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FTC slapped fine on online firm that tracked users for advertisers

It only takes one bad or careless actor to ruin a good thing.  Because online company Chitika Inc was busted tracking users without their prior approval, the FTC cracked down on it, issuing the company a fine and coming to a settlement and resolution recently, according to the Wall Street Journal.

Apparently, it appears that it was part of the impetus behind today’s Senate Commerce Committee hearing on privacy and an impending bill that John McCain and John Kerry plan to introduce soon.

In response to the fine and outcry, Chitika has been on the defensive.  Its president said in a press release recently  that it accidentally collected the personally identifiable information and that its advertisers actually do not care about that information.

“Personally identifiable information is of no interest to me whatsoever,” says Chitika CEO and founder Venkat Kolluri. “Our advertisements only worry about what you want, not who you are.”

The release also stated:

Chitika’s targeting consists of data such as browser, search engine, and search keywords, all of which allow the company to provide the most appropriate possible advertisements without collecting any data which could be used to identify an individual user.  The company continues to believe that non-PII data is a targeting method that is best for not only users, but also advertisers and publishers.

It will be interesting to see what type of testimony is given today.  The witness list includes the NTIA administrator, an ACLU rep, and someone from Microsoft and Intuit.  Noone to give the perspective of the edge innovators and the up and coming start ups?

My concern is that for many online start ups, digital tracking that does not take personal information could be shut down which would debilitate many new digital entrepreneurs.

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