviane Reding, has been in dialogue with the BERR regarding behavioral ad practices and their potential legal ramifications.

Meanwhile in the U.S., the FTC seems less convinced by the industry’s ability to self-regulate, and hinted last month that further regulation and legislation may be in the pipeline.