Month: March 2007

Will the Interactive Advertising Bureau `Mess-up’ Branding Online By Opposing Privacy Safeguards?

The IAB appears to have engaged in a Congressional game of deception today, warning Congress that legislation designed to protect privacy and digital marketing abuses would “curtail consumer choice and hinder the growth of advertising that is proving one of the Internet’s economic underpinnings.” The IAB lobbying group used the same, tired, old refrain as it sought to protect its special interests from having to act responsibly. If Congress protected consumers with online marketing safeguards, warned IAB, it would threaten the nature of the Internet itself. Dave Morgan, representing the IAB (and with the behavioral targeting company Tacoda) told a House subcommittee that “there is always a risk that legislation that governs complicated technology could result in limiting and/or stifling innovation. We want to ensure that the availability of free content online continues to grow and that consumers receive the richest, most relevant internet experience, without unduly burdening the advertising engine that makes these websites run.” The IAB’s new president Randall Rothenberg said that interactive advertising was the “primary means of support for cost-free, rich Internet content, as well as free access to unparalleled products and services. Such advertising has lowered barriers to market entry, enabling new businesses, both small and large, to thrive.”

The ad industry always plays the content card when it engages in self-protection. But the IAB’s leaders are doing a disservice to their industry. No one is saying that there can’t be interactive advertising. What is being said is that there have to be safeguards to ensure it’s done responsibly. There is going to be a growing movement to rein-in the abuses emerging. If the IAB was truly interested in the public, it would get in front of the issue. Instead, they are hiding behind the content the American public actually pays for (through higher prices to cover marketing, and now with unprecedented violations of personal privacy, data collection and more).

Unless the IAB, its members, and the ad industry as a whole begins to honestly address what is being put in place and support meaningful safeguards, marketing in the digital era will increasingly be distrusted. Where are the ad industry leaders who place the interests of the public before more narrow concerns about market share, brand engagement, and `closing’ the `conversion’ loop?

When I look up Orwell’s “doublespeak” on the Google search engine, I hope I receive Google.com near the top. Their new so-called privacy policy is a sham. They should be truly ashamed of themselves for engaging in such intellectual dishonesty. Google will now make its personalized data search information about us anonymous–but only after 18-24 months! Read Google’s annoucement here.

What this means is that Google will have access to all the current and relevant personal info about each of us, so they can target us while searching, on YouTube, Gmail, Google mobile, etc. The company knows very well that such search information is less relevant for precision targeting after 18 months. Besides, their data `cup’ on us will always be runneth over–or, more precisely, flowing into their servers and data mining centers. Google should have announced a policy where no collection and retention occurs for U.S. users–without explict and informed prior consent. As noted elsewhere, Google is using as an excuse the need to comply with EU-related policies on data retention.

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Is Google Doing a Turn-about on Network Neutrality Law?

As reported by Drew Clark and others, high-ranking Google senior policy counsel Andrew McLaughlin told a Silion Valley crowd that “Net neutrality will ultimately be solved by competition in the long-run…Cutting the FCC out the picture would probably be a smart move. It is much better to think of this as an FTC or unfair competition type of problem.” It doesn’t appear at the moment that his view is official Google policy. But it underscores why we have never been confident that the corporate supporters of network neutrality, especially Microsoft, Yahoo!, IAC, and Google, could ultimately be counted upon to place the public interest before their own corporate futures. The Google’s and Yahoo!’s of the new media world are fearful of fostering public policies that would ultimately rein-in their efforts to collect huge amounts of personal data about each of us—so they can deliver ubiquitous interactive advertising and branded entertainment. As we’ve noted in the past, word from friendly policymakers is that Google and the coalition have done a terrible job lobbying for network neutrality rules. These developments underscore why those concerned about the future of the public interest and the digital era must quickly move beyond the policy realm. The real decisions about the quality and diversity of our digital media system in the short term will be primarily determined–sadly–in the marketplace.

We note that our friends at savetheinternet have written that Google still firmly supports network neutrality legislation, including the Dorgan/Snowe/Markey proposals. They have a quote from a Google spokesperson saying so. But we believe still that all the key work to promote net neutrality will have to be done by the folks outside the “gang of six.”

