Category: Behavioral Targeting

EC Enisa Report Underscores Privacy Threats and other Risks from Social Networks: Wake-Up Time for Facebook, MySpace, IAB, FTC, Congress. Rules & Safeguards Required

The expanded targeting based on user profile activity launched last month by both Facebook and MySpace underscore why we must craft federal (and EU) rules to govern the data collection apparatus of social networks. By combining behavioral targeting, transaction data, and profile information, Facebook and others have entered into a new territory. Even industry insiders understand how a line has been crossed: one senior VP at Digitas (part of the Publicis Groupe ad industry empire) noted that [our emphasis]:

“Facebook has made an announcement that has major implications for how marketers can communicate to members going forward. Essentially, Facebook said that it will allow marketers to target members with ads based on its user’s personal profiles, social connections and even the recent activities of each user’s extended network.

This announcement marks a significant departure in the way social networks have been organized to date. Until now, marketers have had limited opportunity to serve ads directly to users within the social network. With this change, marketers will now have the opportunity to target consumers directly based on attitudinal, behavioral and demographic attributes included directly in or inferred from personal profiles and connections online.”

We have sent out to the FTC today this new report [pdf] by ENISA—the European Network and Information Security Agency. Released in October, “Security Issues and Recommendations for Online Social Networks” is worth reading—for its clear and thoughtful analysis and, frankly, its disturbing implications. It’s clear from the start of the paper that social networking sites (SNS) are more than just commercial or personal playgrounds—they are, notes ENISA—“…all-embracing identity management tools…” As the report explains:

“Users are often not aware of the size or nature of the audience accessing their profile data and the sense of intimacy created by being among digital `friends’ often leads to disclosures which are not appropriate to a public forum. Such commercial and social pressures have led to a number of privacy and security risks for SN members.”

Among the “threats” the report lists includes:

1.1 Digital dossier aggregation: profiles on
online SNSs can be downloaded and stored
by third parties, creating a digital dossier of
personal data.
1.2 Secondary data collection: as well as data
knowingly disclosed in a profile, SN
members disclose personal information
using the network itself: e.g. length of
connections, other users’ profiles visited
and messages sent. SNSs provide a central
repository accessible to a single provider.
The high value of SNSs suggests that such
data is being used to considerable financial
gain.
1.3 Face recognition: user-provided digital
images are a very popular part of profiles
on SNSs. The photograph is, in effect, a
binary identifier for the user, enabling
linking across profiles, e.g. a fully identified
Bebo profile and a pseudo-anonymous
dating profile.
1.6 Difficulty of complete account deletion:
users wishing to delete accounts from SNSs
find that it is almost impossible to remove
secondary information linked to their
profile such as public comments on other
profiles.

Among the report’s other recommendations include the need to consider reviewing regulatory safeguards and data protection law, such as the FTC’s Fair Information Practices. Social networks have become a place where people are living out their lives, sharing intimate details about their identity. They cannot be operated as data mining and digital marketing operations solely. They must operate in the public interest as well, including rules protecting privacy for those under 18.

It’s time for a broad range of stakeholders to work together to address what must be done.

PS: ENISA held a conference on the issue last June, featuring a number of interesting papers.

Mr. Murdoch’s Gets Religion: Will Give the Faithful some of that `Old Time’ Behavioral Targeting

A brief the `spirit-meets-the-digital-age’ note just in time for the holidays. Paidcontent.org reports that Rupert Murdoch’s News Corp. will acquire Beliefnet, a “multi-faith community site.” Beliefnet describes itself as the “largest spiritual website.” Its mission is “to help people like you find, and walk, a spiritual path that will bring comfort, hope, clarity, strength, and happiness. Whether you’re exploring your own faith or other spiritual traditions, we provide you inspiring devotional tools, access to the best spiritual teachers and clergy in the world, thought-provoking commentary, and a supportive community.”

As Paidcontent notes, the acquisition makes sense, given Murdoch’s corporate “faith-based efforts including Fox Faith, the 20th Century Fox line of movies aimed at the religious set and operating under Fox Home Entertainment, publishing houses HarperOne and Zondervan.”

But under the deal, those faith and spiritual seekers will be the focus of behavioral targeting and micro-marketing, courtesy of Fox Interactive Media (the Murdoch unit that operates MySpace, among other News Corp. digital properties). Beliefnet will “be using FIM’s targeted ad delivery platform.”

Now we will have to considering that in addition to the FTC, we will need to ask the Vatican, the National Council of Churches, and the Union for Reform Judaism to also launch investigations into behavioral targeting! That ‘old time’ religion meets the digital era.

The news media and behavioral targeting connection

It’s long been a concern that so many news organizations–or their parent entities–have embraced behavioral targeting (and so many other types of online marketing techniques) without clear disclosure to users, readers and viewers. There should be stories explaining what’s going on, exposing the techniques used that threaten privacy, analysis on the implications to journalism, editorials supporting reform, etc. We have covered some of these issues in our book and on this blog. But as a reminder, we run an excerpt from a Tacoda want ad for online sales manager: “TACODA®, Inc. (www.tacoda.com) is the world’s largest and most advanced behavioral targeting advertising network… Major US media partners include Dow Jones, The New York Times Company, NBC Universal, … [and] USAToday.com.”

