DoubleClick Off FTC Privacy Hook

23 January 2001

A Federal Trade Commission investigation into alleged violations of privacy by DoubleClick – the web’s largest ad agency – was dropped yesterday.

The probe followed accusations from federal and state consumer protection offices along with privacy lobbyists that DoubleClick had violated consumers’ privacy by tracking their web-surfing itineraries and linking them to a massive database of individual names and addresses.

Prior to 1999, the agency denied collecting data on individual consumers. However, in that year it acquired for $1.7 billion Abacus, a company specialising in the collection of data on consumer catalog shopping habits, and said it would merge this information with its own web-tracking data.

The resultant uproar and subsequent intervention by the FTC damaged both DoubleClick's public image and its stock price, causing it to backtrack rapidly last May with a change to its privacy policy and an announcement that it would not merge DoubleClick and Abacus data.

In a letter received yesterday by DoubleClick’s lawyers, the FTC wrote: “It appears to [our] staff that DoubleClick never used or disclosed" personally identifiable information "for purposes other than those disclosed in its privacy policy.”

But the agency is not entirely off the hook: “This action is not to be construed as a determination that a violation may not have occurred," said the letter, adding that the FTC reserved the right to take additional action.

In a telephone interview yesterday with the New York Times, Commissioner Mozelle W Thompson warned: "We're going to keep an eye on DoubleClick. They have to establish with consumers that for giving up information, they get something for value."

The FTC's rider failed to spoil the day for DoubleClick chief executive Kevin P Ryan: "We feel that it's helpful and gratifying that the FTC looked at these practices and concluded that there's nothing left for them to investigate," he said.

News source: New York Times