There is increasing scrutiny over the use of browser cookies to track end user web behavior. The Wall Street Journal recently published an article titled, “Cookies Cause Bitter Backlash” as well as a series titled, “What They Know” which describes how companies are tracking individuals across the web in order to develop individual profiles that enable better ad targeting. In response, the more sophisticated web users erase cookies from their browsers but the vast majority of web users either don’t know how or don’t bother to erase cookies retained in their browsers.
Given it’s been possible for consumers to erase virtually all unwanted cookies, advertisers have argued to regulators that the public can easily decide to opt out of being tracked by simply taking the overt action to erase cookies between sessions. Now, however, a new type of cookie has emerged called the “Evercookie”. According to Jim Rapoza in his article titled, “The Cookies You Can’t Remove“, the Evercookie works by “…placing cookie data in several places within the browser, including the standard cookie cache, browser history, even within a specialized image file. Evercookie also utilizes new data storage features in HTML 5.” The evercookie ignores all browser requests by the end user to delete thereby eliminating consumer opt out options. You opt in simply by choosing to use the web. This has the public and regulators extremely concerned over privacy issues.
In my opinion, here is the quandary that companies and consumers are faced with: as web users we have grown to expect web content (and our consumer-based applications) to essentially be “free”. However, companies that produce content and consumer applications have to make a profit. To date, this quandary has been resolved primarily through the advertising business model. Over time, though, we have learned how to increasingly ignore web-based advertising. Consequently, web-based advertisers are demanding increasingly better results from their ad network spend.
In response, ad networks have had to become better and better at providing demonstrable results. They are doing this by capturing more and better data about the individual and serving up ads that are targeted towards that individual based upon their behavior as captured over time.
As a result, the lowly browser cookie – which according to Wikipedia was “originally created by Lou Montulli at Netscape…as a solution to the problem of reliably implementing a virtual shopping cart” – has become the main protaganist in the nefarious plot. And, the evercookie promises to be its mega-steroid amp’d up “super villain” cousin.
Where this all ends, it’s unclear. One thing is for certain though, advertisers are getting better and better at targeted advertising (not just via the web — look at what companies such as Invidi are doing with TV). And, as long as consumers continue to expect something for “nothing”, they can expect the hidden costs of “nothing” (e.g. privacy erosion) to increase.