Category: broadband

Ad Age editorial attacks my "Digital Destiny" book

Trade publications are designed to be part of an industry’s political self-defense system. So it isn’t surprising that Advertising Age has an editorial in its new issue attacking my “Brandwashing” critique. Interestingly, it avoids addressing the many facts I cite in the book, including how advertisers are using brain research, virtual reality, and a marketing is everywhere/all time “360 degree” approach [the 360 term is what the ad industry calls its new strategy]. It’s interesting that the magazine’s editorial writers–probably on behalf of the industry–don’t want the public to ask the serious questions which are raised in the book. Here’s how they rationalize data collection propelled interactive, virtual reality-driven, personalized ads targeting us via PC, mobile, and TV:

“Making marketing more effective is what marketers are paid to do. And as long as they operate within legal and ethical bounds, they should be allowed to. While privacy is a legitimate concern, there’s something to be said for targeted ad messages. What would the average person rather be subjected to, an annoying random pop-up or an ad message tailored specifically for her? (Numerous studies have answered that seemingly obvious question.)

Finally, what consumers and activists seem to forget is that the only reason media content is free or affordable for so many is that major corporations foot the majority of the infrastructure and production bills. Then again, we could turn everything over to the government, which would no doubt create wholesome content at minimal cost to the taxpayer, all the while respecting consumer privacy.”

Have no fear—as we promote the book we will raise all these issues: privacy, manipulation, stealth marketing, immersive applications, brain research, vulnerable consumers. That’s why we are going to the Hill as well!
Source: “Brandwashing? Not Even Close.” Advertising Age. January 15, 2007

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The Brandwashing of America: Micropersuasion in the Digital Era. Adapted from my new book, Digital Destiny

(The following commentary was published by Advertising Age online, Jan. 9, 2007)

‘Digital Destiny’ Author Jeff Chester on How New Media Is Causing the Brandwashing of America

By Jeff Chester

Published: January 09, 2007

We are witnessing the creation of the most powerful media and communications system ever developed. A flood of compelling video images propelled by the interactivity of the internet will be delivered though digital TVs, PCs, cellphones, digital video recorders, iPods, and countless mobile devices. These technologies will surround us, immerse us, always be on, wherever we are — at home, work or play.

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Jeff Chester is the executive director of the Center for Digital Democracy, Washington a nonprofit policy group focusing on digital communications. | ALSO: Comment on this issue in the ‘Your Opinion’ box below.

Related Story:

America Is Being ‘Brandwashed’ Claims Author
Jeff Chester Says Ad Industry Secretly Tracks Consumers

Following our travels
Much of the programming will be personalized, selected by us with the help of increasingly sophisticated, but largely invisible, technologies that will “sense” or “know” our interests, dislikes, and habits. Information about our travels — in cyber and real space — will be collected and stored, most often without our awareness. Our personal data will be the basis of computerized profiles that quickly generate commercial pitches honed to precisely fit our psychology and behavior.

A ubiquitous system of micropersusaion is emerging, where the potent forces of new media are being unleashed to influence our individual behavior. From the ad industry’s initiatives to better perfect measures such as “engagement,” to the MI4 research effort (Measurement Initiative for Advertising, Agencies, Media and Researchers) to harness the power of the unconscious mind, to the rapid evolution of “rich media” virtual applications, a marketing technological “arms race” is underway that will further permeate advertising and marketing in our daily lives.

Wherever we are — online or in the street connected by mobile devices — Americans (and much of the world) will be increasingly influenced by the technologies of digital marketing. Such a system will be greatly aided by the scores of supplemental “real world” marketing efforts, including teams of viral street marketers and brand evangelists (many of whom are not yet old enough to vote!).

Increasing power
The ad industry likes to claim that the public has more control over what advertising they see or whether they like it at all. Many Ad Age readers point to the increasing expansion of the media and argue that advertising is now less powerful. But such assertions are disingenuous. Fueled by global media consolidation, advertisers are now working even more closely with content companies. Product placement has morphed into “program” placement and beyond. Like radio and the early days of broadcast TV, marketing, distribution and content are increasingly seamless. The broadband internet, digital TV and new forms of mobile communications are all being shaped by the forces of marketing. As I argue in my new book, “Digital Destiny: New Media and the Future of Democracy,” advertising is becoming more powerful, not less.

