Is Orbitz being creepy or smart?

The Wall Street Journal has been doing very good work in recent years on the issue of digital privacy, exposing how Web and wireless companies secretly amass profiles of their users to further their own interests. Tuesday’s contribution was a story noting how the travel site Orbitz often displayed more expensive hotels in search results for Mac users than for PC users.

This revelation sent chills down the spines of some privacy advocates. Here’s how Wendy Davis of the Daily Online Examiner put it:

“[J]udging by today’s headlines, Orbitz is fast on its way to becoming poster child for everything people find creepy about online advertising.”

That “creepiness” might in itself be cause for concern, says Ryan Calo, a privacy expert with Stanford Law School’s Center for Internet and Society. “The fact that people are creeped out by this is legitimate, and itself registers as a privacy harm,” says Calo. He adds that if people don’t understand how sites are arriving at prices, or feel like they’re being manipulated, they might stop transacting business online.

Be afraid, be very afraid! Or not.

As Orbitz told the Journal, there’s no differential pricing at work. Individual hotel rooms are offered for the same price to all users, no matter whether they’re using a Mac or a PC. All Orbitz is doing is juggling the order of the search results to try to show people the hotels they’re most likely to be interested in, based on the choices other users like them have made. As has always been the case, anyone who wants to arrange the listings by price needs only to look for the “Sort by” buttons at the top of the results and choose “Lowest price.” Doing so defeats the profiling, er, targeting.

Now, there might be an interesting argument to be made about the public’s expectation for search-engine neutrality. But if people really do expect that, then they must not be using Google, which manipulates its search results in some fairly obvious ways.

And there’s nothing inherently dishonest about Orbitz or any other website trying to tune their search results to their users’ preferences. Consumers tend to judge sites on how long it takes them to find what they’re looking for. Orbitz wants users to find something appealing right away, which is why it uses several factors to tweak its initial search results. According to the Journal, these include the user’s location, previous bookings and available discounts in addition to the user’s operating system.

The competition for online travel deals is intense, so if Orbitz’s targeting really does creep people out, then the company will have to mend its ways or risk losing market share. My guess, though, is that the public won’t judge Orbitz that way. Instead, the test will be whether the targeting helps people find what they’re looking for faster than other sites, and whether Orbitz offers better deals.

And if Mac users think they’re being taken for suckers, well, the data show they’re bigger spenders than PC users. Considering that Macs have always carried premium prices, is that really much of a surprise?

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