I usually don't write about rumors, but reports that Google (GOOG) may be working on a replacement for tracking cookies is worth speculating about because it can have enormous implications when it comes to our online privacy.
There are reports that Google is working on something called AdID which would transmit anonymous user data to advertisers who agree to some basic privacy guidelines. USA Today quoted a source saying that the new technology would give users more control over information collected by them when they browse the web.
As background, a cookie is a tiny little text file that websites can put on your computer's hard drive to identify you. If you've ever had your user name automatically entered when you visit a site, it's probably because they put a cookie on your machine with an encrypted version of that information. Hardly anyone complains about those types of cookies because they're there for our convenience.
Third-party tracking cookies, though, aren't as sweet because they're put on our machines for the convenience of advertisers. What a tracking cookie does is keep track of our browsing history so that advertisers can target their messages. Site operators cooperate with each other so your activities are tracked as you go from site to site.
A few weeks ago I bought a upright freezer and, naturally, I did my research online, visiting Amazon.com, Sears, Lowe's and other retail sites. I also read up on freezers on various advice sites. And, almost by magic, I started seeing ads for freezers on lots of sites, including news sites that -- as far as I know -- don't write about or sell freezers. It's no coincidence. The reason I saw those ads is because a tracking cookie notified those sites of my Web history, which caused them to automatically target the ads.
A lot of privacy advocates are alarmed about cookies because they keep a record of where you've been on the Web. The advertising companies that put them there, though, argue that the tracking is anonymous -- sure the cookies target ads based on your behavior, but they don't disclose who you are. In other words, the companies that pushed me those freezer ads don't know that Larry Magid was shopping for a freezer, only the browsing habits of an anonymous user of a machine.
Some privacy folks will counter that there are ways to correlate all this data to know the real identity of the user, and they're probably right. But just because that's possible doesn't make it likely to happen. Still, I understand and respect those concerns, which are why I think users should have a lot more control over what information is collected about their Web use. It should be easy to know if you're being tracked, it should be easy to prevent being tracked and it should be very easy to cover your tracks and delete the cookies.
Of course even without cookies they can show you contextual ads. If you search for "Hawaii" on Google and you get a hotel ad, that's not because of tracking, but because your search term clued them into what you're interested in. If you're reading an article about baseball on a sports site, the site doesn't need a cookie to know you might be interested in buying a book about baseball. And -- because even without cookies -- it knows your location from your IP address, it wouldn't be unreasonable for it to offer you a ticket to a local game.
There is certainly a consumer interest in improved Web privacy. A recent U.S. consumer data privacy survey conducted by TRUSTe found that 80 percent of U.S. consumers are aware that they are tracked by advertisers while 52 percent don't like the concept of online behavioral advertising. More than eight in 10 (82 percent) of Internet users said they had deleted cookies and 68 percent said they've used a browser privacy add-on/feature for ad-blocking or anti-tracking. It's too early to know what Google might have in mind with its AdID project and, because it's Google, some people will naturally be distrustful. If it can find a way to allow sites to keep money flowing in while giving users more control over their privacy, it could be welcomed by both businesses and privacy advocates. But if it makes it even easier for companies to pry into our lives and habits, it would be yet another unwelcome intrusion.
Disclosure: Larry Magid is co-director of ConnectSafely.org, a non-profit Internet safety organization that receives financial support from Google. Contact Larry Magid at email@example.com. Listen for his technology chats on KCBS-AM (740) weekdays at 3:50 p.m.