In the book, I chronicle the ad industry’s role in helping shape the early development of the internet, including how groups and companies such as the Advertising Research Foundation (ARF), Procter & Gamble Co., and The New York Times promoted what was once called the “Internet Advertising Ecosystem.” It covers the evolution of the “one-to-one,” “new media” marketing paradigm that still serves as the industry’s basic digital blueprint (further fueled today by sophisticated off- and online data collection, web analytics, interactivity and the branding power of video). The ad industry’s substantial research and political infrastructure — including ARF, Association of National Advertisers, American Association of Advertising Agencies, Interactive Advertising Bureau, its many councils and committees and global groups such as Esomar — are also explained.

From online “behavioral targeting” to interactive ad networks to “virtual hosts” and other “socially intelligent interfaces,” the book attempts to lay bare what marketers plan for the country’s “digital destiny.” Although readers of Ad Age know well what is now underway and its likely impact, the public is largely uninformed. One of my goals is to encourage a meaningful national debate about the current direction of the ad and marketing industry and its impact on society.

Let consumers decide
One of the most serious concerns is about privacy. Most marketers and advertisers are opposed to permitting consumers/users to have real control over their data. They want the default to be the collection of information so we can be precisely targeted. That’s why privacy groups, including my own Center for Digital Democracy (CDD), want Congress to pass legislation requiring a full disclosure of what information is being collected, via what method, and how it is to be used. After examining such details, each consumer would decide on a periodic basis whether to agree to permit the collection of their data (known as “opt-in”).

The current “opt-out” system, where consumers have to proactively seek to place their personal information off-limits, is designed to ensure that most consumers consent by default to data collection. New threats to our privacy from marketers and advertisers have emerged, including behavioral targeting, online retargeting (where consumers are digitally shadowed over ad networks), and the emergence of “intelligent ad engines” placed in cellphones and other mobile devices.

Recently, CDD and the U.S. Public Interest Research Group jointly filed a petition with the Federal Trade Commission asking the agency to declare many of today’s interactive advertising industry practices, including behavioral targeting and virtual advertising, unfair and deceptive. It appears that the FTC is now slowly lifting its head out of the digital sand to seriously investigate the industry based on our complaint. But it will take prodding from the new Congress to get the FTC to act.

Safeguards for new technology
Beyond privacy, interactive-marketing technologies also raise unique concerns about “vulnerable” populations. Unleashing personalized and cyber-virtual marketing to children, teens, prescription-drug users, and the elderly raise important questions related to public health. These groups will need to be protected with new safeguards. But even more is at stake. The entire system of interactive advertising must become more transparent and requires intense public scrutiny, debate, and — where needed — effective public policies.

For example, advertisers are now working to harness the power of our emotions through research on “neuroscience” and “psychophysiology.” As the ARF and AAAA explained in 2005 during Advertising Week, the industry wants to “capture unconscious thought, recognition of symbols and metaphors.”

“Emotional responses can be created even if we have no awareness of the stimuli that caused them,” the ARF and AAAA noted. Such potential manipulation of a consumer’s unconscious will be even more powerful when delivered by virtual agents (such as avatars) that have been fashioned (via data profiling) to dovetail with our desires and interests.

What’s the long-term impact?
I fear that such a powerful psychosocial stealth-marketing machine, backed by the yearly expenditure of many billions of marketing dollars, will drive personal consumption to greater excess. What will be the impact on our environment, such as global warming, as a steady stream of interactive marketing messages are planted deep into our brains wherever we go? Will the digital push to buy and positively associate with brands promote an even more narcissistic human culture? What will be the impact of our personalized communications marketing system on the healthy development of children, families and communities?

The ad and marketing industries have an important role to play in our society, especially helping financially support news, information, and entertainment services. I recognize that advertising will continue to be a very powerful force in our lives. But marketers need to demonstrate greater social responsibility. They must ensure that consumers fully understand and consent to digital techniques; make certain that approaches to target our emotions and other brain behaviors are truly safe (including the impact of virtual reality); and, most importantly, help our media system evolve in a way that strengthens civil society.

Such a goal is not for the U.S. alone, but also involves how the marketing industry serves the public in the developing world. For example, what will be the impact on the world environment as China’s emerging digital infrastructure is bombarded with one-to-one commercial messages promoting automobiles?

The creation of a broadband media system will be viewed by future generations as one of our society’s most significant accomplishments. Will it be seen as one of the highest achievements for a democracy, a place in cyberspace that helped enrich the lives of many and offered new opportunities for an outpouring of cultural and civic expression? Or will it been seen years hence as a new version of what the late scholar Neil Postman aptly described as a medium even more capable of “amusing ourselves to death”? The readers of Ad Age will help determine that answer.

