Targeted Web Ads

With recent news that broadcasters are finally monetizing their web pages and selling advertising, in some cases doing better with online advertising than newspapers, more attention may also be focused on broadcast online advertising by regulators. Understand that you have the ability to offer a different and potentially more useful advertising product on your webpages, but also that targeted advertising has its own set of issues about which you must become familiar. In this regard, it is worth noting that Federal Trade Commission Chairman Jon Leibowitz has set his sights on targeted web ads.

Targeted web ads offer advertising opportunities for broadcasters that are not available to the over-the-air advertiser. While radio has been an historical leader in a different sort of targeted advertising, with demographic-based music formats, online advertising offers an exponentially greater degree of targeting by delivering ads to individuals based on the web pages they visit and searches they carry out. From the beginning, policy makers have expressed concerns about the practice's ability to invade the personal privacy of those targeted. However, recent surveys reveal that not all users of the Internet are unhappy with targeted advertising, as it does enable users to get advertising more focused on the material they actually are interested in, and filters out advertisements that show no relationship to their Internet interests.

Researchers estimate that advertisers will spend $960 million on personally targeted ads this year. The FTC is concerned about the privacy issues, but also about concerns that online advertisers are not always forthcoming about their use of targeting. In a Business Week interview, Leibowitz said "There's a critical issue about whether consumers have notice of what companies are doing with their information and whether they're making informed choices about [sharing] information," For example, if an advertiser sends an ad based on sensitive information about a person's health, "you might want to take that off the table." Broadcasters should note that Leibowitz counts FCC Chairman Julius Genachowski as a close friend and "basketball buddy."

The lesson for broadcasters: While selling your web pages, be responsible. Establish meaningful voluntary advertising standards for online advertising based on broadcast websites. Realize that broadcaster-originated online advertising requires different principles of good conduct than the standards formed for on-air broadcast advertising. In 2007, the FTC adopted proposed behavioral advertising principles for industry self-regulation. "Behavioral Advertising, Moving the Discussion Forward to Possible Self-Regulatory Principles," can be found at the following URL: http://www.ftc.gov/os/2007/12/P859900stmt.pdf. This would be a good place to start.

This column is provided for general information purposes only and should not be relied upon as legal advice pertaining to any specific factual situation. Legal decisions should be made only after proper consultation with a legal professional of your choosing.