Why Google Can’t Say a Word that Starts With “P”—Privacy

The senior execs and DC lobbying team at Google really have a major problem addressing one of the company’s gravest problems–its lack of leadership protecting consumer/citizen privacy. While Google claims to reporters and others it’s been proactively strengthening its privacy policies, most of the changes have come as a result of pressure from policymakers and privacy advocates.

This week, Google released a booklet which “spelled out…2009 policy priorities” for the new Administration and Congress, including several Internet related issues. The booklet’s release coincided with a speech Google CEO Eric Schmidt gave at the New America Foundation in Washington, D.C. Missing from the booklet’s agenda was any discussion of privacy or the role and structure of online advertising (You would never know, for example, that Google was just forced by the Department of Justice’s antitrust division to drop its proposed deal with leading rival Yahoo!).

Google should be playing a leadership role supporting the enactment of serious privacy rights for the public–including “opt-in,” real transparency, user control, limits on retention, etc. If Google believes its golden digital goose will be baked once consumers better understand and control how they are being profiled and targeted, they should examine how it defines corporate social responsibility. But Google’s current approach—we can’t admit we are collecting your data for interactive marketing and cannot even say the word privacy in public-– will ultimately have consequences for Google’s future–including its share price.

New AT&T-funded “Future of Privacy” Group: Will it Support Real Privacy Protection or Serve as a Surrogate for Self-regulation and Data Collection?

A new group co-directed by former DoubleClick and AOL chief privacy officer Jules Polonetsky, called the “Future of Privacy Forum,” has been announced. It is connected to the law firm representing AT&T–Proskauer Rose–which has a considerable practice in the online marketing and data collection area. Other backers include Intel, General Electric, IBM and Wal-Mart.

We are concerned, however, that the role of the Forum is to help discourage Congress from enacting an opt-in regime for data collection. Both ISPs–such as AT&T, Verizon, Comcast and Time Warner–as well as online advertising companies such as Google/DoubleClick, Yahoo, and Microsoft must be governed by privacy laws which empower and protect consumers. The role of ISPs in any data collection for targeted online marketing, in particular, requires serious analysis and stringent safeguards. AT&T, Google, Microsoft, Comcast, the online ad networks, and social media marketers (to name a few) must be required to provide meaningful disclosure, transparency, accountability and user control (with special rules governing health, financial and data involving children and youth). Self-regulation has failed. If the Future of Privacy group is to have any legitimacy, it will work to support serious federal rules. But if it trots out some sort of voluntary code of conduct as a way to undermine the growing call for real privacy safeguards, this new group may soon be viewed as beholden to its funders and backers.

Project Canoe: Data-mining and Viewer Monitoring for Ad Targeting—-for banks, dog food, and your Cable Company

The cable TV industry’s interactive advertising consortium called Project Canoe is steadily moving ahead with plans that will harness more cable viewer data for profiling and targeting. Here’s some excerpts from a Hewlett-Packard blog:

“…Canoe’s first national go-to-market product is called Creative Versioning Platform which marries the cable industry’s ad zones with demographic databases, and this will offer national advertisers more targeted, relevant and effective advertising with commercials that run simultaneously across the national market with different messages and tags…

So who might this impact… How about consumer banking? Although there is a major consolidation in recent weeks with consumer banks, they still have specific audiences they are trying to target with their diverse banking products. Imagine Bank of America’s Private Wealth Management group only targeting household income over $150k with one specific message and another message for free checking account for households less than $75k. