FTC Urged to Adopt Microsoft's Privacy Standards

The Federal Trade Commission is getting an earful about Internet privacy. The opinions on the FTC's proposed self-regulatory principles to govern online advertising vary widely, with Microsoft taking bold steps to suggest an approach it deems "comprehensive."

On Friday, Microsoft proposed a five-tiered system to protect consumers' privacy. Its recommendations call for standards in five key circumstances: when site visitors' data is collected for online advertising, when ads are delivered on unrelated sites, when sites engage in behavioral advertising, when personally identifiable information is used, and when sensitive personal data is used.

"We welcome the opportunity to work with the FTC to ensure that online consumers benefit from meaningful privacy protections," said Brad Smith, senior vice president and general counsel for Microsoft. "Online advertising should put consumers in the driver's seat, not only with the information they want to see, but also with the tools to protect their privacy."

Greater Risk, Greater Protection

The foundation of Microsoft's approach is the idea that the greater the potential risk to privacy, the greater the protection. For example, the most stringent tier requires that online advertisers receive affirmative express consent from consumers before they may use sensitive personally identifiable information -- such as personal health data -- for advertising purposes.

The recommendations reflect Microsoft's Privacy Principles for Live Search and Online Ad Targeting, standards the company adopted in 2007 to promote greater transparency and give consumers increased control over privacy.

"Even as consumers value the benefits of online advertising, they may not fully appreciate the role data collection plays in the delivery of online advertising," Smith said. "Microsoft's proposed guidelines will help consumers receive relevant and helpful information while helping ensure their privacy is respected."

Bucking the System

While Microsoft is busy pushing its standards, others are speaking out against the FTC's recommendations. Specifically, the Newspaper Association of America...