~ ~ ~
This column was adapted from Mr. Chester’s new book “Digital Destiny” (The New Press, 2007).

Beware the “new” AT&T: Time for a national citizens’ “Broadband Watch”

Fresh from its merger approval by the FCC, AT&T (nee SBC) took out a two-page color ad in the New York Times today. Their PR pitch floats over a picture of our planet’s atmosphere. Like fellow broadband super-monopolist Comcast, the “new” AT&T clearly has imperial ambitions. It desires to dominate both network connections and digital content.

Read their ad copy to see what I mean: “AT&T, BellSouth and Cingular have come together. Creating the nation’s largest provider of broadband, wireless and voice services and the world leader in IP networking. Three companies, now united to deliver the complete picture of communications and entertainment to every screen…”

Note the word “entertainment,” signaling the real goal for the broadband giant. They will use their network power to push all kinds of programming which pleases big brand advertisers and major content producers (think Viacom, Fox, etc).

The FCC should have rejected the AT&T/BellSouth deal. Commissioners Copps and Adelstein did what they could—heroically so. But the multimedia mega merger illustrates why public interest advocates must push for anti-trust and merger reform for the media and telecommunications sector. Otherwise (as I note in my new book), we will soon see phone and cable companies merge with new media companies (think Yahoo! or Google) and also swallow up newspapers, broadcasters and the like.

But we can’t count on the policy process to deliver any semblance of real reform. That’s why activists need to examine closely how AT&T and other broadband giants operate the network. It’s not the private fiefdom of AT&T, Comcast, Time Warner, etc. The digital media system is also a public trust, requiring serious citizen and activist oversight. From issues related to network capacity, to deals made with content providers, to how phone and cable companies address public interest content online, via mobile device, and with digital TV, this network (like this Land) is yours and mine. In each community, teams of activists should work with experts to monitor what AT&T and others do—reporting the good, bad, and ugly to city councils, the press, etc. We must proactively redistribute the balance of power when it come to how broadband serves the U.S. public.

Time Magazine: You’ve Got Hypocrisy

Time’s person of the year issue named You– and everyone else—as its annual award recipient. Hailing what it called “Citizens of the New Digital Democracy,” the Time Warner flagship publication breathlessly published a series of exuberant articles about how the new media is dramatically changing our country and the world. “You control the Information age” claimed the magazine headline, complete with a mirror-like cover device so you could admire yourself. But the failure of Time to seriously address the key issues raised by Web 2.0 and broadband illustrates the many hurdles to overcome if we are to have any semblance of a digital democracy.

Perhaps the best example of Time’s failure to truly be honest with readers/users was its failure to address the elimination of network neutrality. Time magazine’s parent company is one of the corporate leaders opposed to an open and non-discriminatory Internet. Time Warner is part of the cable industry lobbying apparatus that has eliminated broadband non-discrimination in the U.S. If Time Warner–and its allies Comcast, Verizon and AT&T–have their way, a handful of cable and phone conglomerates will actually determine much of our digital destiny. These old media giants want to extend their monopolies into the digital era, ensuring that their content receives preferential treatment; that broadband becomes a pay as your surf and post toll-road; and that they become powerful barons of the digital domain.

Time magazine should have acknowledged that its parent company is opposed to limits on media consolidation. It wishes to own as much of cable as it can (so it could continue to swallow up cable systems, such as what it and Comcast recently did when they carved up giant Adelphia cable). The magazine should have acknowledged that its parent once before had predicted great things for the U.S. public with new media—when AOL and Time Warner merged in what was then the largest media merger in U.S. history. It should have acknowledged the numerous lies given by Time Warner executives to shareholders, consumers, and policymakers when it claimed to be a sound and public-minded deal.

The cover story should have acknowledged how the new media poses great threats to our privacy, as data is collected about our every move by AOL and many others. It should have discussed how Time Warner’s AOL made public our personal search data, and also turned over records about our searches to the Bush Administration. Instead of mindlessly claiming that to see the future of our media we should look at raw videos on YouTube, it should have said that the public should learn about how Time Warner’s interactive ad subsidiary—Advertising.com—targets us with personalized digital marketing.

As we discuss in our new book—out tomorrow—much of today’s new media “vision” is driven by a desire to create a stronger mechanism for personalized and targeted interactive marketing. Companies such as Time Warner, Google, and Yahoo want to combine the branding power of video with the data collecting and interactive capabilities of the Internet. It will be a digital democracy shaped by Madison Avenue. That was the vision originally developed for our new media future by AOL and Time Warner’s leaders Steve Case and Richard Parsons. Much of Web 2.0 is based on that vision: a system designed to promote the “brandwashing” of America.

