Sounds like they gather your full browsing history, and then assist 3rd-party ad networks in targeting their ads at you. Or, worse yet, just hand over your browsing history for ad networks to process. Their marketing materials don't seem to make this clear.
AT&T refers to the ad targeting as "Internet Preferences": http://www.att.com/esupport/article.jsp?sid=KB421828&cv=812&...
Sounds like they gather your full browsing history, and then assist 3rd-party ad networks in targeting their ads at you. Or, worse yet, just hand over your browsing history for ad networks to process. Their marketing materials don't seem to make this clear.