U Penn Prof. Joseph Turow responds to the

Randall Rothenberg of the Interactive Advertising Bureau lobbying group wrote a commentary where he made a number of misleading statements. He incorrectly characterized the work of Professor Joseph Turow. Prof. Turow, a leading academic expert of the online marketing industry, is on the faculty of the Annenberg School for Communication, University of Pennsylvania. Here is Professor Turow’s response:

In one sentence, Mr Rothenberg manages to make two fundamental misrepresentations. What I really say on page 2 of my 2006 book Niche Envy (where the quote originates) explicitly relates to marketers use of surveillance technologies without consumers understanding: “Over the long haul, however, this intersection of large selling organizations and new surveillance technologies seems sure to encourage a particularly corrosive form of personal and social tension.” Nor do I anywhere lament the passage of the three network universe. For example, I explicitly state in Breaking Up (on page 199, for example) that three network era had its own forms of social exclusions and state that “that “the proper response to this hypersegmentation of America is not to urge a return to the mass-market world of the 1960s and 1970s.” My conclusion: when I see Mr Rothenberg quote someone I will be sure to check the source to make sure the passage has not been wrenched from its context. I should add, too, that I accept the need that digital interactive media have for target marketing and database marketing. But there are many creative ways to meld data analytics and their implementation with openness and public engagement. I fear that Mr Rothenberg”s policies and writings indicate he will lead this important organization in directions that are misguided for marketers and for society.

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FTC will need to do better job protecting our mobile privacy

The FTC, as nice as so many folks are over there, simply lags behind the online ad market. The agency’s forthcoming May 6-7 town hall entitled “Beyond Voice: Mapping the Mobile Marketplace” fails to include consumer and privacy advocates on the key “Mobile Advertising & Marketing — The Transition and Adaptation to Mobile Devices and the Small Screen” panel. There is overall a lack of real mobile industry watchdogs at this FTC event. Perhaps the FTC should start off reviewing the plans of mobile marketers to track and target consumers. Here’s what Yahoo! Mobile says it can help marketers do:

“Yahoo! offers a rich, comprehensive set of mobile ad products – all designed to empower advertisers to tap into the rapidly–growing, lucrative audience of mobile consumers. Yahoo!’s Mobile Ad Services make it possible to reach your target customers wherever they are, seamlessly following them from the PC to the mobile Internet. A wide variety of ad formats, targeting options, and calls-to-action are available – as well as resources to help you put effective programs in place if you’re new to mobile advertising…Eye-catching display ads can be targeted using the same wide array of options as traditional Web banners (e.g. context, demographics, behavioral) – and can incorporate location, which has greater importance when marketing to consumers who are ‘on the go’…Select the call–to–action that works best for your business: click through to a promotional site, enable the consumer to find or call a store directly, offer a coupon, send an SMS message – the options keep expanding…

Mobile search that practically reads your mind.”

PS: How come so many of the speakers from the non-profit world on the agenda are supported by online marketers, including mobile oriented ones? See, for example, CDT, Internet Education Foundation, TRUSTe.

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The Online Ad industry Must Respect & Protect Adolescent Privacy

Last week, a coalition of child advocacy, health and media groups asked the FTC to develop safeguards for digital marketing that would protect adolescent privacy online. This will be a major focus of the Center for Digital Democracy over the next year or so, building on our work during the 1990’s which led to the passage of the Children’s Online Privacy Protection Act (COPPA). COPPA helps protect the privacy of children under 13 years of age. Adolescents are now a principal focus of the online data collection and targeting system, a process which raises many ethical and health-related issues. We call on responsible online ad industry leaders to work with us to enact meaningful policies that protect adolescent privacy on websites, social networks, online gaming, etc. We are pleased that some major online ad companies have privately said to us that they recognize there is a problem. We will work with them and other responsible digital marketers. Policymakers from both congress and the FTC also recognize adolescent privacy is an important concern. It is a bi-partisan one as well (Senator John McCain was the co-sponsor of COPPA). The time to develop a meaningful framework that respects the autonomy of adolescents, but protects their privacy, is now