All the news that fit to click, indeed.

The Future of Behavioral Targeting Regulation–First in a [very long] series

Now that the EU’s Article 29 Working Group has announced plans to investigate behavioral targeting as part of its 2008 workplan, advocates and regulators from both sides of the Atlantic can build the case for meaningful safeguards. The goal should be maximum privacy protection. It’s interesting to see the response coming from European-based behavioral targeting firms, such as nugg.ad.ag. In an article for the UK-based imediaconnection trade report, nugg.ad’s co-founder removes the use of IP addresses from the targeters arsenal, writing that “… even IP addresses has no place in targeting.” That will come to a surprise to many in the online marketing industry!

Nugg.ad is engaged in a range of targeting efforts that require the scrutiny of data regulators. But just in case you thought their rejection of IP address targeting made them a worthy of a privacy prize, you would be mistaken. In the same article, the nugg.ad executive describes the new generation of data that can be mined by marketers [our emphasis]: “Web 2.0 offers a better option — user-generated content, be it through word, sound or image, which is fitted with ‘tags’. These community recommendations lift contact management to a new level. By using targeting technology that can be applied flexibly, you can develop completely novel approaches and exploit untapped potential.”

The Article 29 group will surely be working.

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Facebook’s Expanded Ad Targeting: Follow the Algorithm

From Search Insider: “The most striking word that came up repeatedly when I heard someone from Facebook present was “algorithm.” It’s the algorithm that determines how many stories appear in the News Feed, which users members share connections with, and which types of actions are involved. It knows which friends you’re most closely connected to, not just based on how you interact with them, but by factoring in when you and your friends independently interact with the same content. This algorithm might know who your friends are better than you do.”

The evolution of targeting users online (or, "Oh where oh where has our privacy gone")

An excerpt from a recent trade piece that should encourage reflection and concern (our emphasis):

“Today, we can not only target by the sites we think our customers frequent, we can follow them around the Web and target them based upon the other sites they actually visit. We can also target them based upon the words typed into a box, and from where those words are typed through search geo-targeting. We can also retarget searchers elsewhere on the Web. Facebook’s recent announcements take targeting to a whole new level, based upon age, location, interests, and other online activity.”

Source: “Search And Online Advertising: A Continual Evolution.” Ellen Siminoff. Search Insider. November 16, 2007

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NebuAd’s “360-degree, multidimensional view” of users

It’s time the FTC and the online ad industry redefined Personally Identifiable Information (PII) to reflect the realities of the interactive marketing era: it must include the bits of data about us which describe and analyze our behaviors, now classified as non-PII. Such so-called non-PII tracking is really linked to individuals. The role that Internet Service Providers (ISPs) play in providing behavioral targeting and other interactive marketing firms with our data requires an investigation. Take NebuAd, a company that explains: “[T]o date, the role of service providers (ISPs) has been limited to enabling, but not participating in, the online advertising revenue ecosystem. NebuAd creates a greater market opportunity for the entire online advertising ecosystem, opening new revenue possibilities for ISPs that preserve and enhance the interests of the advertisers, publishers and consumers on their networks.” NebuAd also says that it is the “leading the industry to a new level of advertising effectiveness. NebuAd combines web-wide consumer activity data with reach into any site on the Internet. The result is vastly more data and relevance than existing solutions that are limited to one network or site. NebuAd is dedicated to the highest standards of consumer privacy.” In fact, the company touts its membership in Truste and claims that it is “committed to the highest standards of consumer privacy. NebuAd’s network was architected from the ground up to meet industry best-practices regarding consumer information privacy protection.”

But in this week’s “Behavioral Insider,” NebuAd’s CEO says the following (our emphasis): “We don’t track individual consumers… by anonymous we mean we collect no personally identifiable email addresses, last names, home addresses, social security or phone numbers, financial or health information. The kind of data we do aggregate includes Web search terms, page views, page and ad clicks, time spent on specific sites, zip code, browser info and connection speed...within this vast universe of information we create a map of interest categories, beginning with the widest definitions, auto, finance, education, what have you. But within those we can provide far greater granularity. So if you’re talking about auto, we can drill down into particular interest segments, say SUVs, luxury cars, minivans, and then even to particular brands or models. Within the interest category of travel, we can identify consumers interested in learning about Martinique, the south of France or Las Vegas.”

How do they do that? Why, they get ISPs to turn over our data. Here the Nebu Ad CEO again (with our emphasis): “ISPs have been a neglected aspect of online’s evolution over the past several years. But the fact is the depth of aggregated data they have to offer, anonymous data, is an untapped source of incredible power… The conventional approach to behavioral targeting has been to place cookies on specific Web sites or pages. We’ve gone about it in a very different way. We place an appliance in the ISP itself. Therefore we’re able to get a 360-degree, multidimensional view over a long period of time of all the pages users visit. So what we’re really talking about for the first time is a truly user-focused, though still anonymous, targeting, taking the totality of anonymous behaviors rather than just a subset of sites on a network.”

