Turow Berkeley Study: Consumers have a Bad Attitude about Behavioral Ads

Prof Turow’s study of consumer attitudes toward behavioral advertising reported in the NY Times today is a severe indictment of the current state of behavioral advertising. Consumers just do not like the feeling of being tracked. What can companies do about it? How about take Turow’s advice! Despite the significant concerns captured by the poll, Turow says: “I don’t think that behavioral targeting is something that we should eliminate, but I do think that we’re at a cusp of a new era, and the kinds of information that companies share and have today is nothing like we’ll see 10 years from now. He would like “a regime in which people feel they have control over the data that marketers collect about them. The most important thing is to bring the public into the picture, which is not going on right now.”

We think there is a very short window of time for businesses to put users in charge and shift the debate to which site or ad network best helps you tailor your own experience to your preferences or provides the best offers.The only way to turn this debate around is to lean in to the issue and provide users with real transparency and real user control.

What’s the first step you can take? Let consumers know what is going on in an open and honest way. If you are a business involved in behavioral advertising, contact us ASAP to join our effort to design icons and symbols that can be used to let users know how you and your ad network or re-targeting partners are tailoring ads to consumers.

In Trust We Trust

Business Week’s cover story this week is about a commodity that many businesses don’t seem to have in abundance these days: trust. Only 44 percent of Americans in a recent public survey said that they trusted business, the lowest rating since 2001. According to BW, that’s led to some serious soul-searching in corporate America:

Not long ago, trust and reputation were the domain of the  PR department. Marketing executives, by contrast, pushed products and brands…. That approach doesn’t work so well now—and not just because recession, job insecurity, and hammered home values have made consumers disinclined to part with their coin. The days of consumers passively absorbing a TV commercial—or, for that matter, a banner ad—are over. People research purchases as never before, and they read peers’ opinions about brands and products.  [Emphasis ours]

Business Week’s article focuses on companies like Ford, McDonalds and American Express and their efforts to be more transparent and responsive to the concerns raised by consumers and advocates.

It’s easier than ever for consumers to switch brands – or avoid purchases altogether – which is why businesses need to focus on all aspects of the consumer experience, not just customization or value.

As the article notes, trust has moved back to the top of many corporations’ outreach efforts. Yes, that means such things as stressing quality and new technology, but it also means responsible use of consumer’s personal information. As headline after headline has shown, there are few better ways for a company to undermine trust than to act cavalierly with its users data.

Many businesses have responded to their awareness of the key role privacy plays in ensuring trust by appointing a senior level chief privacy officer to help oversee their practices. Across almost every business sector, the International Association of Privacy Professionals now reports 6000 members. Oddly, one sector which makes robust use of consumer data is underrepresented. The major advertising agencies, charged with protecting and enhancing the brands of their clients and often delving deep into consumer data use to do so, do not appear to be active in privacy circles.  WPP has a senior executive charged with privacy; the others surely are aware of the proliferating privacy issues today, and it would be in their interest to be more visible, one would think.

AS BW makes clear, engaging users and critics before they blog, Facebook and Twitter their gripes to the world is smart business and key to maintaining a trustworthy brands. The ad agencies charged with responsibility for those brands would do well to recognize the importance of trustworthy data practices to the success of those brands.

Kudos to Rebecca Herold on Smart Grid Work…

Rebecca Herold, the newest member of our smart grid privacy working group, was a lead drafter of the Smart Grid Privacy Impact Assessment released today by NIST. At her site, she provides some of the background to the drafting process, and includes some key material that didn’t make it in to the final document. Kudo’s to her for some groundbreaking work. Follow Rebecca @PrivacyProf on Twitter for great privacy commentary on the grid, health care IT and general privacy.

No Flash in the Pan

The use of flash cookies and its impact on privacy has been getting a

lot more publicity recently. Earlier this month, Michael Kassner had

a good piece on TechRepublic. Now Darren Chin has an

interesting take on Eosensa.

We have our view on the privacy implications of flash cookies

– as well as what pretty clearly constitutes misuse. So it’s

good to see this issue coming to the front and generating publicity.

From our view, Adobe’s (belated) effort to provide Flash cookie

controls can’t come soon enough. If the flash cookie stores user

preferences, with the user’s permission, then it’s a good addition.

