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Online ad industry will probably continue to be a hot-button if FTC Commissioner Jon Leibowitz is named chairman. The Federal Trade Commission may strengthen its focus on online advertising and privacy if, as is expected, current FTC Commissioner Jon Leibowitz is named chairman of the agency. "He would certainly keep privacy and online advertising as a focus of the FTC, so I think [his potential appointment] does matter," said Mike Zaneis, VP of public policy at the Internet Advertising Bureau. Reports indicate Leibowitz will be named as head of the commission, replacing William Kovacic. Kovacic replaced former Chairman Deborah Platt Majoras in March 2008, when she left to join the private sector as VP and general counsel of Procter & Gamble. "A kind of privacy switch is going to go on at the FTC [once the new chairman is named] and they're going to engage in this issue in a much more serious way," said Center for Digital Democracy Executive Director Jeff Chester. "Under a Leibowitz regime we would get the kind of serious industry analysis that so far has been lacking from the Bush era approach." "Leibowitz has been a leader on privacy issues," said Zaneis, who expects a Leibowitz-run FTC to continue along the agency's current path of pushing for industry self-regulation, rather than creating new regulations for online advertisers. As a commissioner, Leibowitz, a Democrat, has not ruled out FTC regulation of things like behavioral targeting. During a two-day FTC forum held in Washington, D.C. in 2007, Leibowitz noted, "The marketplace alone may not be able to solve all problems inherent in behavioral marketing." He revealed his sense of humor, adding, "If we see problems...the commission won't hesitate to bring cases, or even break thumbs."

On November 1 and 2, 2007, the Federal Trade Commission will host a Town Hall entitled "Ehavioral Advertising: Tracking, Targeting, and Technology." The event will bring together consumer advocates, industry representatives, technology experts, and academics to address consumer protection issues raised by the practice of tracking consumers' activities online to target advertising - or "behavioral advertising." The Town Hall is a follow-on to a dialogue on behavioral advertising that emerged at a November 2006 FTC forum, "Tech-Ade," which examined the key technological and business developments that will shape consumers' core experiences in the coming ten years. In addition, several consumer privacy advocates, as well as the State of New York, recently sent letters to the FTC asking it to examine the effects of behavioral advertising on consumer privacy. The Town Hall will explore how the online advertising market, and specifically behavioral advertising, has changed in recent years, and what changes are anticipated over the next five years. Among other things, it will examine what types of consumer data are collected, how such data are used, what protections are provided for that data, and the costs and benefits of behavioral advertising to consumers. The Town Hall will also address what companies are disclosing to consumers and what consumers understand about the online collection of their information for use in advertising. In addition, the Town Hall will look at what regulatory and self-regulatory measures currently govern the practices related to online behavioral advertising, as well as anticipated changes in the behavioral advertising space in the future. The Commission invites interested parties to submit requests to be panelists and to recommend other topics for discussion. The requests should be submitted electronically to behavioraladvertising_requests@ftc.gov by September 14, 2007. The Commission asks interested parties to include a stat

Facebook has gone a long way to protect the privacy of users on its own site. But what happens when users share their Facebook profiles and friend lists with other sites? Are social networks responsible for defending data its members decide to take elsewhere? Those questions have taken on added urgency following the introduction of tools by leading social networks, including Facebook and News Corp.'s (NWS) MySpace, that let users interact with their friends on partner sites. Facebook Connect, for example, lets a user instantly share a movie rating on Netflix (NFLX) with all or some of his or her pals on Facebook. Privacy advocates warn that these services pose a whole new set of concerns about how user data are collected and shared among sites on the Web. Using these open-networking tools, thousands of companies can unearth a trove of new data about a visitor-age, gender, location, interests, and even what a person looks like. "I'm wondering if people really understand when they're using Facebook Connect that other sites get access to their whole user profile and social graph," says Pam Dixon, executive director of the World Privacy Forum. Announced last July, Facebook Connect has already signed up more than 8,000 partner sites, many of which plan to use data collected on Facebook members for their own purposes. Joost, a video-viewing site that integrated with Facebook Connect in December, checks the ages of viewers entered on their Facebook profiles to give its own content partners-CBS (CBS), for example-a better idea of which Joost users are watching CBS programming. Digg.com will let users display their Facebook profile photos alongside comments they make on the social news-sharing site.