Former journalist and now online ad industry lobbyist Randall Rothenberg, in a BusinessWeek commentary, suggests that the call for privacy rules ensuring individuals have control over their data will undermine the Internet. You would think a Madison Ave. trade group could craft more creative PR copy. But the online ad industry’s position is indefensible, since they built a system based on the harvesting of our information without believing they would need to get our permission first. The IAB board should realize it has embarked on a very dangerous campaign here that will undermine credibility for many marketers. Here’s my response submitted to BusinessWeek:
Mr. Rothenberg, as head of the interactive ad trade group lobbying against the call from consumer groups for the government to protect personal privacy online, fails to address the central question regarding online advertising. The call for regulation is designed to ensure individuals control their data while on the Internet or using their mobile phones—not companies such as Google, Microsoft, and AOL. Public interest groups are not opposed to interactive marketing: indeed, we recognize it as a key source of funds for online publishing. But Mr. Rothenberg’s members have created a commercial surveillance system that rivals the NSA—tracking and analyzing our every move while on the Internet, all so we can be encouraged to behave favorably to some marketing message. Responsible ad industry leaders will seriously address the privacy threats created by the interactive marketing apparatus—and not hide behind self-serving claims that unless our privacy is lost, we won’t have a robust digital medium.

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Google, Comcast, Verizon, AT&T and Time Warner in coalition to fight state-based public interest and consumer protection issues

Scratch a media conglomerate–old or new–and you reveal a political agenda that is all about the aggrandizement of power–consumer and data privacy be damned. Here’s are excerpts from a Kate Kaye story on the roll-out of the state-based coalition designed to protect the interests of the online advertising industry.

From California to Utah to New York, state legislators regularly propose laws with major implications for the online ad industry. A once-loose collective of companies including Google, Yahoo, AOL and eBay finally incorporated officially this year after four years of collaborating to influence state policy.

The most recent target of the State Privacy and Security Coalition’s efforts is New York Assemblyman Richard Brodsky, sponsor of a bill preventing third parties from using sensitive personally identifiable information for behavioral ad targeting.

The coalition doesn’t like it. A missive sent to the legislator April 7 by the coalition’s lead counsel calls the bill “unnecessary,” and “most likely unconstitutional.”…Jim Halpert, partner in the communications, e-commerce and privacy practice at law firm DLA Piper, penned that letter. As head counsel for the coalition, he also recently facilitated its incorporation.

“There’s much more state activity than federal activity,” said Halpert. Not only does that create more laws or proposed laws to deal with; the state process moves much faster.

According to Halpert, the coalition also includes Verizon, AT&T, Comcast, and organizations such as the Internet Alliance and tech trade association AeA, formerly the American Electronics Association. With Halpert at the helm, coalition members conduct weekly phone calls, and sometimes meet in-person with other members or with state lawmakers to influence legislation involving online privacy and data security, Internet advertising, online child safety, content liability, spam, spyware, and taxation…

“We see the coalition’s role as helping state legislatures understand the technology policy area. I think we all recognize the technology environment can be complicated,” said Adam Kovacevich, Google’s senior manager, global communications and public affairs. Google Director of State Public Policy John Burchett is the firm’s primary liaison to the coalition.”

source: Google, AOL and others make state policy coalition official. Kate Kaye. clickz.com. April 14, 2008

ValueClick touts its "Preditive…Behavioral Targeting" Clout

excerpt: VALUECLICK MEDIA SAID… it has built an applications platform to offer advertisers behavioral targeting based on predictive analytics… By focusing on targeting visitors rather than pages, ValueClick says it can serve more relevant ads that appeal to each Web site visitor based on past behavior to provide higher click-through and conversion rates.

ValueClick’s platform relies on three algorithms: behavioral targeting, recommendations and ad server real-time selections, according to Joshua Koran, VP of targeting and optimization at ValueClick, which supports media inventory on more than 13,000 sites. “Cookies stored on visitors’ computers collect data and build search profiles containing one or more facts,” he said.

The cookies collect data on Web site visits, ad interactions, searching, product comparisons, product purchases, and third-party data fed into algorithms that predict behavioral trends, storing the information in ValueClick servers. Koran says the predictive analytics platform will cluster the data collected from searches and clicks in thousands of categories, such as mobile, travel and finance.

The predictive algorithms in the behavioral targeting application will store the profile as long as the cookie comes back to the server with more data. It will process hundreds of millions of profiles tied to …cookies on billions of events daily. The algorithm built into the application will determine when the information is no longer useful.”