But if it’s doing anything else — especially including behavioral

tracking — then it’s a real problem. We’ll let you know when we find

out more about Adobe’s timetable.

NIST Calls Data Privacy "Achilles' Heel" of the Smart Grid

Commerce Secretary Gary Locke today released the draft NIST Framework and Roadmap for Smart Grid Interoperability Standards. The draft highlights privacy as an issue that must be addressed as Smart Grid technologies continue to be implemented. Key points from the report include:

The Future of Privacy Forum is assembling a working group of companies, advocates, and academics who want to ensure that new data collected will empower users as it enables the technologies of the grid. It has been heartening to hear companies committing to consumer control during GridWeek presentations in Washington, but lessons from other areas of consumer data collection make it clear that communicating with consumers about data use is not easy. Now, before billions are spent to roll out new types of data collection, is the time to begin the needed research to understand the privacy expectations that consumers will have for the grid of the future.

Live Blogging From GridWeek

Round Two:

Updates today will be from our smart grid privacy fellow Matt Gruenberg:

Session on end user perspectives: do utilities truly understand their customers?

Ohio Consumers Counsel J.M. Ostrander only way demand response can work is if consumer understand it

Viktor Mayer-Schönberger on forgetting in a digital age http://bit.ly/NfALa Are grid folks thinking about data retention policies?

Val jensen of Con edison: debate among utilities and regulators as to who “owns” the customer

IBM Survey: Green is important but 90% of customers will not pay for it. (so here enter the data companies?)

Smartgrid Security: not everything requires same level of protection; It’s really CONTROL we need to protect. & DATA

Alabama Power: Will the consumer want all their electric usage analyzed?

Greenbox Technology: Home power usage details MUST be Opt-In.

Future of Privacy Forum: Great to hear everyone talking opt-in, but don’t think that talking to consumers about choices is easy. Research to learn how to engage users is critical, or consumers will be worrying about the grid version of cookies and web bugs.

GridWeek Day One

US CTO Aneesh Chopra at GridWeek says “democratize the data for smart grid apps”. FPF: OK, but these apps better behave, not like some socnet apps! You can also follow realtime at twitter.com/julespolonetsky

CNT Energy: Some ask: Why should power company send a bill telling you how you spend compared to peers. Credit card company doesn’t.

Austin Energy: Data has always belonged to customer. Feds need to play a role so AGs around the US don’t have different rules for obtaining user data

CNT Energy: With meter outside house, mos tpeole are already making power usage public

Tendril: Display power data to users in a way they understand, live power bars on cell fone.

Gridweek: Tom Casey of Current Group: McKinsey said 80 plus % of smart grid benefit gained on the grid side, not the consumer side. Major benefit to users has been reduced outages.

Tendril: Adrian Tuck Save money, save the planet, beat your neighbors. So use game theory to create competition between types of users. In his house, kids run around turning off power to beat the neighbors.

Tendril: But many users don’t care. So for them, make sure the smart devices are not disruptive.

Tendril: Zigby enabled GE fridge. Not disruptive. Looks like normal fridge, no space age screens. But usually makes ice at 3 a.m. because it gets a power price signal. Fridge talks to wash machine to be sure it doesn’t make ice when washing machine is running, avoiding peek usage.

Privacy and the Power Grid

Grid Week 2009 comes to Washington, DC this week and this year’s gathering features some of America’s top policymakers: Secretary of Energy Steven Chu, Secretary of Commerce Gary Locke and Aneesh Chopra, the Obama Administration’s CTO. In the coming years, these officials and their departments will make critical decisions about the future of smart grid technology.

We firmly believe in the potential benefits of enabling our electric power system to become “smart”. More efficient management of the power supply could bring down consumption, enable green technologies and help consumers save money. The many ways in which data about consumer demand will be used for smarter electricity provision have the potential to revolutionize the electricity industry and to benefit society. However, this very same information about consumers will create major concerns if consumer-focused principles of transparency and control are not treated as essential design principles from start to end of the standards development process. Principles of privacy by design must be part of the overall design for smart grid data flows.

We are pleased to announce that we have signed an agreement with the Gridwise Alliance (sponsors of Gridweek) to collaborate on projects involving data privacy and the smart grid.

