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Microsoft’s Dean Hachamovitch introduces IE10.

Microsoft’s decision to prevent Internet Explorer 10 users from being tracked online, by default, is getting an extraordinary response from some of the world’s largest advertisers, in the form of a letter to the Redmond company this week from the Association of National Advertisers, objecting to to the plan.

The letter was signed by representatives of companies including Intel, IBM, Johnson & Johnson, McDonald’s, General Mills and many others. At issue is the “Do Not Track” setting in IE10 and its impact on way advertisers to use information gathered about users, through their online activities, to better target advertising.

Other browser makers also offer the feature but it isn’t turned on by default. Microsoft sees the default setting in part as a competitive advantage in its appeal to get users to try Internet Explorer again. The new browser will be released in conjunction with the upcoming debut of Windows 8.

The ANA board contends in its letter that Microsoft’s plan to make Do Not Track the default will have drastic implications: “Microsoft’s decision to block collection and use of information by default will significantly reduce the diversity of Internet offerings and potentially cheat society of the robust offerings that are currently available.”

Ed Bott of ZDNet picks apart the ANA’s arguments, pointing out that an end to tracking doesn’t mean an end to the advertising industry. “Ad-supported television networks are able to survive without having any form of data collection to target ads to individual sets,” he writes. “Why is Internet advertising different?”

A Microsoft representative reiterated the company’s previous statement: “Our approach to DNT in Internet Explorer 10 is part of our commitment to privacy by design and putting people first. We believe consumers should have a consistent experience and more control over how data about their online behavior is tracked, shared and used. We also believe that targeted advertising can be beneficial to both consumers and businesses. As such, we will continue to work towards an industry-wide definition of tracking protection.”

Also see this June post by Brendon Lynch, Microsoft’s chief privacy officer.

The widely used Apache web server software will be set to override the privacy setting in IE10, calling Microsoft’s actions a “deliberate abuse of open standards.”

The dispute is remarkable in part because Microsoft is nominally a member of the Association of National Advertisers. It’s also amazing to see IE — one of the programs that was at the center of Microsoft’s U.S. antitrust case — now being used by the company to advocate consumer rights.

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