Yes, we have endless possibilities with new media, including the Web 2.0 paradigm. But powerful political and economic forces will shape what ultimately develops. If Time Warner has its way, they will hold a key copyright over our digital democracy.

New York Times and Network Neutrality: Great position. But the paper needs to disclose its own conflicts on the issue

This week the New York Times editorial page weighed-in to support national legislation requiring network neutrality (“Protecting Internet Democracy,” January 3, 2007. Reg. may be required). We share those sentiments, of course. It’s time for a law that restores and extends Internet non-discrimination in the U.S. But we also believe that news organizations need to inform readers/viewers/users about how their own corporate relationships are affected by communications policy issues. The New York Times Co. is staking much of its future on digital media, including interactive advertising. For example, it acquired the About.com informational web service in 2005 for $410 million. The goal, said Times Co. officials, was to “increase the company’s revenue from the expanding online advertising business.” The Times Co. has historically been a leader in developing interactive marketing techniques, including so-called “surround sessions” which enable advertisers to digitally follow New York Times online users as they access the paper electronically. Indeed, as we cover in our new book, Digital Destiny, the Times Co.’s Martin Nisenholtz (who heads its digital operations) has been a key ad industry leader promoting the advance of interactive data collection and personalized targeted marketing. Few Times readers and users really understand what the Times Co. is doing with all this data in the service of its advertisers.

The Times Co. requires network neutrality—otherwise it knows it will have to pay a digital version of the Mafioso-like vig to Comcast, Time Warner, Verizon and AT&T. The major phone and cable conglomerates want to charge everyone an assortment of fees for higher-speed Internet distribution, creating a de facto pay toll road for broadband. Given that everyone will be distributing video-centered multimedia to TV’s, cell phones and PC’s, having such “premium for a price” Internet access will be a necessity to prosper in the Web 2.0 and beyond era. Therefore, the Times Co must have network neutrality if its investments in About.com and other “new media” related strategies will return the profits to help support its journalism (which is a key reason why the country requires network neutrality. Without it, serious journalism will be in future jeopardy—as it is today).

Today, the Times reported that its parent company was selling off its television station group. It’s another indication that the Times Co. (wisely) understands its future lies with broadband. But the success of such a business model depends in part on an open Internet. We believe that the Times should have explained to its readers that when it supports network neutrality, it has its own financial future at stake. The paper, and the rest of the Times properties, should also begin to inform its users about the range of data collection and targeted electronic marketing its doing. Complete and full disclosure should be the rule—not an after-thought serving as fodder for bloggers.

As Progressives Plan to Meet in Memphis, it’s Time to Look Beyond Policy

We are heartened by the upcoming conference on media reform coming up Jan. 12-14. But the focus of the conference should be to look beyond Washington for answers. The communications industry is already defining our emerging digital media reality through major investment and mergers. Washington—even under the Democrats—can’t really help in the short-term. Media industry leaders know this—that policy is largely irrelevant at the moment. Yes, we should fight for network neutrality, access for low-income Americans and oppose big mergers. But we must also address how the public interest can be best served in this broadband media “anywhere, anytime” era. It requires, in our opinion, a proactive effort to shape the marketplace. If we are going to have a media system which provides serious news, as well as promotes ideas which puts people first (think health care, employment, education and peace), we need to work together to help create it.

The theme for Memphis should be to both address policy and market activism. Otherwise, we won’t make the progress we so desperately require.

MSN’s Holiday Challenge: Using Sweepstakes to Collect Your Data for Uncle Bill. Not Santa

The new sweepstakes run by Microsoft’s MSN unit–Holiday Challenge [‘Win Up to $50,000]–is emblematic of one of the key ways online marketers collect your personal and related data. Hey, they say. `Wanna win some big bucks?’ Just fill out the form to play. They assume, natch, that you won’t be clued in to the data collection and branding game going on. They don’t make much of the lifeless link which takes you to its privacy “Highlights” page (you have to click again after that if you want to reach the full privacy policy pages). Once enrolled in the game, Microsoft will be able to learn about your behavior online at various MSN pages–all the while you have to endure rich media/search engine pitches for products.

Microsoft, we know, is now seeking to develop a business model for the always-on era. Selling software can no longer cut it as a steady and significant revenue source. But Microsoft should do this in a way that makes it the corporate leader fostering privacy online–as well as supporting content and culture that enriches democracy. Its new sweepstakes ploy reveals a cynical lack of both imagination and commitment to do something better.