We have also begun “construction” of *SmartGridPrivacy.org* (expired), a site that we hope will serve as a clearinghouse for information about the Smart Grid and privacy issues. And we are planning a conference that will be devoted to privacy issues related to the smart grid.

Contact Matthew Gruenberg, FPF smart grid policy fellow, at

[email protected] to get involved with any of our smart grid privacy efforts.

Future of Privacy Forum Advisory Board News

FPF is delighted to welcome several new members to our Advisory Board

Paul Ohm, associate professor at the University of Colorado Law School. Prof. Ohm is an expert in information privacy, computer crime law, intellectual property, and criminal procedure. To access his most recent paper, “Broken Promises of Privacy: Responding to the Surprising Failure of Anonymization,” please click here.

Ryan Calo, residential fellow at the Center for Internet & Society at the Stanford Law School. Calo’s expertise is on the intersection of privacy and technology. A Dartmouth grad with a JD cum laude from the University of Michigan Law School, Ryan was a contributing editor to the Michigan Law Review. To read his most recent paper, “”People Can Be So Fake: A New Dimension to Privacy and Technology Scholarship,” please click here.

Allen Brandt, corporate counsel, data privacy and protection Graduate Management Admission Council (GMAC). Allan Brandt advises colleges on data retention and privacy.

Terry McQuay, president, Nymity. Nymity is a global privacy and data protection research firm whose products are used more than 1,000 privacy professionals.

And A Fond Farewell

Two esteemed members of FPF’s Advisory Board have recently departed for higher callings. This summer, Peter Swire joined the Obama Administration as Special Assistant to the President for Economic Policy at the National Economic Council. A professor at Ohio State’s law school and an internationally recognized privacy expert, Peter had acted as the “White House Counselor for Privacy” during the Clinton Administration. His counsel to FPF has been invaluable.

Daniel Weitzner is now the Associate Administrator for the Office of Policy Analysis & Development at the Commerce Department’s National Telecommunications and Information Administration. As Director of the Decentralized Information Group MIT Computer Science and Artificial Intelligence Laboratory and Technology & Society Policy Director at the World Wide Web Consortium,,Danny still found some time to help shape our thinking about privacy.

Both Peter and Daniel joined the FPF Advisory Board at our inception. Our nation is well-served by having these two luminaries join the Administration.

Jodie Bernstein, Lifetime Achiever

A richly deserved tip of the hat is due to FPF Advisory Board member Joan “Jodie” Bernstein. Citing her “brilliant legal skills,” American Lawyer last week bestowed upon her its prestigious “Lifetime Achiever” award. This award goes to a select group of attorneys who, in the opinion of the magazine, have transformed the practice of law through leadership in public service and private practice.

In our view, it’s a fitting tribute for someone whose six decades of legal service have made her one of the nation’s most respected voices for consumer rights and privacy.

FTC to Dig Deeper on Privacy Issues

Back in August, the new head of the Bureau of Consumer Protection at the Federal Trade Commission, David C. Vladeck, sent a strong message that the Commission continued to be troubled by the state of consumer privacy in the U.S. and the current enforcement model. At that time, Vladeck said, “The frameworks that we’ve been using historically for privacy are no longer sufficient.”

It is our understanding that the announcement yesterday by the FTC that it would be holding a series of “day-long public roundtable discussions to explore the privacy challenges posed by the vast array of 21st century technology and business practices that collect and use consumer data” is an outgrowth of those comments. The commission is apparently particularly interested in hearing about new ideas for privacy models. What would be a better model that the current focus on protecting against harm or deception? What could work better than privacy policies? How can the government or industry play a role is assuring the “dignity” of online citizens?

As many are probably aware, the first of these meetings will take place on December 7th in Washington. We look forward to the Commission’s additional exploration of these issues…

Flash Cookie Confession?

I was pretty stunned to read this piece posted on MediaPost today. It usually takes a subpoena to obtain documents with comments like this:

“When Tatto began to develop its core behavioral frameworks and algorithms, it believed Flash cookies would remain the best way to slow the ability of consumers to delete cookies from their computers. Flash cookies are no different than regular cookies in terms of user privacy, but on average remain on a person’s computer for more than three months.”

Huh? Mr. Miao, please talk to a privacy professional ASAP. And read our previous post advising companies against misuse of flash cookies!