Lawmakers and the Federal Trade Commission are being lobbied to intervene to help settle differences between some advertising industry representatives and privacy advocates over how to implement a “do-not-track” option giving consumers the choice of whether they want to be tracked online.

Many companies now track consumers by placing text files called "cookies" on their computers when they visit certain websites in order to tailor ads to them based on their preferences. In response to the growing use of online tracking for advertising and market research, many privacy advocates have called for giving consumers a do-not-track option. The idea gained momentum after the FTC first endorsed the idea in a draft privacy report in December 2010.

Some of the browser providers including Mozilla’s Firefox, Apple’s Safari and Microsoft’s Internet Explorer have begun including a do-not-track choice in their browsers. But it is unclear how websites will respond to these do-not-track requests.

The World Wide Web Consortium (W3C), an international organization that sets technical standards for the Web, has been convening talks involving advertising and tech industry representatives and privacy advocates on developing a standard for what it means to abide by a consumer’s do-not-track preference. Those talks, which have been going on for months, however, appear to have reached a stalemate and some of the parties involved are now looking outside the group for help.

Privacy advocates wrote the FTC last week appealing to the agency to intervene to help break the logjam. In their letter to FTC Chairman Jon Leibowitz, the privacy groups said the two major stumbling blocks center around the use of “unique identifiers” and the default settings for Internet browsers that include a do-not-track option.

"Consumer privacy has suffered in the technical 'arms race' between privacy tools and industry tracking practices, and we support efforts to design a consensus approach in hopes of avoiding further undermining of consumer trust online," the Center for Digital Democracy, Consumer Watchdog and the Electronic Frontier Foundation wrote. "We believe that a meaningful [do-not-track] standard that browsers enable, users understand and websites honor is the best outcome for all. Strong FTC support for the W3C process would, we hope, nip this damaging 'arms race' in the bud."

Microsoft’s announcement earlier this year that it would offer the latest version of Internet Explorer with the do-not-track option turned on has caused concern among some advertising industry officials and sparked debate over how far the W3C should go in defining do-not-track standards. Some worry that Microsoft has made the choice for consumers. Given this, they say many websites may not honor Internet Explorer do-not-track requests.

"It’s one thing to set a technical standard, but [another] to define the policy behind the technical standard," said Stuart Ingis, who serves as counsel to the Digital Advertising Alliance.

In response to concerns raised by the ad network ValueClick, advertising technology firm 33 Across and others, a group of GOP House lawmakers wrote Leibowitz Friday to voice concern with the agency’s role in the W3C process and to request details about whether it is driving efforts to restrict online advertising without adequate authority to do so.

"We are also concerned the FTC and W3C have failed to study how certain implementations of [do-not-track] could affect third-party advertising networks, the publishers who depend on advertising revenue, and ultimately the consumers who today enjoy a vibrant creative ecosystem of online applications, services and content," said the letter signed by nine House members including Reps. Tom Graves, R-Ga., Marsha Blackburn, R-Tenn., who sits on the Energy and Commerce Committee, and Dan Burton, R-Ind., a senior member of the Oversight and Government Reform Committee.

They added that the third-party advertisers and publishers most likely to be hurt by implementation of do-not-track are not “adequately represented” in the W3C process and said some companies are “using this extra-legal policymaking process to gain a competitive advantage in the marketplace.” The lawmakers sought information from the FTC about what authority it is using to participate in the W3C process, who the FTC has met with related to the W3C process, what studies it considered in endorsing do-not-track and other information.

"We’re seeing policies outside the United States influencing the economy here, through the FTC’s encouragement of the W3C process.” ValueClick Chief Privacy Office Jason Bier told National Journal.

“I’m concerned that the legislative process has been put in a forum other than where it should be -- which is Congress. I have specific concerns about what impact this could have on the U.S. economy, and the thousands of small companies and publishers that ValueClick serves may be hurt badly.”

Leibowitz has been vocal in saying that he believes do-not-track should mean that companies will not collect information from consumers except in a few limited instances. But what those exceptions should is still up for debate. The Digital Advertising Alliance argues that some tracking is necessary in some instances such as for fraud prevention, security and market research.

Adam Mazmanian contributed to this story.

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