Your secret online profile: advertisers are tracking you online and compiling a database of who they think you are. In this essay, Jeffrey Rosen, a professor at George Washington University law school, considers what this means for our privacy and our future.

• Author: Rosen, Jeffrey
• Position: TECHNOLOGY - Essay

Not long ago, I decided to test how much privacy I have online. I cleared the cookies--the bits of code that websites leave on my computer to track what I browse and buy--from my Web browsers. Then I set out to create two new identities: "Democratic Jeff" on Safari and "Republican Jeff" on Firefox.

On Safari, I spent time on Barack Obama's re-election website and searched for Volvos and flights to Los Angeles. On Firefox, I visited Mitt Romney's site, then searched for Cadillacs and diamond rings.

Within two days, an ad for Mitt Romney suddenly appeared next to an article I was reading on Firefox. When I opened that same article in Safari, the ad in that spot was for Catholic University's master's program in human resources management.

Why did Republican Jeff and Democratic Jeff see entirely different ads? The answer is real-time bidding, a technology that's transforming advertising, politics, news, and the entire online experience. You may think you know who you but on the Web, you are being defined in ways that will determine how you interact with the digital world, and with whom.

What exactly is real-time bidding, and how does it work? A company like BlueKai, in Seattle, uses sophisticated software that sorts Web users like you and me into 30,000 categories based on our interests and spending power. These secret profiles help advertisers determine whether each of us is worth following, and at what price. If a company decides I am worth buying and wins access to me, it can bombard me with ads that will follow me wherever I go on the Web.

Here are the categories Republican Jeff falls into, according to BlueKai: "midscale thrift spender" who makes $60,000 to $74,999 a year, lives in Portland, Maine, and is interested in luxury cars, celebrities, and TV. BlueKai thinks Democratic Jeff lives in Southern California, runs a large company, and cares about advertising and marketing.

Neither profile is accurate. But the pigeonholing of Republican Jeff and Democratic Jeff is our digital future.

Google and Facebook have each been expanding their use of real-time bidding. Last June, Facebook announced a new service called Facebook Exchange, which will enable advertisers to send promotions, for example, for Spanish hotels to Facebook users who have searched for trips to Spain.

All this raises critical privacy concerns--especially since computers can now link our digital profiles with our real identities. Earlier this year, the Federal Trade Commission...