Ford

We don’t know anything about the work and personal interests of Mr. Luis Ubiñas. But he’s the in-coming president of the Ford Foundation. Ford is a premier public foundation working to promote a global civil society. We hope that Mr. Ubiñas will seize the initiative to fund a variety of efforts designed to foster a global democratic digital media environment. That means funding advocacy groups representing the interests of the public as both consumers and citizens (even if it means taking on the clients that he has worked with while at McKinsey and Co.); helping fund sustainable and responsible models for multi-platform and multi-media content production; promoting a diverse range of owned and operated services that reflect the interests of and are controlled by low-income and minority/new majority groups; helping journalism make the transition to the digital era; ensuring the new media truly contributes to electoral reform. Of course, dealing with the digital divide, open broadband networks, the future of public media, and privacy must also on the agenda. Such work must address the problems in the U.S., as politically thorny as they are. [We know there’s more to add to such a list. This is just starters].
This is not meant as a self-serving comment, as we’ve been funded by Ford in the past. It’s in the spirit of being on-the-record that someone with a great deal of media industry knowledge is taking over a key philanthropic institution. And it’s occurring during a critical turning point for the future of democratic communications, in the U.S. and everywhere else.

Here’s his bio from a Digital Hollywood conference: “Luis Ubiñas is a Director in McKinsey & Company’s West Coast Media, Entertainment and Technology Practice, dividing his time between offices in San Francisco and Los Angeles and also overseeing the practice in Seattle and Denver. Since joining the Firm in 1989, he has focused on serving media, communications and technology companies undergoing major change -entering or exiting businesses or redesigning core processes. Luis has extensive experience in the telecommunications and cable industries: helping build consumer high-speed data businesses; introducing advanced digital set-top boxes and services; and, now, helping design the early VOIP trials. In cable operations, he has worked with MSOs across a broad range of activities, including channel line-up standardization, rebuild prioritization, and purchasing. Luis’ work for other media companies has been operations-focused, helping several newspapers improve circulation and advertising sales and working with content companies to improve international distribution and developing digital distribution strategies. For technology companies, Luis has worked with early entrants in the home networking, digital set-top box manufacturers and other hardware providers. In addition, he has served a large number of technology start-ups as part of his work with venture capital firms. Before joining McKinsey, Luis worked at Booz, Allen & Hamilton, concentrating on marketing and strategy assignments. He also worked briefly as a reporter for the Los Angeles Times, The Wall Street Journal, and as assistant to the CEO of the Honduran beer and soft drink (Coca-Cola) monopoly. Luis has an A.B. in government, magna cum laude, from Harvard College, and an M.B.A. (Baker scholar) from Harvard Business School. He currently serves on the Boards of the Digital Coast Roundtable in Los Angeles and the SteppingStone Foundation in Boston.”

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CDT’s Privacy “Report”—Full Disclosure is Missing

CDT has long been an ally of the various data collection companies it purports to oversee on behalf of consumers. It’s funded by a number of them. In fact Microsoft’s Bill Gates helped raise money for the group just last March.

The report released today fails to address the wide-ranging privacy threat coming from the major search engines and their advertising clients. It fails to acknowledge that it’s only because of policy-related pressure from privacy advocates—including the FTC complaint filed last November by my Center for Digital Democracy and US PIRG—that there have been modest corporate changes. [As well as the work of these two groups and EPIC in the case of Google’s proposed merger with Doubleclick, and the role of European Commission authorities]. CDT’s report also fails to acknowledge that it’s because of the unprecedented series of mergers in the data collection sector over the last few months, including Google, Microsoft, Yahoo!, AOL [$33.4 billion in the first half of 2007 alone, according to Ad Age. sub may be required.] —and the subsequent US and international regulatory scrutiny—that has created the “pressure” to bring about a few modest changes in data collection and retention practices. Without real advocates pressing—and regulators taking up their demands—we would have no changes at all (as minimal as they are). The marketplace’s approach isn’t protecting consumers.

Most troubling is that CDT fails to acknowledge that the widespread and evolving role of interactive advertising practices by these companies—including behavioral targeting, “rich” immersive media, and virtual reality formats—pose a serious threat to privacy and personal autonomy. It is not just the “bad” actors that require federal legislation, as CDT’s report suggests. If all Americans are to be protected online, the entire industry must be governed by federal policies designed to ensure privacy and consumer protection.

