Google Lobbyist Attack on a Consumer Group and its Foundation Funding: A Chilling Effect. And a Public Apology is Required

Consumer Watchdog is a public interest group in the muckraking tradition of Ralph Nader and his Nader’s Raiders.  They work on a broad range of issues, including health care, clean energy, affordable insurance, etc.  Recently they launched a project focused on keeping Google more accountable, and have raised a number of concerns about the company’s privacy policy, lobbying efforts, etc.   The Watchdog had been working on the health privacy issues raised in what was called the Stimulus package; it made public claims that Google was lobbying the bill–suggesting they were trying to weaken privacy safeguards.  Google strongly denied it, responding that Consumer Watchdog’s accusation was “100 percent false and unfounded.”  This charge by Watchdog–and likely other Consumer Watchdog’s activities such as its focus on privacy risks raised by the Chrome browser– obviously triggered some kind of reflexive anger from Google executives.

According to Watchdog and press reports, Bob Boorstin, Google’s Director of Corporate and Policy Communications, wrote to one of Consumer Watchdog’s foundation funders that: “I am hoping that as you consider the activities of your grantees and whether to renew your commitments, you will take these kinds of activities into account and consider whether there might be better groups in which to place your trust and resources. I would like permission from you to address a letter to your Board of Trustees or Board of Directors in which we can highlight the activities of this grantee.”

Mr. Boorstin’s use of the phrase “better groups” sent a signal to the foundation world:  don’t fund public interest organizations that work aggressively to make one the world’s most powerful companies accountable.  Google’s work to pressure a foundation to cut off support for a privacy group creates a chilling effect.  At a time when Google is increasingly the focus of concern from privacy and consumer groups, and many policymakers around the world, Mr. Boorstin’s letter can be viewed as a self-serving attempt by the company to stifle debate.  If a group such as Consumer Watchdog intentionally libeled the company, than Google can pursue legal action.

But Boorstin’s letter to a funder appears designed to send a strong signal to the foundation world that they shouldn’t financially support groups that critically question the company.  With Congress taking up privacy legislation this year, Google has a great deal at stake.  This is precisely the time when consumers require as many watchdogs as possible, to ensure that Google and other online marketers protect their privacy.

We read in press reports that Mr. Boortsin has since issued an apology, saying that “…I made a mistake in sending information about the group’s activities to the Rose Foundation for which I apologize.  Google supports the right of anyone or any institution to fund whatever group or project they choose.”  But we don’t see any apology on its official policy blog, where it should be.

Yesterday, the National Journal, which covers Washington DC politics and lobbying, reported that “Google is launching a new effort to counter its critics with stepped-up outreach to analysts, journalists, policymakers and think tanks.” [sub required].

Google has an opportunity here to make a break with how things are done in Washington, politics, with privacy policies, and the online ad business.  Groups such as mine and Consumer Watchdog, in essence, are asking Google to be the prototypical ethical corporation.  Become transparent, disclose, embrace openness, develop policies that inform and empower citizens and consumers.  I firmly believe it can do all that and still make a great deal of money.

My group is also funded by the Rose Foundation, as are many other privacy groups. That’s the foundation Mr. Boorstin pressured (they resisted, of course–but the message was sent to the funder world as intended).  Google knows well that philanthropic sources of funding to support privacy work are slim.  Google gives money to certain privacy groups–which in our mind raise conflicts of interests for them.  What’s needed are a growing global array of independent consumer organizations focused on the nature of the emerging digital economy–and which means Google will likely be the subject of serious scrutiny and debate.  Google should be welcoming such civil society activity–instead of trying to smother it.

This incident suggests that Google leaders need to seriously examine how best to address their critics–and also work harder to resolve conflicts within its corporate culture about its long-term ethical goals.

PS:  On the specific issues of digital health marketing and privacy, there’s more work to be done here.  Google, Microsoft and many others see a gold mine in online health marketing.  Google is interested in the health market.  Here’s an excerpt for a job they had open last year to be based in New York:

Senior Account Executive, Healthcare Vertical

As a Google Healthcare Account Executive, you’ll work with those who provide advertising solutions for companies that produce and sell consumables and health care products/services. The primary responsibility of the GMS Account Executive is to drive and grow new business revenue with Fortune 1000 advertisers in the healthcare Account Executive industry. You’ll manage business relationships to ensure that your clients’ needs and requirements are met. This will require you to serve as their advocate within Google while collaborating with other Google teams to provide them with a comprehensive portfolio of solutions and options. This is a high-adrenaline, client-facing sales role requiring deep industry expertise, proven sales ability with a particular penchant for closing deals, and a broad base of industry contacts. You understand and anticipate how decisions are made, and you’ll persistently explore and uncover the business needs of your key clients.


* Work collaboratively with the GMS team to drive revenue growth with new and existing customers in the Pharmaceutical Account Executive industry.

* Develop high-level relationships to serve as a trusted consultant with major customers to optimize their advertising expenditures.

* Generate business plans to define your selling strategies and tactics.

