DAA Departure from DNT Working Group Could Ramp Up Push for Hill Solution, Stakeholders Say

"The DAA no longer believes that the [working group] is capable of fostering the development of a workable ‘do not track’ (DNT) solution,” said DAA Managing Director Lou Mastria in a letter to working group participants. He said previous supporters and others “now conclude that the process has devolved into an exercise in frustration on all sides without any meaningful increase in consumer choice or transparency.” The DAA’s input was “rejected out of hand,” he said, and “it is not possible to move forward without an accounting for the previous flagrant disregard for procedure."

The dissolution of the process could leave room for legislators to get involved, several stakeholders told us. Senate Commerce Committee Chairman Jay Rockefeller, D-W.Va., who introduced a bill addressing DNT in February (CD March 1 p10), sees legislation as “the only way to give consumers more control over their personal information. Industry has proven it won’t do it of its own accord,” he said in a written statement. “When the online advertising industry has no incentive to provide consumers with strong privacy protections, this is the result."

The working group is scheduled to meet Wednesday for the third time since July, when Jonathan Meyer resigned over frustrations about the “absence of process” in the work, he said then (CD Aug 1 p4). In July, the working group wasn’t able to vote on whether to move forward with a draft favored by the group’s co-chairs, who had earlier rejected a proposal from the online ad industry (CD July 25 p15). That month, the group also failed to reach consensus on the draft, which included 23 change proposals (CD July 31 p13). Then-Chairman Peter Swire left the group in August to head President Barack Obama’s intelligence review panel (CD Aug 29 p2).

Swire shares the DAA’s frustration with the “inability of the working group to get better results,” he said in a Tuesday email after the DAA’s announcement. “I no longer see any workable path to a standard that will gain active support from both wings of the working group,” he said, referring to the ad industry on one side and privacy advocates on the other. He also responded to criticism from the DAA’s Mastria, who said in his email that Swire had “jettisoned the long-accepted W3C procedure in order to anoint his own path forward.” Swire said “a fair review of the history, however, shows that the views of the DAA and its members were valued and included” in the group’s work. Participants frustrated with an outcome often blame procedure, he said, but “the procedures at W3C this summer are not the reason” DNT was such a difficult problem.

"That the DAA decided to walk away was not surprising,” said John Simpson, Consumer Watchdog’s Privacy Project director. “At the end of the day, you're probably not going to be able to reach consensus around a meaningful DNT standard that gives consumers the privacy protections they want through a multistakeholder process,” he told us. Simpson said even the ongoing participation of other ad industry groups doesn’t improve his outlook for the group’s success. Executives from the Interactive Advertising Bureau, Network Advertising Initiative and Direct Marketing Association -- DAA members that also send individual representatives to the W3C -- said Tuesday they will continue to participate. Simpson said he still couldn’t imagine an outcome that everyone would honor: “If everyone who can’t agree leaves the group, then maybe you come up with a standard that the group agrees to but no one will implement.” A true solution will likely require further legislation or regulation, he said.

Despite the DAA’s departure, the working group may be in better shape than ever to achieve its goals, W3C Communications Director Ian Jacobs told us. The W3C took the departure seriously because “we know that it’s important to have all of the key stakeholders at the table,” he said. But the group is “very close” to announcing new chairs, and “we have a concrete plan that has been reviewed by the group,” he said. “This is actually a better place than we've been in before. We had a draft document to start from, we're refreshing the chairing and we have a well-defined process for getting forward, to get to last call.”

Jacobs was referring to the draft of a strategic plan to move forward, the final version of which was released Tuesday by Chairman Matthias Schunter (http://bit.ly/1emefYB). The plan represents the W3C’s “preferred way to continue,” though working group members are responding to an open poll on how the group should proceed, Schunter said. One option is to dissolve the group, Simpson told us. If the chair’s plan is adopted, the group would modify several of its procedures, Schunter said. First, if a resolution has no alternates within 14 days, the chairs can determine it has reached consensus. Second, the group will be reminded via email that an issue is about to close. Third, if an issue doesn’t satisfy the requirements in the chair’s plan, it will be closed after Oct. 2, said Schunter. W3C CEO Jeff Jaffe said the new plan should encourage the DAA to rejoin the process. “I hope that DAA continues to monitor this work. As they see progress and momentum, they should rejoin W3C’s consensus process,” he wrote in a Tuesday blog post (http://bit.ly/1emdIpJ).

If the DAA’s departure is one more sign that the process has stalled, it could renew calls for a consumer privacy bill of rights through legislation, said Consumer Action Senior Associate Michelle De Mooy. She said the working group still had a chance of finding a solution, and said the DAA’s departure was not a “huge blow” to the process. But “this would be a perfect time for the White House to shift focus and renew efforts to get something going” on consumer privacy, she said. Simpson agreed, saying, “What this really demonstrates is that at the end of the day we're going to need to have legislation, and also that consumers will probably start to take other sorts of counter measures.”

Barring action from Congress, Simpson said action at the state level could show promise for DNT initiatives. He pointed to a bill waiting for California Gov. Jerry Brown’s signature that would require companies to explain what they do when they receive a DNT notification from a browser. Consumer Watchdog is “strongly considering” introducing a ballot initiative in that state that would implement a DNT standard legislatively, said Simpson. The group is looking to draft language for such a measure, and will decide whether to file with the state attorney general by next month, he said.

De Mooy and Simpson said the FTC could address the issue under its Section 5 authority. Commissioner Maureen Ohlhausen said in March she was “standing back and seeing how things play out” on the efforts to address DNT (CD March 8 p10). FTC Chairwoman Edith Ramirez is disappointed the DAA is withdrawing from the W3C, she said in a Tuesday written statement. “That said, my end goal on Do Not Track remains for consumers to have meaningful choices not to be tracked, whether that option emerges from within or outside the W3C.” She said consumers deserve a DNT system that is “easy, effective and enforceable, persistent, universal and that affects collection, not just use, of data for marketing purposes.” Reaching that goal will require compromise from all involved, she said.

Now that it has withdrawn from the group, the DAA will immediately begin a process to evaluate how browser-based signals can be used to meaningfully address consumer privacy, Mastria wrote in his letter. It said such work would “be a more practical use of our resources than to continue to participate at the W3C.” Meanwhile, Consumer Action on Tuesday began an educational website, RespectMyDNT.org, to give consumers information on DNT, which it called “the still undefined tool that aims to help consumers limit online tracking” (http://bit.ly/1bpf7KY). De Mooy said that though the W3C working group action had stalled, “there was hope that other standards bodies or legislation in Congress might aid in the adoption of DNT or other tracking protections.” -- Erin Mershon (emershon@warren-news.com)