Will Google's User-Controlled Profiles Open a Pandora's Box?

Those looking for a cure for online publishing’s woes probably took notice earlier today of Google’s announcement that it was going to jump into the behavioral targeting ring, targeting ads to users’ online behavior, above and beyond the search terms they might enter into Google at any given time. (Using cookies, “BT”, as it has come to be known, will, for example, serve car ads to users whose previous online behavior indicates they are in the market for a new car.) But there’s reason to wonder if Google has unintentionally just announced the beginning of the end of BT.

One focus of the stories that have come out today is that this may be Google’s new growth engine for revenue, given that its search ad growth is slowing. That’s because BT, being so exquisitely targeted, carries a higher cost-per-thousand views, and that should lead to revenue gains not only for Google, but for the publishers that serve up its behaviorally-targeted ads.

But let’s get beyond the small world of online advertisers and publishers for a moment and ponder the ramifications of Google’s decision, as part of its BT initiative, to let users look at, and edit, their BT profiles. In some ways, Google’s timing couldn’t be better; the Federal Trade Commission is pressuring the industry to self-regulate itself, or else — a former FTC chair, Deborah Platt Majoras, said at a conference just yesterday that the industry better move quickly to develop some standards. For the biggest revenue generator in the online world to let users control their profiles is huge, and would go a long way toward making that standard practice for any company that engages in BT. (Interestingly, the Newspaper Association of America, in December 2007, told the FTC that efforts to regulate the industry were a violation of its members’ rights under the First Amendment.)

But Google may also have opened up a Pandora’s Box here: giving users access to their information has the potential to kill or maim BT, if users discover they want that control enough and enough of them take that control. Google will not be the first to let users entirely opt-out  — Yahoo already does that — and BT has stayed alive. However, you can certainly make the argument that the more users know about how they are targeted, the less they’ll like it, and the more they can control how they are being targeted, the less they will like being followed by a bunch of heavy-breathing marketers.

The common industry argument on why consumers should like BT is that, at its best, it will rid them of seeing ads for products they don’t care about. (If you’ve ever seen my rather full head of hair, you’ll know why I find it so hilarious when I get served ads for baldness cures.) While there’s some truth there, it just doesn’t sound like a line of thinking that will get the masses on its side. Google giving users access to their profile data, however, sounds like an idea which will.

For more on this topic, check out this post by Erik Sherman over at BNET Technology. He, too, worries about consumer backlash around the topic of behavioral targeting, but has a somewhat different take.