IAB Counsel: Push to Regulate Online Ads May Lose Traction

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Hyperlocal news publishers have a better chance to prosper with targeted display advertising that is self-regulated, according to Mike Zaneis, the Interactive Advertising Bureau’s General Counsel and Senior Vice President of public policy.  Zaneis told Street Fight in an interview that bills pending in Congress to regulate targeted advertising may lose traction in 2012 because of the “unintended consequence” those bills may have to online publishers and advertisers. The IAB promotes the growth of interactive advertising and represents more than 500 companies.

In a story on Street Fight earlier this month, Borrell Associates reported that spending on targeted display advertisements may account for over 45% of local and social advertising this year. In order to protect such growth, online advertisers are pushing a self-regulatory scheme for behavioral advertising to fend off proposals in Congress to regulate such advertising. Industry groups like the IAB fear government regulations may slow growth for the online industry. Zaneis believes the self-regulatory program is working, while regulators such as the Federal Trade Commission believe consumers need more protection.

The Federal Trade Commission issued a report on December 2010, contending the industry was not doing enough about online behavioral advertising to protect consumers. The FTC suggested in its report that browsers should include a “do not track” mechanism. Following the report, a flurry of new bill hit Congress to regulate such advertising. For example, on the Senate side, Senator Jay Rockefeller (D-W.V.) introduced his  “Do Not Track” bill, while former presidential nominees John Kerry (D-Mass.) and John McCain (R-Ariz.) introduced the Kerry-McCain Commercial Privacy Bill of Rights Act. On the House side, Rep. Jackie Speier (D-Calif.) introduced the Do Not Track Me Online Act. However, Zaneis believes that the drive to push the bills through Congress may be coming to a “screeching halt” now that Congress is beginning to realize that specific details required to regulate online advertising is not as easy as it first seemed.

“Trying to create legislative restrictions on a fundamental business is difficult and will lead to unintended consequences,” Zaneis told Street Fight. Zaneis said that figuring out the details in a bill regulating online behavioral advertising is “not as easy as viewing it at a 60,000-foot level.”

Zaneis believes that the new “aboutads.info” self-regulatory program lead by the Digital Advertising Alliance is the “proven choice” now for consumers, publishers and advertisers. Advertisers, advertising networks and publishers can participate in the program by use of a special advertising icon that give consumers choices on targeted advertising.

Zaneis said the IAB’s statistics indicate that two billion ads are served per day with the aboutads.info icon and that 95% percent of the advertising networks and online behavioral analysts participate in the program. Zaneis pointed out that the program provides providing “greater consumer transparency,” is “easy to use” and gives consumers “greater choices.”

Zaneis believes that if you “take away the regulators,” targeted advertisers can be a “leading factor” for smaller, hyperlocal news publishers. The IAB launched its “Long Tail Alliance” to help education smaller publishers and advertisers about online advertising.

Brian Dengler is an attorney with Vorys Legal Counsel and journalist who covers legal issues in eMedia. He is a former vice-president of AOL, Inc., a former newspaperman, and an EMMY-winning TV journalist. He teaches new media issues as an adjunct at Kent State University and formerly at Otterbein University.