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Viacom & Media Giants Fear & Loath

Two related points about Viacom’s lawsuit against Google/YouTube [available as PDF]. First, we understand that Viacom and many other media giants are fearful about the growing power of Google. They have been exploring ways to challenge and undermine Google, including via a range of legal means. Viacom’s Sumner Redstone is experienced taking on other media giants. He sued cable baron John Malone’s TCI in another well-known lawsuit back in 1993 [read it via this link]. That suit served its purpose, and helped create greater media consolidation and a Viacom-cable industry alliance. The stakes are higher here now, since the entire industry is undergoing a serious transformation. We are talking about what the relationships will be between the major PC, mobile, and interactive TV platforms, content providers, and advertising powerhouses such as Google.

The second issue is that this is primarily about interactive advertising and the emerging rules of the digital distribution game. Who gets the lion’s share of ad revenues, access to user personal data, gets to do targeting via video broadband, and really controls the monetization of the eyeballs and psyches [with sales of content, etc.] is what’s being fought here. This is all about splitting the pie—obscuring the key public interest issues about the openness of all platforms; ensuring the availability of diverse public interest content; the need to protect our privacy; safeguards against further over-commercialization via the explosion of broadband video marketing.

Reporters and others covering the story should try not solely view it as a digital food fight between two giants. This is more about the structure of the online world moving forward. The role of the public and the independent media producer should be discussed as well.

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Shame on Morgan Stanley: The New York Times Is More Important Than Your Nickel and Dime, Journalism Be Damned, Attitude

We wanted to weigh-in for some time on the pressure Wall Street and other investors have been placing on publicly traded newspaper companies. They have done a great deal of damage to the vitality of the U.S. news media, including forcing the sale of Knight Ridder. Now, Morgan Stanley and others are pressing the Times Co. to change its shareholder voting policy [which helps the family maintain control] and to also make other moves designed to maximize revenues. Today’s Wall Street Journal has a good story on a recent meeting Morgan Stanley’s Hassan Elmasry had with the Times’ board [sub. may be required]. The Journal story said that Morgan Stanley may withhold their votes for the election of Times Co. directors as a statement of displeasure. T. Rowe Price is also one of the investment companies unhappy with the Times. But the key point is that Morgan Stanley is pressing the Times Co. to maximize revenues and shareholder return. According to the Journal: “Mr. Elmasry’s presentation to the board repeated many of the concerns he has already raised with the company’s management. According to a person who saw his presentation, he showed a number of slides comparing the shareholder return of the Times company to other media concerns, such as Dow Jones & Co., the publisher of this newspaper, Washington Post Co., Gannett Co. and Tribune Co., and showed that the Times’s returns were the worst of the group.” If Morgan Stanley’s leaders can’t see why the Times is such a valuable public interest benefit, that says a great deal about who they are. No one is saying there shouldn’t be criticism if people believe there are legitimate problems with finances, such as fraud and abuse. But newspapers are critically important to our nation’s culture. We have so few decent ones left. Morgan Stanley and other investors should not be trying to undermine a valuable news operation. “Greed” isn’t good, Morgan Stanley. It can wreck our democracy. Responsible investors should take note. Placing at risk a key U.S. news institution does not show sound judgement.

PS: As I recount in my book, Morgan Stanley was one of the Wall Street firms praising the merger between AOL and Time Warner. Morgan Stanley’s assessment about the merger’s financial benefits to investors was used to help get the FCC to approve the deal. Morgan Stanley made money from the merger by earning a substantial transaction-related fee. But most investors suffered.

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MySpace News: Foxifying Web 2.0

Rupert Murdoch’s MySpace could soon be offering its users news, including likely reports on entertainment and “gossip.” Part of the goal is to get MySpace users to add, rate, and tag more content–all so the site can be a better targeting ground for interactive advertisers. But we wonder what the role will be of Fox News in the mix? Given the relationship which Fox’s TV properties have played on MySpace, will we see a right-wing skewing news slant on the leading social “adver-network?” Will Fox’s fantasy version of the news [there’s a liberal plot to make the U.S. a more humane place to live!] subtly be given preeminence?

People tracking News Corp/Fox should focus on what’s going on with MySpace. Mr. Murdoch has seen the future: Fox News on the digital database building beat.

Bill Keller of the NY Times Needs a Journalistic Reality Check

It’s hard to fathom why Bill Keller, executive editor of the New York Times, would respond this way to their public editor about the paper’s failure to quickly follow-up on the Post’s investigation of the Walter Reed/veteran health care scandal: “Until we verify — or until the story begins to have consequences — it’s second-hand information,” he wrote in an email. There were other reasons Keller gave as well, including pulling off reporters working on some other enterprise story in order to play catch-up. Keller also said that “News organizations are habitually slow at responding to stories broken elsewhere… The easy explanation, and one that contains a good measure of truth, is pride…Reporters (and editors) don’t enjoy being beaten.”

