Will privacy be a key differentiator in the ad wars to come?

The battle lines over privacy are going to be drawn overseas before any lines in the consumer privacy protection sand emerge on these shores. It is revealing that Google chose Europe to make its first public pronouncement on privacy. The company called for countries and Internet companies to cooperate on some kind of international standards for information and identity protection. This amplifies Google’s own recent policy shift in Europe, which reduced the time it would hold onto personal data to 18 months.

What is the meaning of this? Why Google, and why now? Privacy is one of those issues that journalists and advocates tend to bicker over. The hard reality is that few citizen/consumers ever pursue the issue very aggressively with their own ISPs, with ad networks, or with publishers. Behavioral tracking has been fairly common for years and there has been little discernible backlash over cookies tracking people anonymously across sites.

Google’s is a pre-emptive strike and a kind of inoculation. With its recent announcement it would acquire DoubleClick, and rumors it would start using behavioral targeting in some way, the heat is going to be on. Yahoo has been tracking its users’ behaviors in a much more deliberate way than Google ever tries, but because it is number two in the search world, it gets a pass. When Google starts targeting ads off of people’s search behaviors, even though the practice is going on elsewhere, it raises a red flag to legislators. Google know this is a danger, but it also knows that targeting display and video advertising only moves to the next level when content providers track activity and behavior. Clearly, it wants to be out in front of this issue before any possible hammer comes down on them. This privacy initiative also sets the brand up to point fingers at rivals who user behavioral information more freely on behalf of advertisers.  Microsoft, Yahoo, and AOL all have made substantial purchases in the behavioral targeting realm. No doubt, Google will have its own targeting solution, too. But before making these moves, it is trying to inoculate itself with an international community that may incur much harsher restrictions and penalties on privacy violators than any U.S. body.

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Posted under Michael's Blog