Here is a comment from my colleague Jennifer Harris: “When a group – with as close ties to the industry as CDT has – calls for government oversight, it is necessary to recognize just how much slack the online advertising and marketing industry has been given with our personal information. The main point is that consumers are at risk; updated federal consumer protection policies are essential to an environment that increasingly uses personal data as its commodity.”

FCC Chairmen and the Revolving Industry Door: A Higher Standard is Required

The list of former FCC chairs working in the media and communications business–either as lobbyists, consultants, or investors–is in illustration of why the commission is badly in need of reform. One day a chair is overseeing a media company–or a policy directly affecting it. The next day–after they leave office–they are working for the company or the industry. We really require FCC commissioners who are independent of the media and communications industry–before and after they leave the commission.

Michael Powell took a job as senior advisor at the buy-out firm Providence Equity Partners. Since he joined the firm, they have acquired–in whole or part–TV stations, a spanish language network, other media properties. Take a look at this report from the Los Angeles Times about the Orange County Register and note the role of Powell’s Providence. The deal was made prior to Powell joining the firm, but he’s there now, while these layoffs are happening [my italics]:

“Newsroom staffers described a morose — and tense — newsroom. Dragging out the layoffs for a week, they said, seemed particularly cruel and stressful.

“The way they’re doing this is just horrible,” one longtime staffer said. “It’s like, ‘Thanks for everything. Get out. Here’s some boxes, start packing.’ ”
…In 2004, privately held Freedom Communications Inc., parent of the Register, worked out a $1.3-billion buyout deal that saw more than half of the members of the founding Hoiles clan cash out their holdings and private equity firms Blackstone Group and Providence Equity Partners purchase nearly 40% of the shares. At the time, insiders said the investors borrowed a little less than $1 billion and provided about $400 million more in private capital to finance the deal.”

Then we have former Clinton appointed chair Reed Hundt engaged in his favorite twin occupation of media industry guru/investor. Hundt had been helping lead the effort by his Frontline Wireless company to have the commission approve policies compatible to his interests. Even former Reagan-era FCC chair Mark Fowler is working with Hundt’s Frontline.

FCC reform should be at the top of the public interest policy agenda, esp. with the future of democratic communications at stake.
source for Powell/Provide/OC Register story: “O.C. Register lays off workers: The newspaper will also trim news space to reduce costs as its revenue decline.” Kimi Yoshino. Los Angeles Times. Aug. 7, 2007.

Yesterday, the FTC sent out a release announcing its November town meeting on online advertising and privacy. The hearing is in response to the formal complaint my group Center for Digital Democracy and the USPIRG filed last November.

It’s clear that the FTC is fearful of really tackling the privacy and consumer-manipulation problems intrinsic to the online ad field. Behavioral targeting, which we also address in our complaint, is just the tip of the proverbial data collection and target marketing iceberg. Policymakers at the FTC, the Congress, and state A-G’s must do a better job in addressing this problem. Chapter seven of my book covers the topic, along with recommendations. As we noted in our statement yesterday, CDD has given the staff at the FTC a ton of material since November, further making the case for immediate federal safeguards. There is so much at stake regarding the future of our (global) democratic culture and its relationship to online marketing. We hope others will join with us and raise the larger societal issues, in addition to the specific online ad marketplace concerns.

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Ad Age’s Perceptive Piece on Murdoch and WSJ Future

We think this point by Matthew Creamer deserves a highlight:

“A News Corp.-owned Wall Street Journal begs a question: In a world where the attention of consumers and hence advertisers is divided among video games, “American Idol” and LOLCats, can a business built solely to deliver news — especially long, serious articles about complicated topics — remain independent and successful? … The nation’s leading purveyor of business information, still an agenda-setter for the planet’s biggest economy, becomes a cog in a vertically integrated, multinational creator and distributor of entertainment, a machine engineered to pump out synergies such as “The Simpsons” movie or, more scarily, that aborted O.J. Simpson extravaganza, rather than Pulitzers… Sure, Mr. Murdoch will pump capital into the paper, allowing it to build out its international operation, but some are predicting that one effect of that bulking up could be to further his business goals, especially in China. And Journal reportage, now a means to the purist end of watchdogging the business community, will be called upon also to add more grist to that massive multimedia content mill, in the form of the Fox Business Network — which is already being positioned as more pro-business than CNBC, absurd as that sounds.”

from: “Stand-Alone News Brands Are Doomed.” Matthew Creamer. Advertising Age. Aug 6, 2007 [sub may be required]

As Murdoch-run WSJ Plans to compete with NYT, FCC Must Review its status as “national” newspaper

We have urged several FCC commissioners to support a review of the Wall Street Journal and its relationship to the New York City DMA. We believe that News Corp.’s plans to have the Journal compete with the New York Times, among other factors, require serious scrutiny by the commission. The broadcast-newspaper cross-ownership safeguard, we suggest, may apply in this case.

