This story was written by Keith Dawson for the Industry Standard's Media Grok email newsletter. It is archived here for informational purposes only because The Standard's site is no more. This material is Copyright 1999-2001 by Standard Media.

THE INDUSTRY STANDARD MAGAZINE
Foxes and Henhouses
Aug 01 2000 12:00 AM PDT



The Federal Trade Commission has agreed to let the foxes run the henhouse, yet some in the press covered the story as if it were a victory for the hens.

A group of advertising companies that together represent 90 percent of the online ad business agreed to be bound by a code of conduct they have written down. The agreement requires the companies to let consumers know when they are being profiled and give them the chance to opt out of data collection. The companies also agreed not to use consumers' Social Security numbers, medical or financial records, or sexual preferences (as inferred from online behavior) to target ads online.

The Wall Street Journal's coverage stressed all the concessions to consumer choice that the online advertisers made under pressure. The Washington Post's story, by John Schwartz and Robert O'Harrow Jr., presented a more skeptical look, calling advertisers "gleeful" over the pact and enumerating all the loopholes the agreement leaves open for consumer profiling.

One of those loopholes was on display this morning, as at least four major outlets carried a story written by the AP's D. Ian Hopper. Yet another Net security consultant has caught yet another Net marketing company sending encrypted customer data back to the mother ship without notice. The company, Coremetrics, offers an outsource service for companies that aren't equipped to handle all of that customer data collecting and profiling. At least four Net retailing sites were sending data to Coremetrics, apparently in violation of their privacy policies.

Speaking of foxes, how would you like to depend on the U.S. Postal Service to deliver your e-mail while shielding you from unwanted junk mail? We didn't think so. The USPS has plans to associate an e-mail address with every physical address in the country. This linkup, the holy grail of online marketers everywhere, would be completely safe and secure on the Postal Service's servers. The Wall Street Journal's level look at this unlikely scheme was picked up by MSNBC and ZDNet. - Keith Dawson

U.S., Online-Advertising Group Agree to Protect Privacy of Consumers' Data
Wall Street Journal
(Paid subscription required.)

Online Privacy Code Gets FTC's Support
Washington Post

Internet Privacy 'Safeguards' Approved
BBC

Vendors Send Personal Information to Marketing Firm, Despite Policies (AP)
San Jose Mercury News

Net Marketing Firm Receiving Personal Information (AP)
CNET

Postal Service to Offer E-Mail
Wall Street Journal
(Paid subscription required.)