So Charter Communications has backed off plans to track the Web usage of its subscribers. It took just a month for concerned customers and politicians to convince the company to rethink a pilot program that would have monitored Web traffic in four cities.

The company had promised to keep the information confidential, only using it to target advertisements to users based on surfing preferences. Despite these assurances, critics were worried.

“The arrangement raises strikingly significant questions, such as what other uses will be made of this highly sensitive information and what measures Charter Communications is taking to safeguard such information,”Connecticut Attorney General Richard Blumenthal wrote in a letter asking Charter to drop the plan.

That such a plan would be developed in the first place is not surprising, particularly when you consider how desperate advertisers are to break through the net of distractions surrounding potential customers. They are looking for answers. Increasingly those answers involve alliances with companies in a position to know what their users like to look at and where they like to shop. Remember what happened with Facebook and Beacon, and the privacy concerns that one raised.

So what do you think? How much information should a company like Charter collect? How much categorizing and cataloging of your life is ok? Does it even matter?