What are Cookies ?
A "cookie" is a tool used by some advertisers to track your online movements.  Physically, a cookie is actually just a file that on your hard drive.

Cookie files are associated with a specific web site and are created from visiting web sites that support cookies. They tend to contain information about your visit to the particular web site.  The next time you visit that web site (or potentially some others), that data is accessed again! 

Secret Data Stored in Your Bookmarks - the new form of cookies !
A new technique is being used to store persistent information about your web use.  Called "persistent userData" this technique is used in a fashion very similar to cookies - but instead of storing data in a separate cookie file which can be easily deleted, this method stores the persistent data DIRECTLY ON YOUR BOOKMARKS!

See Scrubbing Bookmarks for more information on how to remove this data from your bookmarks. 

See Prevent Storing Secret Data for more information on how to prevent this technique from spying on you.

"Bad" Cookies:
The most pressing issue concerning cookies centers about concern for user privacy and the potential for abuse. Advertisers are using cookies to develop detailed profiles of people and their browsing habits. Each click of an advertisement or web page can be added to a profile maintained by the advertiser. 

For the time being this information is primarily used for the placement of banner advertisements, but the possibility exists that these profiles will be sold to other commercial interests. This could lead to deeper violations of personal privacy, because if any one advertiser links a user identity to their cookie ID, then that information could also be resold. Once your identity becomes known to a single company listed in your cookies file, any of the others might know who you are every time you visit their sites.
 

"Good Cookies"
While most people believe that most cookies are an invasion of privacy, some sites will only function if cookies are enable/allowed. Online shopping carts are a primary example of this.

Since web browsers DO NOT offer anything but rudimentary cookie functions, and since there are "good" cookies and "bad" cookies that need to be handled differently, Guard-IE is required to manage them.
 

How do Cookies work ?
The easiest way to explain cookies is with a simple example. You visit a web site for the first time and you are greeted with "Welcome New Visitor". Later when you visit the same web site, you are greeted with "Welcome Back", or sometimes "Welcome Back, Lisa". The cookie file contains the information to let the web site know you have visited the site before. Some personal information is accessible off your computer, but other personal information is gathered from purchasing records or other material on the web site

Web Bugs / Web Beacons

A Web Bug (also called Web Beacon) is a small and invisible image used to track your movements on the web. On the next line we have placed a HARMLESS web bug.  Note what the bug typically looks like:

I.e. often you cannot see them because they are extremely small in size and/or transparent. Guard-IE sniffs out and visualizes bug such as these replacing the invisible image with the Roving Eye image seen below.  If you enable web bug detection, you can click such eyes to find out more information about the bug.

How does a Web Bug work?
If you visit a web site, let's say the security company located at www.GuardWall.com, then the GuardWall web server will register a generic visit. A counter is likely increased for the company to know how many people are visiting its site, but that is nothing special.

If however, every time you visit www.GuardWall.com, a picture on the GuardWall page is loaded from www.SneakyAdvertisingCompany.com, then Sneaky Ad Company also knows you visited GuardWall. These "pictures" are usually invisible and are referred to as Web Bugs.

Now imagine Sneaky Ad Company correlating millions of such visits. Add on cookie information and now it is possible for Sneaky Ad Company to know that you went to a security company, an on-line trading site, and maybe a football site.

Because of its use of web bugs and cookies, Sneaky Ad Company can now make a very detailed view of your interests based on your history of online activity and purchases. Guard-IE allows you to see these web bugs if they are hidden on web sites you visit. Since Guard-IE destroys cookies, the effectiveness of web bug snooping is limited.  However, a soon-to-be released version of Guard-IE will actually block the web bug from being loaded resulting in ever greater protection from unwanted snooping