For a while there, it looked like the online advertising industry was going to catch a breather as Mozilla worked on a new cookie policy. Its vacation was cut short, however, as Mozilla recently announced its partnership with Stanford on what its calls a “Cookie Clearinghouse.”

The Cookie Clearinghouse is software that’s designed similarly to adblocker software. In short, it will create a cookie block-list based upon certain criteria while giving users control over which cookies are blocked. It seemed like a better alternative to just outright blocking all third-party cookies, but the advertising industry says the new policy is still harmful.

In a new blog post from the Interactive Advertising Bureau, its president and CEO, Randall Rothenberg, says that Mozilla’s cookie policy is like a “kangaroo cookie court.” In other words, he says that Mozilla cookie policy is still bad, and that it might be even worse because it creates “an arbitrary group” that determines “who can do business with whom.”

Do you think the IAB is right to be concerned over the cookie clearinghouse? Let us know in the comments.

Rothenberg goes on to say that Mozilla is not honoring the DAA Principles – self-regulatory guidelines that the advertising industry has agreed to abide by – in its new Cookie Clearinghouse:

We admit we were hopeful when Mozilla proffered that its new system for managing cookies would make exceptions for “sites complying with DAA opt-out and supporting DNT.” But its proposal does nothing of the sort. Hundreds of companies, representing thousands of Web sites, belong to the DAA program; yet their advertising will be peremptorily blocked by Mozilla’s system. Tens of millions of consumers who have visited the DAA site and affirmatively opted to do nothing — effectively choosing to allow ads relevant to them to be delivered — will find their choice sabotaged. And Mozilla’s argument that sites “supporting DNT” may still be able to deliver relevant advertising is disingenuous. Since there is not yet a consensus definition for DNT – partly because Mozilla allies have so mismanaged or undermined the process for reaching consensus – it’s not currently possible for sites to support it.

At this point, Rothenberg is right. Mozilla’s system treats a non-choice as a vote in favor of no tracking in Mozilla’s new Do Not Track options. The IAB feels that a non-choice should mean that a consumer is fine with being tracked. They will only not track when the user explicitly states that they don’t want to be tracked. Mozilla’s system allows this explicit option, but it’s set to say nothing (i.e. don’t track) by default.

Rothenberg also says that Mozilla’s new system will keep small publishers and advertisers out of the online ad game by becoming a gatekeeper of sorts:

Worse, there is nothing in the Mozilla system that recognizes, let alone offers solutions for, the particular needs of the many thousands of small publishers and retailers that depend on the Internet supply chain and the third-party cookies that, however imperfectly, are a central component of it. By making it punishingly difficult for advertisers to reach highly engaged audience segments through small publishers dependent on this third-party-cookie supply chain, Mozilla’s new system will prompt marketers to concentrate their ad buys among a tiny handful of giant Internet companies that dominate the deployment of first-party cookies. This fear has led almost one thousand “long tail” Internet companies to sign a petition asking Mozilla to reconsider its determination to block third-party cookies by decree.

The difference between Mozilla and IAB’s philosophies on DNT illustrate that W3C and advertising industries still can’t agree on what DNT means. Both sides also accuse the other of sabotaging the DNT negotiations. In short, we’re not getting anywhere anytime soon and IAB feels that Mozilla is going around everybody in its push to block cookies:

The open-source Internet supply chain is a wellspring of strength; it has fostered one of the greatest fast waves of economic and cultural innovation in modern history. It is also a source of weakness, because it creates vulnerabilities in securing individuals’ and companies’ data and in assuring their desire to keep certain activities and interests private. But acknowledging and correcting for those weaknesses doesn’t require taking a blunt sledgehammer and destroying the digital supply chain. Rather, we need rational, consensus solutions that will meet all major stakeholders’ needs.

That Mozilla doesn’t understand this is unsurprising. After all, it represents nobody. It is part of a global distribution cartel whose members have been in a perpetual state of war with each other for 15 years. Browser makers should not be dictating the kind of economic and cultural policies Mozilla is trying to implement any more than television set manufacturers should be deciding which shows make it to your home.

Pretty strong words, but Rothenberg does have a point. The Web is big enough for everyone. As we’ve pointed out before, the Web remains largely free thanks to advertising. That being said, we can’t ignore the legitimate privacy concerns that online ad tracking presents. Both sides need to come to an agreement before something irreparably breaks.

Do you think the ad industry and privacy proponents can come to an agreement? Is Mozilla moving too fast by introducing the cookie clearinghouse before a potential agreement can be reached? Let us know in the comments.