The National Advertising Initiative: Notice – Still Not Clear or Conspicuous
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One of the issues raised in the FTC reports to Congress about online behavioral profiling was notice. The FTC and the NAI promised “robust” enforcement of notice. Unfortunately, because the foundational understandings of the NAI are out of date, the NAI ideas of notice that flow from those understandings are also out of date.
Roy Shkedi, the founder and CEO of Almond Net, a behavioral advertiser, said the following at a Media Post conference:
The consumer is always one click away from opting out …. most behaviorally targeted ads, you have no idea you are being targeted …. to find out you are being targeted, unless you are really web savvy, is really problematic. [69]
Almond Net is worth discussing in the context of notice because this company brands each targeted ads with the Almond Net name (Powered by Almond Net) and offers a one- click opt-out. This is a simple way of providing greatly increased notice in context. Privacy policies remain important. However, clicking through a privacy policy is not always possible or practical in newer advertising models, such as ads delivered to the mobile web. Does a seven-page privacy notice work on a mobile phone? However, branding on the face of delivered ads discloses where that ad originates and provides a consumer with a chance to figure out what is happening on the consumer’s device.
In terms of notice, one of the great failures of the NAI is that technologies beyond the traditional cookie and web beacon or pixel tag are not required to be exposed to consumers. Notice is not required for new technologies such as Flash cookies or cache cookies.
Notice and Disabilities
Another NAI shortcoming is the failure to incorporate specific tools to assist individuals with disabilities. This was a mistake at the time the NAI agreement was published in 2000. But now, as the advertising technologies have become more sophisticated and have moved to additional devices, the situation is even more pressing.
Enforcement of NAI a Failure
The NAI agreement required NAI to either work with a third party enforcement program or undergo and publish regular compliance audits. In the FTC’s second report to Congress on online profiling in which it recommended the NAI self-regulatory scheme, the FTC said:
The bedrock of any effective self-regulatory or legislative scheme is enforcement. In a self- regulatory context, this means that nearly all industry members subject themselves to monitoring for compliance by an independent third party and to sanctions for non-compliance, which may include public reporting of violations or referral to the FTC. Enforcement may be provided by a seal organization, such as BBBOnline or TRUSTe. Under the NAI Principles, network advertisers have committed to working with an independent third party enforcement program (e.g., a seal program) to ensure compliance with the Principles. If no such program is available within six months, the NAI companies will submit to independent compliance audits the results of which will be made publicly available. [70] (Emphasis added.)
Time has shown that enforcement of the NAI is inconsistent, opaque, and generally problematic.
NAI tasked TRUSTe with enforcement and oversight:
The NAI 3rd party enforcement program
The NAI and its member ad networks have engaged TRUSTe, a leading online privacy auditor, to manage an independent program that ensures compliance with the NAI self-regulatory principles. You can register complaints alleging non- compliance with the NAI Principles at this Website: http://www.truste.org/consumers/watchdog_complaint.php
TRUSTe will investigate complaints via its Watchdog site. This process is managed entirely by TRUSTe and is completely independent of the NAI and its member ad networks. [71]
The official NAI site as of October 2007 still lists TRUSTe as its third party enforcement tool. [72]
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Endnotes
[69] Roy Shkedi, CEO of AlmondNet, Is Privacy the Third Rail? <http://www.brightcove.tv/title.jsp?title=1126051143&channel=429048905>.
[70] See FTC Online Profiling: A Report to Congress Part 2 at 8. 32
[71] Network Advertising Initiative web site <http://www.networkadvertising.org/managing/enforcement.asp>. Last visited October 30, 2007.
[72] See <http://www.networkadvertising.org/managing/enforcement.asp>.
Roadmap: The National Advertising Initiative – Failing at Consumer Protection and at Self-Regulation: Part II – Discussion: Notice – Still Not Clear or Conspicuous