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CDD and USPIRG File Comments on

Although not yet on the FTC website, CDD/USPIRG filed comments in the proceeding. They are available here. Our submission makes clear the commission must immediately enact policies to protect consumers and the public, especially to protect their health/medical, financial and family information. It provides, I hope, a very good overview and rich detail on the latest digital marketing developments that threaten privacy and consumer autonomy.

With european privacy regulators also now looking into behavioral targeting and interactive marketing, there is growing awareness on both sides of the Atlantic about these powerful privacy threats. Hold on IAB, wherever you are, it’s going to be a bumpy ride!

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The EC approval of Google’s DoubleClick takeover

Statement on the EC Decision on Google/DoubleClick
Jeff Chester, Center for Digital Democracy

By failing to impose safeguards, EC regulators have helped strengthen a growing digital colossus that will now be in a dominant position to shape much of the global future of the Internet and other online media. The EC [DG Comp] appears to have embraced the FTC’s flawed analysis of the online ad market. It represents the failure of antitrust regulators to understand and respond to the growing consolidation of control over online ad delivery, data collection, and the funding of content. This decision will have profound and unfortunate consequences for the Internet’s evolving role as a democratic communications medium.

EU and US antitrust regulators have also perversely set the stage for Microsoft’s goal of acquiring Yahoo!, furthering more concentration of control in the new media sector. Instead of ensuring competition, DG Comp and the FTC have literally paved the way for the emergence of a global digital duopoly over online advertising (which is the principal way online content is funded). By permitting Google to dramatically grow in clout, regulators will have to likely enable the further growth of a # 2 competitor to Google—which will be Microsoft.

US and European policymakers must reform the antitrust process to reflect the realities of the digital market era, where competition, data collection, and content creation are seamlessly intertwined. In today’s digital marketplace, the company that controls the most data about consumers and has the global reach to connect to them raises both anticompetitive and privacy concerns. An antiquated and piecemeal antitrust approach fails to protect citizens, consumers, and competition.

The Center for Digital Democracy, which opposed the Google/DoubleClick merger in both the U.S. and in the EC, will continue to press policymakers to play a more responsible forward-thinking approach to competition and consumer protection for online and interactive media.

The emerging online health field requires meaningful privacy and interactive marketing safeguards to prevent the exploitation of American consumers. Google, Microsoft and many others see digital gold from the online targeting of medical-related products & services. There will be a flood of personalized pitches from the Big Pharma brands, health remedies, and over-the counter remedies. Yesterday, CDT sent out an email saying that “[N]ext week the Center for Democracy & Technology will announce a major health privacy initiative that will emerge as the major player in this converging field, poised to stand in the gap, bringing providers, industry and consumers to the table to build workable solutions and impact policy makers.” The CDT missive explained that “[A]ddressing these issues requires a strong, credible voice, that combines privacy and technology expertise with a deep understanding of the health care system and the goals for information technology; a voice with privacy policy experience and an understanding of how technology can be used to improve health care.”

The health of the American public in the digital era will be directly connected to the policies we enact governing medical micro-targeting, data collection, and online marketing. Groups have to stand up for what is right for consumers. The new CDT effort–along with the online health data and marketing initiatives–will require close scrutiny. Protecting health-related privacy and ensuring safeguards for digital medical advertising are essential if we are going to engage in prevention.

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Microsoft is set to acquire behavioral microtargeting and “marketing automation” specialist YaData. YaData’s software helps identify “behavioral micro-segments” [thats our behaviors, btw]. As YaData explains, “[M]icro-segments may overlap, reflecting the true multi-dimensional nature of customers and their changing habits. The continuous dynamic discovery and management of focused micro-segments allows marketers to understand and act upon changing market trends and gain rapid results for a real competitive differentiator. In order to act upon these changes, it is vital that marketers be able to routinely and autonomously launch the discovery process and manage the entire segment lifecycle…” [the managing, we presume, is of people’s behaviors and attitudes].

“YaData fully believes in the potential of behavioral targeting to enhance the value of online advertising for publishers, advertisers and users,” said Amir Peleg” in the press release announcing the sale. Microsoft officials claimed that as YaData’s technology became part of the company’s “advertising platform” they would “continue to adhere to its high standards for the protection of consumer privacy.” As Microsoft moves closer to acquiring Yahoo!, privacy advocates will need to analyze how the company’s recent acquisitions and developments related to online advertising require real safeguards–not just a reflexive we-care-about-privacy approach.

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