But is Keller really saying that when a serious news organization or journalist from a competing outlet documents a story of critical importance, the reaction should be ignoring it (as the Times did for a number of days with the Post’s Walter Reed story)? Keller needs to re-examine how his paper responds to news reported elsewhere. The failure of the Times to adequately challenge the false Bush Administration assertions that led to this tragic war will always, sadly, be part of the paper’s journalistic legacy. Keller and executives at the Times need to acknowledge immediately other key stories from competing news organizations–and then advance the story even further. We need more vibrant journalistic analysis and reporting. Ignoring competing news stories is bad for the public interest and is a foolish journalistic practice.

Source: “Reporting the News Even When a Competitor Gets There First.” Byrone Calame. New York Times. March 11, 2007. Reg. may be required.

Former Democratic FCC chairs William Kennard and Reed Hundt are holding a $2,300 a plate fundraiser for Senator Barack Obama, reports both the WSJ and NYT [reg. or sub. may be required]. Both Kennard and Hundt have deep relationships with corporate media interests that would unlikely support the kind of public interest agenda for the U.S. digital era that is required [Senator Clinton recently was given a Los Angeles fundraiser by Haim Saban, of “Mighty Morphin Power Rangers” infamy]. The role which big, special interest media and telecom money plays in shaping what will ultimately become the communications policy agenda for the next presidential administration must be addressed–and neutralized–now. Regardless of whether the next president is a Republican or Democrat, media connected money in the campaign will provide people and their ideas not only “access,” but a defining role. With so much at stake, it’s now time to press the candidates to support an all-encompassing public interest digital agenda. Think of local Web 2.0 services extending the power of community media; digital programming operations diversely owned, including by low income groups, women, people of color; a series of independent, well-resourced and competing news organizations; readily addressing the digital divide; assuring funding and distribution for a cornucopia of educational, children’s, cultural and non-commercial content; election reforms requiring “free time” for all digital platforms; and meaningful privacy protections and safeguards related to interactive advertising. Of course, they must agree they will support–and sign–a bill requiring non-discrimination, or neutrality, for U.S. broadband. Media advocates should not wait before they press candidates to reveal their agenda–or lack of–for the U.S. telecom future. Otherwise, as in the past, special interest media, technology, and telecom money will make sure nothing truly meaningful comes to pass.

Bill Gates Fails to Address Real Threats to Privacy–from Microsoft and other Interactive Advertisers

Here’s a link to the speech Mr. Gates gave at the CDT “gala” the other night. Note that Mr. Gates failed to address data collection related to marketing and advertising. Why? Because interactive advertising is Microsoft’s new business model. Mr. Gates and much of the industry wish to narrowly frame the debate, permitting both big business and government to have access to our data. Microsoft and its allies basically want a system where the default is data collection and microtargeting. What’s really needed are strong protections requiring an informed opt-in (which would require, for example, for Microsoft, Google, AOL, MySpace, etc. to precisely explain what is being collected and how it’s being used. Then ask for periodic affirmative permission).

Will the Advertising Industry "Step It Up" and Confront its Global Warming Role?

New personalized marketing technologies combined with a drive to occupy all communications channels to promote brands, is making advertising a more powerful force in our collective lives. From mobile to broadband branded video to interactive television, the global–and tightly consolidating–advertising industry is pushing for greater consumption of products. As technologies of persuasion are further mingled with pervasive interactive communications, one of the most powerful constant messages fixed to our identities will be to buy, buy, buy.

On April 14, 2007, there will be a “National Day of Climate Action,” also called “Step It Up 2007.” The goal is for an outpouring of public support in the U.S. telling Congress to “Step it up. Cut carbon 80 percent by 2050.” It’s time for leaders of the advertising industry to play a positive and proactive role to address the disastrous consequences of global warming. They must call upon their clients to change course. What’s needed now are messages promoting a world in ecological balance (at the very least). Ad executives should renounce efforts underway designed to create a marketing system featuring “immersive” environments, the constant data collection and tracking of our behaviors, and the exploitation of brain neuropsychology.

We will be returning to this topic frequently, as we shed light on the ad industry’s global schemes to create a “brandwashing” culture–regardless of the costs to society.