Follow the Data—N.Y.Times Overlooks

Today’s business story on Microsoft’s online business honcho Steve Berkowitz over-looked a key critical dimension with what is really going on at that company. Microsoft is now focused on interactive advertising–and data collection–as a primary source of revenue. Microsoft has turned every bit of itself into a system that serves the needs of its adCenter [Microsoft Digital Advertising Solutions]. As we explained recently in a complaint to the Federal Trade Commission, Microsoft’s bundling of search, rich media, user-generated content (blogs, videos), email, instant messenger, etc. to help collect the data used for advertising microtargeting is on the cutting-edge of what threatens consumer privacy, in the U.S. and everywhere else.

We hope that the news media will look closely at its own operations as its relates to interactive marketing and privacy. Everyone, including the New York Times, is engaged in interactive data collection and ad schemes that threaten our privacy. Perhaps if business reporters, editorial boards, and executive producers were willing to cast a critical eye at themselves in this regard, we would have business stories that got to the core of what is driving e-commerce today.

“Looking for a Gambit To Win at Google’s Game.” Saul Hansell, NYT. 12/9/06

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Time for a Bold Public Interest Media/Telecom Agenda

We hope readers will look at Matt Stoller’s blog and his important piece entitled “On Building a Progressive Governing Coalition Around Net Neutrality.” It should be a part of a much larger debate about what should be done—at this critical juncture with our digital media system—to ensure that it truly serves democracy. We believe that there now must be a major push—in Congress and the marketplace–to advance a comprehensive agenda that will:

• require broadband content non-discrimination;
• invest in digital content services designed to foster news and public affairs;
• invest and support digital media services owned by women, persons of color, and low-income Americans;
• “save” newspaper journalism through changes in tax laws, SEC rules, and via new policies encouraging employee and non-profit ownership;
• expand “universal service” so that everyone who cannot afford it receives free residential broadband service;
• open up Internet-connected cell phone/mobile platforms (the “deck”) and digital cable and satellite services to all broadband content (in other words, ensure network neutrality gets content wherever the Net is—not just on PC’s);
• foster the development of financially sustainable and diverse Web 2.0 social networks which build communities of interest that can help organize for a more equitable society;
• enact privacy and interactive advertising safeguards so that we aren’t digitally “shadowed” online from marketers and government. This will also act as a check against the stealth machinery promoting consumption that has been placed throughout our digital environment. [We know more must be added to this draft digital media agenda].

In the next few months, it will be important for all the groups and individuals concerned about the U.S. media system to come together and foster a serious plan and strategy. One reason why some groups haven’t focused on the emerging threat to democracy in the digital era [such as the loss of broadband content and network non-discrimination due to cable/telco lobbying the Bush FCC] is that advocates [including myself] haven’t made the case well enough about what the alternative vision can be. It should be a broadband content system that truly reflects U.S. diversity—and strives to promote the artistic, cultural, political, and even spiritual aspects of a “Just” society. I envision such a system everywhere—a diverse “digiplex” of dedicated and inter-networked public interest Web 2.0 sites in cities, state capitals and nationally [connected, of course, to many like-minded global services]. It would offer a range of programming and community-connecting efforts on cell phones, digital TV, and PC’s that would help challenge the status quo. If such services now existed in the Gulf Coast region, for example, there would be more powerful voices offering video and other programming that holds the country and political leaders accountable for failing to effectively rebuild. It would be run by—and better represent—those Gulf Coast residents who today do not own any major media outlet (namely, most people). I believe that such services could also generate revenues that would help pay for the programming and organizing which must be done.

One approach to some of this is to propose federal legislation–the Community Digital Diversity and Civic Engagement Act–that would provide a portion of the necessary funds and the equitable access policies. It would build upon the good work already being done by community cable, low power radio, citizen journalists, newspaper unions and many others. It’s time, frankly, that policy advocates looked beyond broadcast ownership: a new world has already dawned. A number of my proposals require a marketplace intervention that would explore business models for sustainability, so there’s a role for public interest minded funders here. We will be turning more to this topic in the New Year. Let’s have a serious debate, build and embrace allies, and work as hard as we can to make the necessary changes.

Online Ad and Data Collection Watch

My group has launched a new project to keep the public better informed about the latest threats to our privacy. Click here to visit Online AdWatch. It will regularly highlight new developments in the interactive ad marketplace across the PC, mobile, and digital TV platforms. Send me your favorite examples of technologies, applications and market strategies that should be included.

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