Huh? That’s privacy protection? ISPs are going to have a lot of explaining to do about the “appliance” (built by the NSA?) watching us. I think the company better reconvene its new “Privacy Council.”

PS: Here’s an excerpt from the press release NebuAd issued at ad:tech two weeks ago: “NebuAd’s rich insight into consumer interests surpasses any other behavioral targeting solution and enables NebuAd to deliver precisely targeted ads that drive substantially increased value per impression…NebuAd’s deep insight into anonymous consumer commercial interests across the Internet, combined with its ability to micro-target the most relevant ad placements, brings a new level of value for advertisers, publishers and ISPs..”

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EC Second Phase Investigation of Google & DoubleClick: Good for Consumers, Competition and Privacy

Today’s announcement by the Directorate for Competition (DG Comp) underscores that the EC recognizes the serious consequences of the proposed Google takeover of DoubleClick. Competitors, consumer groups, and privacy advocates have provided sufficient information to the commission to warrant this relatively rare phase two inquiry. Google is quickly becoming the key digital gatekeeper for the online publishing and advertising marketplace. At stake here is more than just the skyrocketing Google share price, the convenience of our online searches, or even the current state of online advertising competition. The online marketing system is at the core of the dramatic changes transforming global communications–from broadband PC, to mobile, eventually even to television. If we are to have a more democratic and diverse digital marketplace of ideas and commerce, there must be meaningful competition and consumer protection in the online ad sector. This means Google should be prohibited from buying DoubleClick. Or, that at least meaningful safeguards are imposed that limit Google’s ability to leverage DoubleClick’s vast treasure trove of consumer data and its business relationships with many of the world’s largest companies.

Consumers need to be assured that they won’t be unfairly treated in terms of pricing and choice when buying online; advertisers will need protections to ensure that online marketing remains both affordable and competitive, especially when using Google. Privacy must be considered as well, with appropriate safeguards enacted

IAB creates new post: "SVP, Thought Leadership and Marketing."

As the IAB ramps up its political operation to defend the interactive marketing industry from consumer-friendly privacy safeguards, it has created a new senior position. The SVP for Thought Leadership and Marketing is… “to help drive the growth of interactive advertising through enhanced communications with marketers, agencies, and others about the power of interactive media to reach and influence consumers.” In another words, a seasoned PR hand. David Doty is now in that position; he came from Booz Allen Hamilton where he was Director of Corporate Branding and Creative Services.”

But what IAB requires is “thought leadership” that recognizes that interactive marketing can’t run a-muck. Consumer protections are required, as well as a socially responsible approach to digital advertising in a global environment.

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Facebook’s chief revenue officer’s pitch to advertisers: We’ve created “the most sophisticated and accurate targeting system available on the web today.”

What companies such as Facebook and MySpace say to their marketing clients and prospects is one thing. To users and members (and regulators), especially about protecting privacy, it’s another story. That’s one reason why we hope everyone will review this video from Facebook’s chief revenue officer Owen Van Natta presentation at a U.K. marketing conference held November 7, 2007. Van Natta explained that the new Facebook marketing system was designed to help marketers reach “people that influence people…the next generation of advertising is going to tap into trusted referrals in a way that has never has been done before.” Using the language of marketers, Van Natta pointed to the 25 million individuals daily on Facebook: “that’s a lot of reach and frequency.” “We’re going to spread your message virally,” he told the Internet Advertising Bureau UK crowd. You can “fan” your brand, he assured them. Facebook would enable them to tap into the “power of the influencer.”

Van Natta also discussed the test they had done of the new Beacon and related Facebook marketing system. Calling Facebook’s advertising approach a form of `social distribution,’ he said that “this is going to create some of the most effective advertising that marketers have ever seen…Facebook social ads are like trusted referrals from your friends.” It’s “the most sophisticated and accurate targeting system available on the web today.” The chief revenue officer also trumpeted the “targeting and insights” capabilities of the new approach: “nothing like this has ever been available before…incredibly power insights…actionable information.”

Van Natta also discussed the benefits for advertisers from the Beacon system, including how the use of the marketed products by Facebook members was tied in to their “mini-feed.” He discussed the new service called “Pulse,” which informs advertisers how many people are talking about their brand on Facebook. That’s “incredibly valuable,” Van Natta noted. He said they knew exactly who was getting the ad, and that advertisers would receive “actionable social data.”

We hope all Facebook users and regulators–here and in the EU especially–will watch this video. Facebook users have no idea they are now part of a viral marketing scheme, where information that is being sent to them is shaped by the kinds of arrangements made with advertisers. The idea that the information shared with marketers is “non-personally identifiable,” as he claims, is absurd. They know your interests, where you live, your circle of friends, etc. There is an important place for commerce in communications. But there need to be rules to ensure that what goes on is fair. And privacy must be protected.