According to the Wall Street Journal, the move meant that the online habits of most people who use Internet Exploder are an open book to advertisers.
But in 2008, Microsoft intended to give users a simple, effective way to avoid being tracked online. However the product planners lostthe debate to those who argued that giving automatic privacy to consumers would make it harder for Microsoft to profit from flogging online ads.
Now users have to deliberately turn on privacy settings every time they start up the software, something which is unknown to most people.
Simon Davies, a privacy-rights advocate in the U.K. who Microsoft consulted while forming its browser privacy plans said the original privacy plans for the new Explorer were "industry-leading".
When the Journal rang up Microsoft General Counsel Brad Smith to justify why advertising was considered more important than user privacy, he said that the company tried to "synthesise" both points of view about privacy. We think he meant that it was put into a moog until it played "Popcorn" but we are not sure.
He added that the compromise advanced both the privacy interests of consumers and the critical role advertising plays in content.
As a result, the 50 most-popular US websites, including four run by Microsoft, installed an average of 64 pieces of tracking technology each computer.
The Journal was a little spooked to discover that all the major technology outfits have a vested interest in online advertising.
Microsoft bought aQuantive, a Web-ad firm, in 2007 for more than $6 billion. Google's Chrome, that gives it new insight into Internet users' habits. Apple runs iAds, to keep an eye on its fanboys and Adobe spent $1.8 billion to buy Omniture, which measures the effectiveness of online ads.
Apparently, when executives in Microsoft's new ad business heard that the designers of Internet Explorer hatched the plan to block tracking activity, they were incandescent with rage.
In the spring of 2008, Brian McAndrews, a Microsoft senior vice president who had been chief executive of aQuantive before Microsoft acquired it, complained to the browser planners.
He said that their privacy plan would disrupt the selling of Web ads by Microsoft and other companies.
Like many people in the advertising world, he was unable to accept that the designers would do something that would stop them flogging adverts.
Smith said Microsoft weighed both sides of the argument in its debate. The powers that be were concerned about the effect strict privacy features might have on free sites supported by advertising, including newspaper sites.