As the Journal reported on August 1, 2007:

“Just as vulnerable could be the New York Times, published by New York Times Co., and Pearson PLC’s Financial Times. In a May letter to Dow Jones’s controlling shareholders, the Bancroft family, Mr. Murdoch said he would want Dow Jones properties to “reach a broader domestic audience by expanding the content base.” He emphasized yesterday he “would not want to step back from any of the business coverage” but he would “like to add more general news,” repeating comments about plans to expand the Journal’s Washington bureau. He said that to accomplish his goal there “could be another four pages a day” for news coverage. A person with knowledge of his plans said Mr. Murdoch believes more general news and political coverage would make the Journal a stronger rival to the New York Times, which has a bigger share of consumer advertising.”

Ad Age reported [listen to Nat Ives video] that News Corp. is even considering adding sports news to the Journal, as it competes “head-to-head” with the Times.

As for calls for a national cross-ownership safeguard, we point to the recommendations in our new book which describe a new model for measuring media diversity in the digital era. But if new safeguards are to be enacted, foremost should be policies supporting sustainable community and national services that provide for both diverse expression–and news gathering/reporting–in the digital and multi-platform interactive era. In other words, we should be focused on adding what is missing and will still be ignored by the mainstream. They haven’t got it right so far–and won’t in the future.
Source for Wall Street J. quote: “Deal Will Test a Media Titan’s Instincts:
Rupert Murdoch’s Long-Sought Purchase
Of Dow Jones Could Change Business Journalism”
By MARTIN PEERS, SUZANNE VRANICA and STEPHANIE KANG
August 1, 2007; Page B1

Google Exec. Helps Define Online Ad Market

excerpt: “Google gets nearly all of its revenue from selling text-based
ads that appear near search results. But about half the market is made up
of graphical display ads, also known as banner or branding ads. The
display ad market is too big for Google to ignore, said Susan Wojcicki, a
Google product manager, during the meeting.

“We are focused on the branding market,” she said.

The online ad market is “search and display — and there isn’t a lot after
that,” she said.”
from: Video, Cell, Display Ads Get More Google Focus. Investor’s Business Daily. Aug. 2, 2007.

Google’s “Fortune 1000” Ad Sales Job Announcement: Getting Ready for Doubleclick?

From Google job post: ”

Senior Account Executive, Finance Vertical – New York

This position is located in New York, NY.

The area: Advertising Sales, Direct Sales Organization

At Google, we organize and change around our users and customers. Google’s Advertising Sales team embodies that pursuit: We’re devoted to finding relevant solutions that meet our clients’ changing advertising needs. In that regard, Advertising Sales does more than simply make money for our company. Our efforts focus on the ways that Google technology enables the world’s biggest advertisers to enjoy immediate and accountable communication with the consumer. Advertising Sales team members work hard to identify our clients’ business challenges, to collaboratively shape solutions that drive their strategic initiatives, and to keep them educated and informed in the ways that current and future Google products can enhance their online and/or offline presence. Google Sales teams are structured according to industry sectors, with those in our Direct Sales Organization (DSO) emphasizing Google’s value to the Finance industry.

The role: Senior Account Executive, Finance Vertical – New York

As a Google Financial Services Account Executive, you’ll work with the biggest financial services companies in the world. This includes investment, credit card, tax, banking and insurance companies The primary responsibility of the DSO Account Executive is to drive and grow new business revenue with Fortune 1000 advertisers in the Finance 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.”

Google Expands its Behavioral Targeting for Interactive Advertising

excerpt via ClickZ, July 31, 2007:

“Many have expected the behavioral targeting shoe would eventually drop at Google, and now it has. Technically, anyway, though a new behavior-based ad system enhancement from the company’s ad quality group doesn’t resemble the segmentation-based approach to behavioral targeting most marketers are familiar with.