* Understand and adapt to Google’s ongoing product and technology developments.

* Manage multiple cross-product opportunities and projects.

Microsoft to Advertisers: We can “track visitors throughout the course of their online journey”

So-called behavioral re-targeting is one of the most troubling online ad techniques.  No one knows they are being digitally shadowed in cyberspace.  But many companies provide such a profiling/tracking/targeting service.  Here’s what Microsoft tells advertisers in the UK/EU it can do [our emphasis]:

“With Re-messaging we can narrow our audience by finding the people who have already visited you. It means we can ensure they always stay in touch and help create continual engagement with your brand.

Re-messaging is effective on its own, but works at its best when combined with other forms of targeting and campaign performance. By placing action tags on your website, we can track visitors throughout the course of their online journey and re-message them on our network. For example the consumer may have previously searched for a hotel but not booked, compared credit cards but not applied, or visited a promotional website. Whatever it may be, if they’ve gone part way to making a purchase or performing an action, we can help you continue the conversation and ensure that the relevant message is seen by the people it matters most to.”

UK Ad Leader: “Future of Advertising” will be the “Mapping” of our Brains

excerpt from The Guardian:  “Robin Wight…is president of the Engine Group, which encompasses 13 media businesses…the future for advertising isn’t just about building organisations; for Wight it is also about brain science. He is zealous, fanatical even, about the potential of mapping brains in greater detail and discovering what makes us tick. It is the “future of advertising – of everything”, he says…The theory of memes, Wight believes, is the most interesting idea of the past 50 years; and it helps to explain how ads that make an impact …

“It’s still controversial but in the future we’ll find little synaptic connections that represent the Guardian, BMW, all these brands. You put an electrode on someone’s head and say Jennifer Aniston, for example, and one neuron fires,” Wight says. “It took 50 years after genes were conceived of to find them in the body and it may take another 50 before we find memes – but we will find little clusters, bundles of connections that represent brands.”

If we could scientifically measure which adverts worked, he says, then there wouldn’t be any need for an “avalanche of annoying ads”… Scanning brains is no different from focus grouping, he believes – just more effective. “…

“Just imagine if you could pre-test an ad and you knew it would make people happy and it would be effective…You’d only be exposed to ads that engage with you – the products that fail won’t be offered. You’re not manipulating people, you’re just measuring which particular thing has an impact.”

‘It’s the future of advertising, of everything’.  Jo Adetunji.  Guardian.  February 23, 2009

Online Advertisers & interactive data Collection: Exec Says`online publishers have sold their souls to science’

From this weekend’s IAB annual meeting, excerpt via ClickZ.  my bold:

“While for years the business seemed to err on the side of art, now I think it errs on the side of science and math,” said Millard [Wenda Harris Millard, co-CEO at Martha Stewart Living Omnimedia… She cited the recent appointments of tech industry luminaries to lead two of the largest online media companies — Qi Liu at Microsoft and Carol Bartz at Yahoo — as evidence online publishers have sold their souls to science.

Rothenberg [Randy Rothenberg, IAB CEO] told ClickZ…the IAB intends to field research on “digitally driven brands.” The purpose will be to offer actionable insights publishers and other sellers can use to drive more powerful message creation.

source:   Millard Issues Plea for More Art, Less Science in Online Ads.  Zachary Rodgers. ClickZ. Feb 23, 2009

UK Mobile Marketing Deal will “revolutionise the way advertisers traditionally target audiences” [Annals of Mobile Marketing/UK/EU Division]

excerpt from press release:  “London: February 12th, 2009 – Gigafone, the leading mobile marketing solutions group, has announced that it has formed a partnership with Xtract…The new partnership promises to revolutionise the way advertisers traditionally target audiences. Xtract’s Social Links application identifies the social network structures within the customer base and finds the most influential people for marketers to target.  When incorporated into Gigafone’s targeted mobile marketing solution, where consumers can choose the type of ads they want to receive in return for incentives such as discount vouchers or free mobile minutes, the result is a completely new level of customer experience and a tangible tool for increasing the effectiveness of targeted marketing activities and measuring return on investment…

About Xtract
Xtract refines social interaction, behaviour and demographic data to create accurate 3D user profiles. These profiles for the first time utilise data as a dynamic tool in the day-to-day marketing for effective and intelligent targeting of marketing campaigns and advertising. Xtract’s Social Links is an automated, self-learning solution capable of analysing billions of mobile transactions with easy to use and actionable tools for operators to define accurate target groups for their marketing campaigns.”

MySpace Exec on its ad hypertargeting system: We have “massive amounts of data” on our users (and an example using Pepsi)

Excerpt.  on MySpace CEO Chris DeWolfe presentation.  via  “MySpace has 76 million unique online users in the US, and 139 million users worldwide; 40 percent of all Americans based in the US are on mySpace…MySpace has been working on its monetization technology currently used online called Hypertarget, which is five algorithms that basically segments the “massive amounts of data” on mySpace users into “enthusiast buckets.” Currently, they have their audience divided into over 1,000 of these segments, and for example, if Pepsi wants to target alternative music users they can serve them up an ad. Said DeWolfe, “It’s incredibly effective, and increases our yields.” This will be moving onto mobile.”

