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Microsoft implements Behavioral Targeting

Microsoft has began using user surfing habits and other personal information to for advertising purposes, through the use of cookies, which are cached on the users system, Microsoft is able to link between personal information that users supply when attaining a hotmail account or other Microsoft supplied services, as well as, what websites the user uses etc and thus generate specifically targeted advertising.

Microsoft uses the information it gathers to build user categorize (e.g. +30 women who read business news), and presents advertising related to that user segment when the user visits one of Microsoft`s websites. Though this process is new for Microsoft, other industry giants have already beaten Microsoft to the process known as behavioral targeting, such companies are Yahoo and Google.

Microsoft is interested in attaining a larger share of the internet advertising market in which it is behind Google and Yahoo. Microsoft began integrating the personal information provided by its 263 million Hotmail users. When signing up to Hotmail a new user is required to fill in information such as age, occupation and address. Microsoft adds this information to the user`s online behavior (i.e. what information the user access online) and provides accurate advertising. Microsoft found that employing this tactic improves advertisement affectability by 76%. Critics say that the use of this technology allows corporations to much personal information and violates user privacy. Microsoft responded to this by saying that they believe that the system provides internet users with a better experience both in the advertising and in content and as a result people will use are websites more.