Umair's post on ad networks being a proof of the long tail of content being quite long and Yahoo's acquisition of Blue Lithium got me thinking about ad targeting.
Behavioral/contextual/content/demographic targeting are filtering mechanisms for advertising. Filters, of course, are a key way of creating and capturing value in a long tail world. (Google AdWords is an example of the value of a good advertising filter.)
In order to be useful, banner advertising filters need data on users' behavior. A lot of users, quite rightly, don't see the benefit of giving the ad network that data but only the privacy implications. A major reason for this is the fact that the online publishers and advertising networks have done very little to earn their users' trust in this area.
The deal offered to users with regards to advertising targeting seems to be:
1) without good targeting you'll see a lot of often irrelevant adverts and the publisher will make a healthy profit
2) with good targeting you'll see some relevant adverts and quite a lot of irrelevant adverts and the publisher will make a larger profit
Not really a win-win.
But Internet users are not universally against personalization and filters. Witness Amazon which offers the deal: the more we learn about your taste and behavior, the better our recommendations will be. Yahoo, Tacoda and other companies developing behavioral targeting should be inspired and offer their users a better overall deal with regards to advertising supported content and services.