Center for Democracy & Technology Goes for the “Gold” as it Raises $ for its “Gala” from AT&T, eBay, Microsoft, Google (and many other corporations)

CDT is having a “Gala Celebration” next month, supported by “Gold, Silver, and Bronze” sponsors.  AT&T, eBay, Microsoft and Google are listed at the $15,000 “Gold” level [“Two tables in Premium Location-Two tickets to the VIP Reception”]; Among the “Silver” sponsors [“One table-One ticket to the VIP Reception”] at the $7,500 tab include Time Warner (AOL), Dow Lohnes, Qorvis Communications (repping Sun, Cisco, etc), American Express, Verizon, Intel, US Chamber of Commerce, ID Analytics, Yahoo!, Arnold & Porter, IAC/Interactive Corp, Thompson LexisNexis, Hogan & Hartson (reps News Corp’s MySpace, among others), Comcast, and Sonnenschein Nath  & Rosenthal, LLP.   There are also a number of “Bronze” sponsor at the $1000 level [“One seat at a table”]. (CDT has a Facebook page on the event.)

CDT’s 2007 Gala, which honored Bill Gates, had “more than 900″ supporters” in attendance.

Porsche Teams with Yahoo for Mobile Behavioral Ad Targeting [Annals of Mobile Marketing]

Excerpt from Ad Age:

“…in just a 4-month-long pilot run, mobile outperformed Porsche’s wider campaign…The carmaker used Yahoo behavioral targeting tools to serve Porsche ads to smartphone users whose web-surfing behaviors had indicated they were in the market for coupes, SUVs, convertibles or luxury cars.”

source:  Mobile Effort Gets More to Say `I Can’ Purchase a Porsche.  Rita Chang.  Ad Age.  February 9, 2009 [sub. required]

more on Yahoo and behavioral targeting

Facebook, Advertising, Third-Party $Apps, Terms of Service, Data Collection & Privacy

The role that third party developers play accessing user data on social networks such as Facebook has long been a privacy concern for us.  The business practices, including data collection, profiling and targeting that form the basis of social networking “monetization” strategies are hidden from public view.  My CDD and USPIRG, in our various privacy complaints to the FTC, asked the agency to examine this area.  Maybe the new Obama FTC will do so.  But for now, here’s some excerpts from Facebook’s advice “on common business models” to application developers, as well as from its list of “third party developers” involved in social media marketing:

“As you think about building your app on Facebook, we want to help by highlighting some keys ways of thinking about your app as a business… Apps that are meaningful, trustworthy and well designed have real staying – and monetizing – power… we host a Platform with instant access to more than 175 million active users… Once you’ve created a sustainable, engaging social application, there are many different ways to help monetize it… Advertising: We at Facebook have had success serving targeted advertisements to our users based on information we know about them. By leveraging the data we give you access to (as detailed in our Developer Terms of Service) and data users share with you directly as a part of your application experience, you can serve highly relevant ads… Virtual Credits / Virtual Goods:… instead of accepting payments directly from users for subscriptions or virtual goods, some applications instead allow users to complete affiliate offers by filling out surveys or agreeing to try new products. There are a number of providers who consolidate these types of offers…
Third Party Providers to Help You Monetize:

AdParlor:  “Over 500 Million users worldwide are on a social networking site. These users are comfortable sharing their age, gender, and location, and can be reached through targeted advertising.”…
Shopitmedia: “you can target based on:
1. Location
2. Gender
3. Age
4. Application Category”…
Affiliate marketing…


Why CDD Was Prepared to Go to FTC with EPIC on Facebook’s Terms of Service Digital `Bait & Switch’

Yesterday, my group worked closely with the Electronic Privacy Information Center to prepare a complaint on Facebook’s new Terms of Service agreement.  We have been tracking Facebook’s new “engagement” ad targeting efforts, including its “polling” product.  As Adweek recently reported, “The polling ad is part of Facebook’s second effort to integrate advertisers into the fabric of the site beyond standard banner units.”  As explained by eMarketer, “Facebook’s Engagement Ad polling feature may be a precursor to a more full-blown market research program—one that Facebook isn’t quite ready to talk about yet,” said eMarketer senior analyst Debra Aho Williamson. “Social network profiles are a treasure trove of information about consumer preferences, and people talk about brands and products frequently.”

Facebook also recently “announced the release of several new Facebook Platform APIs, all of which enable application developers to access and share more real-time information about their users and their friends.” As InsideFacebook reported, the “release of several new Facebook Platform APIs, all of which enable application developers to access and share more real-time information about their users and their friends…While Facebook apps have been able to set Facebook users’ status updates for a long time, this is the first time developers will be able to access current and recent updates for app users and their friends.”

This latest Facebook flap underscores our call for policy safeguards.