San Francisco The advertising industry has come out strongly against a Microsoft plan that would severely hamper one of the most effective and profitable forms of online advertising.

The plan would also hit the income of websites which depend on advertising and reduce the usefulness of the adverts seen by many internet users, according to the software company’s critics.

The complaints follow Microsoft’s announcement last week that the next version of its web browser, known as Internet Explorer 10, will automatically send a so-called “Do not track” request to all advertisers, unless users turn the feature off.

Advertisers who comply with the request would be unable to send tailored advertising based on a user’s browsing habits. Known as behavioural targeting, the practice results in adverts that on average sell for two and half times as much as non-targeted messages due to their higher relevance, according to the Interactive Advertising Bureau.

Significant advancement

Microsoft’s unexpected move has been welcomed by privacy campaigners as a significant advance in limiting the use of personal data, since most computer users never change the default settings on their browsers. Internet Explorer is the most widely used web browser, accounting for between a third and a half of internet traffic.

Advertising industry representatives attacked the software company for bypassing a wider initiative, involving both internet and advertising companies, of moving towards a less onerous system where users must actively request not to be tracked.

“We think Microsoft’s action is misguided,” said Dan Jaffe, head of government relations at the Association of National Advertisers in the US. “It imposes Microsoft’s views of what consumers should see” while hurting advertisers and preventing users from seeing “important and relevant” adverts, he added.

‘Do not track’

Others warned that advertisers would refuse to abide by the blanket “do not track” requests coming from IE browsers.

“Companies simply can’t afford to shut off such a substantial revenue stream for the majority of internet users — no company would voluntarily agree to that,” said Mike Zaneis, general counsel of the Interactive Advertising Bureau.

The ‘do not track’ system is currently voluntary, though pressure from regulators has been growing for advertisers to give internet users the choice of not being tracked online. Refusing to comply with the IE requests would bring a backlash in Washington and Brussels, said Jeff Chester, head of the Centre for Digital Democracy, a privacy group.

While welcoming Microsoft’s move, some privacy campaigners expressed concern that it would hamper efforts to get a wider industry agreement on “do not track” practices. They also questioned Microsoft’s motives as the change to the IE browser would have a significant impact on Google, which operates the biggest online ad-placement network, while Microsoft's own online ad business is small.

The “go-it-alone announcement suggests they are more interested in posturing and roiling Google than really protecting privacy,” Chester said.

“Short term, it gives people pause,” said Justin Brookman, head of consumer privacy at the Centre for Democracy and Technology, though he added that “the tide is turning in favour of ‘do not track.’ It’s good when browsers compete on privacy.”

— Financial Times