• by Wendy Davis , Staff Writer @wendyndavis, May 25, 2016

The Federal Trade Commission plans to scrutinize online privacy notifications, the agency announced this week.

"Disclosures are ... challenging in the privacy arena, whether disclosing to consumers that their physical location or online interactions are being tracked, or explaining privacy practices when consumers sign up for a service," the FTC stated.

The agency intends to examine written privacy policies as well as the centerpiece of the ad industry's self-regulatory privacy code -- the AdChoices icon.

"Privacy policies are often long and difficult to comprehend and privacy-related icons may fail to communicate information meaningfully to consumers," the FTC said in a post announcing an upcoming workshop on the topic. "Furthermore, the accompanying mechanisms for consumers to provide informed consent or exercise choices about the use of their data may also be confusing."

That AdChoices icon, a small blue symbol in the shape of a sideways triangle -- is supposed to function as an immediately recognizable symbol of online behavioral advertising. That is, it's supposed to inform people that advertisers are drawing on consumers' Web-surfing history in order to serve them targeted ads. Clicking on the icon also takes people to pages where they can learn more about behavioral targeting and also opt out of receiving targeted ads.

While advertisers, agencies and publishers serve the AdChoices icon more than 1 trillion times each month, fewer than one in 10 Internet users know what it means, according to a 2015 report by the agency Kelly Scott Madison.

Privacy policies have long been a focus for Lorrie Faith Cranor, who currently serves as chief technologist for the FTC. Eight years ago, Cranor authored a report concluding that online privacy policies take users an average of 10 minutes to read. Cranor, who now serves as chief technologist for the Federal Trade Commission, concluded that if every Web user in the country read the policy at every site visited, time spent reading privacy policies would total an estimated 44.3 billion hours per year.

Since then, the ad tech landscape has only become more complex, making it even harder for Web companies to accurately explain their practices regarding data.

As things stand, although commercial sites tend to have privacy policies, consumers don't appear to have the slightest idea what they mean. The University of Pennsylvania's Joe Turow, who studies consumers' attitudes toward privacy, told the Pew Research Center in 2014 that privacy policies tend to be unreadable. "They are filled with jargon that is meant to be understandable only to the people writing them, or to people who work in the advertising industry today," he said. "Words like ‘affiliate’: nobody outside of the digital marketing industry knows what that means.”

In 2014, Pew reported that 52% of Americans mistakenly think the following statement is true: “When a company posts a privacy policy, it ensures that the company keeps confidential all the information it collects on users.”

Only 44% of Americans said that statement was false.

"It is clear that there is deeply embedded and long-standing confusion among consumers when it comes to privacy policies and the protections they afford," Pew wrote.

The FTC's workshop will take place on Sept. 15.