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Research: Strict Privacy Regs for Online Ads Harmful

By 10 September 2010 No Comment

Stricter Privacy Regulations for Online Advertising Will Harm the Internet
Information Technology & Innovation Foundation
Daniel Castro
September, 2010

Castro believes that current legislation on advertising could be detrimental for online businesses. Stricter privacy regulation for online advertising could reduce money that goes toward supporting free content or inexpensive content as well as applications and services.  Castro also feels that this could reduce start up funding and the effectiveness of advertising.

It is pointed out that in Europe, when advertising privacy laws went into action the effectiveness of the ads was reduced by 65% decreasing revenue produced by ads that supports websites.  In the U.S. non-search advertising grew from $6 billion in 2002 to $13 billion in 2007.  Castro believes that we would see a sharp decline in these figures with stricter controls and that Congress should consider the full ecosystem of the Internet before making blanket policy that could damage the Internet economy.

You can find the full article here.

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