Editorial: Taking StockIn Trade

FTC's Leibowitz recognizes the need to give consumers more control over their online information, but he is not ready to turn the reins over to regulators
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This page frequently covers Federal Communications Commission actions and proposals. But the Federal Trade Commission is getting increased attention in Washington of late, as the issues of online privacy, behavioral advertising, data protection and food marketing grow in importance to media companies now delivering content on multiple platforms, to screens connected to myriad delivery systems.

Thankfully, FTC Chairman Jon Leibowitz appears to “get it.” Perhaps it’s an innate sense of the problems inherent in government trying to mandate technological solutions in a space that moves far faster than regulators can regulate—or enforcement bureaus can enforce, as the case may be. Or maybe it’s related to the administration’s reluctance to throw a wrench into the ad-supported model for free online content.

Once again last week, Leibowitz talked about the need for a balanced approach to online privacy protections. Like everybody else—Republican or Democrat, activist group or industry lobbyist—he recognizes the need to give consumers more control over their online information. But he is not ready to turn the reins over to regulators, or adopt the more stringent restrictions being contemplated in Europe.

Leibowitz was looking to popularize a term, “cyberazzi,” to describe, well…let’s let him describe it. “A host of invisible cyberazzi—cookies and other data-catchers—follow us as we browse, reporting our every stop and action to marketing firms that, in turn, collect an astonishingly complete profile of our online behavior. Whenever we click, so do they.”

Some marketers may take umbrage at that characterization—and Leibowitz was upbraided by one online marketing defender during his National Press Club speech last week that produced this sentiment. But Leibowitz was not trying to say all online marketers are “cyberazzi,” any more than all photographers are paparazzi, or even that paparazzi should be done away with. “Of course, most online advertisers are nothing like paparazzi; many companies have strong privacy policies protecting consumers,” Leibowitz said.

Instead, what he was doing was explaining why the FTC has to pay attention to the issue, while at the same time putting in a plug for self-regulation and the value of targeted advertising. “Many, if not most, consumers prefer targeted ads: Do you really want to scroll through a leggings montage from Forever 21 when you can instead open your computer right to the announcement of L.L. Bean’s annual chinos sale?” the FTC chief said.

Elsewhere on the FTC front, the agency signaled last week that it will signifi cantly modify its food marketing principles in light of stronger self-regs proposed by the industry (see Washington Watch). That includes not casting too wide a net over the programming and Websites classified as targeting children, and thus subject to the guidelines; and not extending covered marketing to teenagers up to 17 years old. “It is often difficult to distinguish marketing designed to appeal to this age group from marketing directed to a general or adult audience,” David Vladeck, director of the FTC’s Bureau of Consumer Protection, said last week. That’s exactly what marketers told the FTC in comments on the guidelines, which will be recommendations to Congress when they are finalized. And the FTC listened.

There are still issues with those guidelines, which marketers would rather see rescinded. But on balance, the FTC has been taking a measured approach to a tricky issue, and recognizing that there are First Amendment issues in regulating or enforcing in that space—even if it could.

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