NAI Blog

This month C-SPAN’s “The Communicators“ is featuring a series of interviews on online privacy and telecommunications policy.

Last week, FTC Consumer Protection Director David Vladeck gave a regulator’s perspective on the key issues.

This week, Yahoo!’s Anne Toth speaks to the essential role of transparency and control in addressing privacy concerns and building consumer trust.

Today the NAI is releasing a first-of-its-kind study about the economic value of behavioral advertising.   The study was conducted by former FTC Consumer Protection Bureau Chief Howard Beales, based on data from twelve NAI members with total ad revenue of $3.32 billion in 2009. Read the study and the NAI’s accompanying press release.

The study finds that behavioral-targeted ads sell for twice the price and offer twice the effectiveness of ordinary run-of-network advertising.   This added revenue flows back to publishers: the survey found that more than half (54.6%) of revenue went towards the purchase of advertising inventory. The study also finds that behavioral advertising revenue accounted for an average of 17.9% of the survey respondents’ overall revenue.
 
The Beales/NAI study highlights the importance of behavioral targeting to the advertising model that supports free online content and services for consumers.  The growing significance of behavioral advertising as a source of revenue for Internet content and services providers underscores the need for careful consideration of policies that would affect the current advertising marketplace and the innovation it supports.
 
We hope that this new economic data will help inform the public policy debate, and the NAI will be filing the study as a comment for the FTC’s “Exploring Privacy” Roundtable process.

Chuck Curran
NAI Executive Director

For its third town hall on online privacy issues, the FTC asked for comment from the online advertising industry and other interested parties on how we could achieve accountability for best practices or standards for commercial handling of data.  The NAI filed comments on that issue last week that we thought might be of interest. NAIFTCThirdRoundtableComments

Our comments focus on how the NAI’s self-regulatory program helps ensure compliance by the 40 companies who have pledged to abide by the NAI’s code for online behavioral advertising.  We also review how the NAI’s compliance process serves as an effective “first line” of accountability that helps the government by allowing it to focus its enforcement efforts on emerging privacy threats and true “bad actors.”  We also discuss the breadth of participation in the NAI’s compliance program by companies in the OBA marketplace and how such broad participation in self regulation promotes continued technological innovation for consumer privacy protection and the adoption of best practices.  We encourage you to take a look and see what you think.

–Chuck Curran, NAI Executive Director