The commissioner of the Federal Trade Commission said Thursday that the agency would be exerting a tighter grip over online advertising.
Commissioner Jon Leibowitz said he was concerned about ads being shown to children on the Internet and about tactics that advertisers are using to collect data about Web surfers.
"When you're surfing the Internet, you never know who is peering over your shoulder or how many marketers are watching," he said.
Leibowitz spoke at the FTC's two-day forum on behavioral targeting, a method that delivers ads to people online based on what Web sites they have visited. Privacy advocates and executives from companies like Google Inc. and Microsoft Corp. spoke on panels, debating the tradeoff between keeping people's personal information private and the desire to collect people's data to deliver relevant ads to them.
Leibowitz said that rules about sites' privacy policies may need to be established. He pointed to a study that found that people with a high school education can easily understand only 1 percent of the privacy policies of large companies. He also noted that none of the companies in the survey made targeting an opt-in decision; he suggested that more policies should be opt-in.
"People should have dominion over their computers," he said. "The current 'don't ask, don't tell' in online tracking and profiling has to end."
But some people from the online industry said the FTC should stay out. Randall Rothenberg, president and chief executive of the Interactive Advertising Bureau, said the FTC should not regulate online advertising because it could limit what he called a recent "extraordinary pattern of innovation."
Leibowitz spoke briefly about the commission's ongoing evaluation of the proposed Google deal to purchase DoubleClick, an Internet ad delivery company. The FTC is determining whether the deal would have anti-competitive effects, not how it would affect privacy online. He would not comment on whether he thought the deal would gain approval, but he said that either way it was clear that the FTC needed to increase scrutiny of online targeting industrywide.
Google's deal to purchase DoubleClick for $3.1 billion was just one of many acquisitions in online space over the past year. Microsoft acquired aQuantive for $6 billion, the Publicis Groupe bought Digitas for $1.3 billion, Yahoo paid more than $680 million for Right Media, an ad exchange, and AOL spent a reported $275 million for Tacoda, an ad network.
With all these deals comes more pressure to generate more money through online advertising, Leibowitz said.