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ISPs: Self-regulation best for ad privacy

With targeted online campaigns gaining favor with advertisers, lawmakers listen to the privacy views of Internet service providers AT&T, Verizon, and Time Warner Cable.

Several of the nation's largest Internet service providers were called to Capitol Hill on Thursday, as lawmakers delved whether new laws are needed to protect consumers' privacy amid targeted ad campaigns.

Representatives of AT&T, Verizon Communications, and Time Warner Cable addressed the U.S. Senate Committee on Commerce, Science, and Transportation during a hearing on broadband provider practices and consumer privacy.

The ISPs urged committee members to forgo passing new laws to regulate the use of targeted online advertising, instead advocating for a self-regulation of the industry to keep consumers' Web surfing habits secure and private.

During the hearing, the ISPs, along with Gigi Sohn, president of public-interest advocacy group Public Knowledge, outlined measures that ISPs, advertising networks, and search engine companies should be deploying, as the use of targeted online advertising gains favor with advertisers.

Targeted advertising tracks the various Web sites a user visits, culling information on their surfing habits to deliver specific ads to the user based on that information. In describing the deep-packet inspection of a user's Internet traffic, Sohn compared it to a postal worker ripping open a user's mail.

"Deep-packet inspection is the Internet equivalent of the postal service reading your mail. They might be reading your mail for any number of reasons, but the fact remains that your mail is being read by people whose job it is to deliver it," Sohn said during the hearing.

She added: "Until recently, when you handed that envelope to your ISP, the ISP simply read the address, figured out where to send the envelope in order to get it to its destination, and handed it off to the proper mail carrier. Now we understand (that) more and more ISPs are opening these envelopes, reading the contents, and keeping or using the contents inside for their own purposes or to pass it on to third parties to use."

The Internet providers offered several recommendations for members of their industry, as well as advertising networks and search engines, with respect to behavioral-targeted advertising.

One recommendation includes requiring users to opt into a deep-packet inspection program, or DPP, rather than automatically signing them aboard. And, more importantly, ensuring that they have the ability to sign out of such a program if they initially allow DPP, said Thomas Tauke, Verizon's executive vice president of public affairs, policy, and communications.

Consumers should also have a clear understanding of what the program will do with their information, as well as a prominent location to read about that policy, noted Peter Stern, Time Warner Cable's chief strategy officer. Stern also advocated the safeguarding of the information.

Although targeted online advertising is most popular among advertisers, at least one ISP noted that it also is taking advantage of its methods.

"AT&T does not use a deep-packet approach but will engage in targeted ads, only after a consumer has consented," said Dorothy Attwood, AT&T Services' vice president of public policy and chief privacy officer.