Since Obama's landmark speech on cybersecurity in May, his administration hasn't revealed much about its long-percolating plans to shore up the government's defenses against hackers and cyberspies. But privacy advocates monitoring the initiative are already raising concerns about what they know and what they don't: the details that have trickled out--including the involvement of the National Security Agency--and the veil of classified information that still covers much of the multibillion-dollar project. "It feels like the Bush administration all over again," says Pam Dixon, executive director of the World Privacy Forum. "Not enough people know the details about these programs to have a good public discussion. We all want good security of government systems, but you have to balance the cloak and dagger elements with civil liberties."

Buying and renting tools used by cybercriminals to conduct attacks and steal credentials is becoming much easier for the average person. "For Rent" signs hang on botnets, automated hacking toolkits are sold at bargain prices, and the data reaped by the criminal activity is sold and traded in online forums on a daily basis. Researchers at networking giant Cisco Systems Inc. are warning of the increasingly sophisticated cybercriminal underground economy and how it could be attractive to those having trouble finding work or facing layoffs in a troubled global economy. Meanwhile, cybercriminals are borrowing some of the best strategies from legitimate companies and forming partnerships with one another to help make their illegal activities more lucrative, according to Cisco.

Yahoo Tuesday announced that has developed a feature that will allow users to opt out of behavioral targeting on mobile devices. "We believe the mobile experience should offer the same privacy protections consumers expect to find on the PC," Yahoo said in a blog post announcing the feature. "Furthermore, management of privacy protections should be available via any mobile device, whether that's an iPhone or a Blackberry." Many companies that track people's Web activity on PCs and send them ads notify users about the practice and allow them to opt out. But it's still unusual for behavioral targeting companies in the mobile space to let people opt out. At least a dozen companies say they offer some form of mobile behavioral targeting. But only two appear to allow users to opt out, according to Jules Polonetsky, co-chair and director of the think tank Future of Privacy Forum.

"The smart grid is rapidly becoming a reality in the US, as utilities have been installing networked monitoring and control equipment, both in their own facilities and in their customers' homes. The pace of these installations should accelerate due to recent initiatives from the Department of Energy and the state of California; across the border, the Province of Ontario will see smart meters installed in every home by the end of next year. Ontario's Information and Privacy Commissioner has now worked with members of the Future of Privacy Forum to analyze the privacy implications of these initiatives. The resulting report indicates that there are a variety of potential privacy concerns, some of which are best addressed before the deployments begin in earnest. "

"A key, centrist digital rights group is set to put out a report calling for strong federal privacy laws and guidelines to regulate the growing tracking and targeting of Americans online. It argues that the self-regulation approach that industry fights for just hasn't worked. The online ad industry has "historically failed to fully implement its self-regulatory principles," according to the 34-page draft report by the Center for Democracy and Technology. CDT is a centrist D.C. group that works with and is substantially funded by the tech industry, including companies like Facebook, Google and AOL that are deeply invested in targeted ads. "Recently revised self-regulatory principles still fall short (.pdf) even as written," charges the draft, obtained by Wired.com. These tough words spearhead a new tactic for a group more used to convening inside-the-Beltway tech policy forums than launching ACLU-style send-outraged-e-mail campaigns. The CDT, which splintered off from the rabble-rousing Electronic Frontier Foundation 15 years ago, is also planning to launch a "Take Back Your Privacy" campaign on Thursday, designed to garner support for its call for comprehensive federal privacy legislation. Dozens of tech firms, known and obscure, record users' behaviors as they interact with search engines, blogs, e-commerce sites and even government websites. The tracking goes on in the background with little knowledge by consumers and even less oversight from government authorities. The tech industry - like others subject to potentially blunt-forced government regulation - has argued that policing itself was enough to prevent egregious privacy intrusions that could proliferate without any real chance individuals would even be aware of them."

"State regulators may consider requiring utilities and other firms to provide customers clear information regarding how their data may be used, if consumers authorize such use, and guaranteeing that customers have the ability to select the purposes for which their data may be used."

These were developed for boards, but they would probably be a good basis for questions auditors could ask as well.