Shunned Profiling Technology on the Verge of Comeback
One of the most potentially intrusive technologies for profiling and targeting Internet users with ads is on the verge of a comeback, two years after an outcry by privacy advocates in the U.S. and Britain appeared to kill it.
Context & Ripple Effects
Online ad profiling had already drawn formal scrutiny when groups asked the FTC to investigate online ad profiling in 2006. By 2010, the industry was testing a “You Are Being Targeted” disclosure icon rather than abandoning behavioral targeting outright.
The return of a previously protested profiling approach lands as online privacy was moving toward a broader policy showdown. It tests whether notice-based self-regulation can defuse objections from U.S. and British privacy advocates.
First-order effects
- Privacy advocates in the U.S. and Britain must again contest an advertising practice they had helped push out of favor.
- Advertisers and the companies serving targeted ads regain a route to more granular audience segmentation, subject to renewed privacy scrutiny.
Second-order effects
- The advertising industry’s targeting-icon experiment becomes more consequential: a disclosure mechanism may be used to argue that profiling can proceed with notice rather than prohibition.
- The FTC faces renewed pressure to determine whether industry-led disclosures adequately address the profiling concerns raised in the 2006 complaint.
Third-order effects
- If notice-based targeting becomes the accepted compromise, online advertising will increasingly treat data collection as permissible when paired with user-facing disclosure rather than meaningful limits on profiling.
- The dispute points toward privacy governance centered on the boundary between data available for targeting and data users reasonably expect not to be repurposed.
The trend: Online advertising is shifting from outright resistance to behavioral profiling toward disclosure-based self-regulation amid escalating privacy-policy pressure.