Turncoat Microsoft Supports Online Ad Regulation (MSFT)

The great states of New York and Connecticut have an unlikely ally in their bid to regulate online advertising… Steve Ballmer.

Microsoft (MSFT) is not only supporting proposed laws in both states that would regulate the collecting of data for advertising purposes, it is helping law makers draft their legislation. Microsoft associate general counsel Michael Hintze explains to Adage:

We think legislation can be an appropriate part of the mix in protecting consumer privacy … It’s been a long-standing position of ours that we’re willing to at least discuss well-crafted legislation as part of a privacy solution. We’ve taken a position that we’re willing to talk with and engage in a positive manner with the sponsors of these bills.

The rest of the online ad industry–specifically Yahoo (YHOO), AOL (TWX) and Google (GOOG)–is actively opposing these laws and, through the Interactive Advertising Bureau, have arrayed a powerful lobby against them. They’d like to self-regulate, and have taken steps to convince lawmakers and the public that state or federal laws aren’t necessary.

We’d make more of this split, but given the shifting online map, it’s hard to tell how permanent it’s going to be: Three days ago, it looked likely that Microsoft was going to end up owning Yahoo; now there’s a decent chance it will be bidding for AOL. Once things settle — if they settle — this wil be worth revisiting.

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