In Ad Network Nightmare, Microsoft Making ‘Do Not Track’ Default for IE 10

Microsoft announced Thursday that the next version of its browser, IE 10, will ship with the controversial “Do Not Track” feature turned on by default, a first among major browsers, creating a potential threat to online advertising giants.

That includes one of Microsoft’s chief rivals — Google.

The change could also threaten the still-nascent privacy standard, and prompt an ad industry revolt against it.

Do Not Track doesn’t attempt to block cookies — instead it sends a message to every website you visit saying you prefer not to be tracked. That flag is currently optional for sites and web advertising firms to obey, but it’s gaining momentum with Twitter embracing it last week.

The proposal also has the backing of the FTC, which has grown deeply skeptical of the online ad industry’s willingness to play fairly with users and has threatened to call for online privacy legislation. After initially opposing the idea, the online ad industry is now seeking to soothe the feds by hammering out rules that aren’t too tough on data collection. The hope then is that not many users avail themselves of the tool, and then not much has to change in how ad companies build profiles of users in order to sell premium-priced targeted ads.

But Microsoft’s announcement throws a wrench in those plans, since it’s likely that eventually something like 25 percent or more of the net’s users will upgrade to IE 10 over time and have DNT on by default. Microsoft said it’s making the change to better protect user privacy, and given the IE team’s recent history of including privacy technologies in the browser, that’s easy to believe.

We believe that consumers should have more control over how information about their online behavior is tracked, shared and used. Online advertising is an important part of the economy supporting publishers and content owners and helping businesses of all shapes and sizes to go to market. There is also value for consumers in personalized experiences and receiving advertising that is relevant to them.

Of course, we hope that many consumers will see this value and make a conscious choice to share information in order to receive more personalized ad content. For us, that is the key distinction.

But its chief online rival, Google has a thriving ad display business that uses the kind of tracking cookies that Do Not Track would block, though Google denies that’s why it opposed DNT early on. Microsoft’s third-party ad network is tiny in comparison — making the choice not too hard for the company to make.

But the change could backfire by undermining the loose coalition working to create a standard, in the web’s usual, messy, multi-stakeholder way.

Consider this scenario: If indeed the net’s major advertisers obeyed Do Not Track and IE 10 keeps the default,  more than a quarter of the net’s users would be opted out of behavioral ad tracking by default.

That’d be a far cry from a purely opt-in system that might be used by a single-digit percentage of opt-in users — those who likely don’t click on ads in the first place. So that could make the online advertising industry back out of the process and decide not to implement DNT — or to write its own rules for how it interprets DNT.

The move comes in the midst of a large and messy standards setting wrangling at the W3C over what “tracking” and “Do Not Track” actually mean. So for instance, how does it affect popular analytics programs and third-party plug-ins? Would a news site be able to track what users do on its own site? Does the flag mean “don’t collect information” or “don’t use the information to show targeted ads”? What happens if I’m logged into a site and have DNT turned on? And when users choose to turn it on or off in their browsers, what guidance if any should be given by the browser?

Justin Brookman, the director of consumer privacy at the Center for Democracy and Technology, applauded the move as pro-privacy, though he’s concerned about the timing.

“I hope this doesn’t throw a wrench into works on getting agreement on Do Not Track,” Brookman said. “But I like it when browsers compete on privacy.”

Brookman points out that years ago Apple set the default on the Safari browser to block third-party cookies, a far stronger protection against behavioral ad tracking cookies than Do Not Track, and that there’s a huge number of advertisements that aren’t based on tracking — they instead are based off the content of the page or the site the ads are displayed on.

But that’s not going to be an argument welcomed by the online advertising business.

Wired contacted the Interactive Advertising Bureau, which is on the W3C working group for comment, but the group did not send out its official response by press time.

Given federal and European regulators stance on online tracking and the online ad industry’s lackluster job of policing itself, something is going to change online. Even a widely used Do Not Track might still be a less burdensome change for online advertisers than a edict or badly-thought-out cookie mandate from governments.

“This is going to be painful either way,” Brookman said.

Photo: Jonney/Flickr