A few weeks ago, Google began delivering ads based not only on the current search, but also on the searches immediately preceding it, and sometimes a combination of more than one recent query, according to Nick Fox, Google’s group business product manager for ads quality. Fox told ClickZ this week that the feature, which has no official name, aims to capture a more robust understanding of user intent and thereby deliver a better ad.

“The current query the user is issuing is pretty useful, but in some cases it misses the context of what the user is doing,” said Fox. By studying the larger context of queries relating to a consumer’s “overall task,” he said, Google can boost relevance…

Fox doesn’t like the term “behavioral targeting,” partly because it’s a loaded phrase in marketing and privacy circles. Additionally, he said, Google’s intent-based approach doesn’t employ the audience segmentation favored by Tacoda, Revenue Science and other behavioral targeting tech firms, not to mention BT-friendly media sites like Yahoo, that serve ads based on recent Web pages seen…

Google introduced the feature without fanfare, and most if not all marketers whose ads are affected by it have no idea the targeting is taking place. That’s true to form for Google and potentially irritating to advertisers, according to Anna Papadopoulos, interactive media director for Euro RSCG 4D…

Papadopoulos also finds it remarkable that Google has changed its tune with regard to behavior-based ad serving.

“I think it’s a total turning point for them,” she said. “Now I’m curious how they’re going to handle this for AdSense. They were pretty steadfast about not wanting to play in the behavioral targeting space.”

Google didn’t immediately respond to questions about where else on the Google network the company might consider delivering ads based on consumers’ prior search or surfing behavior. But it’s something the company opened the door to some time ago, according to Dave Morgan, founder and chairman of Tacoda.

“As an observer in the market, certainly Google’s move into behavioral targeting appears to have been happening incrementally over the past couple years,” he said. “Certainly they’ve modified their privacy policy over time to permit it.”…

Google’s new ad quality feature uses referrer information rather than cookies to track user queries at this time, Google’s Fox said. In most cases the ads will only appear to users for searches performed back-to-back or “within seconds or minutes of each other.” He added the company is looking at other possible tracking and targeting methods to capture “full intent,” including, perhaps, cookies.”

source: “Google Targets Search Ads on Prior Queries, à la Behavioral.” Zachary Rogers. ClickkZ.

Bravo! for FCC Commissioner Copps: Will other Officials (Hello Democrats in Congress) Call on FCC to Investigate Concerns about Murdoch & Cross-Ownership?

Michael Copps remains one of the most interesting public-service minded officials ever to serve the Federal Communications Commission. He has put concerns about the public before the interests of the media conglomerates, helping give meaning behind the public interest clause of the Communications Act.

Yesterday, Commissioner Copps correctly called into question Rupert Murdoch’s News Corp. acquisition of the Wall Street Journal, noting that there is a key role for the FCC. After all, Fox already owns both the New York Post and TV station “Fox 5” and TV Station WWOR in the New York market. The notion that the Journal is strictly a national paper, and hence outside the broadcast-newspaper cross-ownership rules needs to be seriously examined. Indeed, Mr. Murdoch’s own desire to better compete with the New York Times suggests that the Journal needs to be seen as part of the New York DMA. Hence, the cross-ownership safeguards should apply. At the very least, the FCC should be deluged with letters and emails demanding a serious inquiry into the nature of the Journal in relationship to the rest of Murdoch’s New York area holdings and FCC rules. FCC approval of the deal, as Mr. Copps noted, should not be considered a “slam-dunk.”

We hope that leaders in the Congress–especially Reps. Ed Markey, Dingell, Conyers & Sens. Inouye and Dorgan–will issue public calls to Chairman Martin to conduct an in-depth inquiry. Republicans only recently concerned about cross-ownership should also be pressed to speak up–that should include Senators such as Snowe, Lott and Hutchison.

Here’s what Advertising Age’s Nat Ives reported, including a quote from Commissioner Copps: “This deal means more media consolidation and fewer independent voices, and it specifically impacts the local market in New York City,” Mr. Copps continued. “What’s good for shareholders of huge media conglomerates isn’t always what’s good for the public interest or our civic dialogue. We should immediately conduct a careful factual and legal analysis of the transaction to determine how it implicates specific FCC rules and our overarching statutory obligation to protect the public interest. I hope nobody views this as a slam-dunk.”