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Microsoft in search for online privacy code

David Gow

Microsoft, the world’s biggest software group, is calling on the global industry and civil liberty groups to develop a common set of privacy standards for data collection, use, and protection in the proliferating field of online search and advertising.

Responding to pressure from regulators and consumer demand, Microsoft announced it would make search query data anonymous after 18 months by removing cookie IDs, the entire IP address, and other identifiers from search terms. Its new moves, which it claims will minimise the effect on privacy of the data it collects, include a commitment to store Live Search terms separately from account information such as the name, email address or phone number of users.

They come as Google, the market leader, comes under pressure from the EU working party to go further than its offer to cut the lifespan of the cookies it uploads to millions of computers to two years. They now last until 2038.Microsoft claims that its moves, including a commitment to join the Network Advertising Initiative (NAI) this year, when its begins to offer third-party advertising services, go further than previous industry practices. It says it wants to discuss these with all other players and regulators. The initiative has already won backing from search engine ask.com, a unit of the American technology group IAC.

Microsoft is investing huge efforts to catch up with Yahoo and ultimately Google in online search and advertising. Last week, as it announced second-quarter results showing a 7 per cent gain in net profit to $3 billion and sales on course to hit around $57 billion this year, it said its online services group had seen sales rise 19 per cent in the three months to June, boosted by a 33 per cent leap in advertising on the web. But the division remains unprofitable and Microsoft still ranks third in the U.S. search market behind Yahoo and Google.

Privacy and consumer groups have expressed mounting concern over the use of personal data amassed as consumers opt for greater use of search engines linked to advertising. Google’s recent $3 billion acquisition of DoubleClick, the largest broker of online banner ads, has heightened these fears and brought calls for it to be investigated by anti-trust authorities on both sides of the Atlantic. —

Guardian Newspapers Limited 2007

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