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The Wall Street Journal calls cookies that track consumer browsing habits Internet spying. Photo credit: CC by TheeErin/Flickr photo.

BlueKai Inc. became the center of the perfect digital storm on Tuesday. After BlueKai’s CEO was quoted in a Wall Street Journal piece on Internet spying, the Bellevue, Wash.-based data exchange company became one of the hottest topics on the Internet. The Journal article is the first in a series that says cookies that gather data about browsing habits are “spying on consumers.” BlueKai CEO Omar Tawakoi disagrees with the Journal’s take, saying that calling cookies Internet spying is misleading and damaging to the online industry.

BlueKai cookie data targets browsing habits

BlueKai was founded in 2008 to exploit an online marketing niche Tawakoi calls “data exchange.” TechFlash reports that BlueKai compiles anonymous customer data collected from cookies on leading travel, automotive and retail sites. BlueKai then creates an online auction where advertisers bid on the data. Advertising networks pay for the BlueKai cookie data because they can target people whose browsing habits indicate they may have a real interest in buying a specific model of car or a flight to a select vacation destination.

Online data exchanges booming

Each day, BlueKai sells 50 million pieces of information about the browsing habits of specific individuals, according to the Wall Street Journal. Its series, billed as an investigation on the business of spying on Internet users, reports that data collection on consumer browsing habits has grown more intrusive than most people realize. The newspaper conducted a study that found the nation’s top 50 websites installed an average of 64 cookies per user, usually without warning. Cookies scan what people are doing and assess location, income, shopping interests and medical conditions. These profiles are marketed on stock market-like data exchanges by companies like BlueKai.

BlueKai cookies a good thing, says CEO

BlueKai CEO Omar Tawakoi fought the Journal with a rebuttal published on Advertising Age. He said cookies enable advertisers to produce more relevant ads and ensure that consumers see them just the right number of times. Plus, the proceeds help pay for the content. He said a “less polarizing” discussion would be helpful and that the Journal calling cookies spying is “misleading at best and damaging to the online industry at its worst.” His solution, which BlueKai already provides with an online registry, is to make the online data collection process more transparent. BlueKai shows consumers exactly what is known about them and gives them control over what data they will allow the company to use.

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