Would you choose a search engine based on what it stores -- or doesn't store -- about you? Privacy issues are getting more attention among Internet users, and becoming a greater source of competition among the big search providers. Microsoft today became the latest to announce new policies.

Microsoft says it will make data from Live Search queries anonymous after 18 months, unless individual users want them to be stored longer. According to the company, the policy "will apply retroactively and worldwide, and will include permanently removing the entirety of the IP address and all other cross-session identifiers, such as cookie IDs and other machine identifiers, from the search terms."

In addition, Microsoft says it will give people the option of excluding themselves from behavioral ad targeting, which delivers ads based on a user's past online activities. In a separate announcement, Microsoft and Ask.com today called for industry principles for data retention and other privacy practices.

Similarly, Ask.com said last week that it would "implement a new data retention standard that will completely disassociate search history from a user's IP address or cookie information after 18 months."

However, what really got the attention last week was Ask's announcement of "AskEraser," which will go further by letting people choose to avoid having their search history retained altogether. Microsoft isn't doing that, according to this New York Times story:

Asked whether Microsoft was considering something similar to Ask Eraser, Peter Cullen (Microsoft chief's privacy strategist) not only said no, but argued that too much privacy was actually dangerous. ... Anonymized search, he said, "can become a haven for child predators. We want to make sure users have control and choices, but at the same time, we want to provide a security balance."

Google last month announced its own 18-month retention policy. In its story today, the New York Times reports that Yahoo is now going further -- promising to make search data anonymous after 13 months.

The Center for Digital Democracy last year called on the Federal Trade Commission to investigate the industry's data collection and advertising targeting practices. The group singled out Microsoft's new adCenter system for criticism. In a statement this morning, the group commented on Microsoft's latest policy changes:

"Today's announcement from Microsoft acknowledges that consumers were not previously protected online to the extent that they need to be. While Microsoft is taking a step in the right direction, the updated policy is insufficient in terms of adequately protecting the personal information of online users. The industry needs to embrace an opt-in regime where no information can be collected without full disclosure to the public; otherwise the FTC and Congress must step in to protect consumers' rights where the industry has failed to do so."

Search providers say the retention of query data helps them improve their services, but there are also potential privacy risks, as illustrated by the incident last year in which AOL released research data that was able to be associated with individual users.

In its announcement this morning, Microsoft says it will store records of search queries "separately from account information that personally and directly identifies the person, such as name, e-mail address and phone numbers." In addition, the company says it will "maintain and continually improve protection to prevent the unauthorized correlation of this data."