Online Privacy: Clarifying the Issues, Building Consensus – An Update from Microsoft and

September 2007

In July 2007, Microsoft Corp. and called on the online services industry to develop global privacy principles for data collection, use and protection related to search and online advertising. The two companies committed to engage in a dialogue with other technology leaders, consumer advocacy organizations and academics to help encourage development of global privacy principles for data collection, use and protection related to search and online advertising.

Discussions have ensued over the past three months with stakeholders, including policymakers and data protection agencies worldwide. In Montreal on Sept. 27, industry leaders and consumer advocates convened to discuss privacy issues surrounding search and online advertising at an event sponsored by Privacy International.

“The Montreal meeting brought together many key participants in the online advertising and search markets, who increasingly recognize the importance of privacy in online advertising and search,” said Simon Davies, director of Privacy International. “The participants brought different perspectives, which underscores the need for continuing dialogue. This meeting was a good start.”

More such events are planned in the next few months. The Federal Trade Commission will host a Town Hall Nov. 1–2 to address consumer protection issues. On Nov. 8, Microsoft, and others will participate in a roundtable hosted by New York University School of Law on the privacy issues surrounding online search. Also since July, many informal discussions have been held with industry leaders, privacy advocates and other stakeholders.

Already, dialogue has helped identify a need to start with a common understanding of key concepts. Some privacy concepts mean different things to different people. For example, some companies regard data as anonymous if only part of a computer user’s Internet Protocol (IP) address is associated with it. Others have discussed removing the entire IP address and all cross-session identifiers when they anonymize the data.

“When it comes to many privacy issues, working together makes sense,” said Doug Leeds, vice president of product management at “Industry communication is critical to helping support and amplify a sense of trust and integrity in the online domain. By laying some basic foundations around privacy, we can act positively on issues of online integrity for our users and for customers worldwide. We believe, more than ever, that the privacy and trust dialogue is moving forward, with the needs and expectations of our users in mind each step of the way.”

“It is important that industry come together around a common understanding of a set of best practices,” emphasized Peter Cullen, Microsoft’s chief privacy strategist. “We need to do the right thing for consumers on privacy. The goal is to provide consumers with greater transparency and control.”

In addition to Microsoft and, others in the search and online advertising industry, such as AOL, Yahoo! and Google, have addressed related privacy issues in the past few months. The good news is that privacy in online advertising and search is on the agenda. Microsoft and are cautiously optimistic that we will continue to progress toward industry principles.

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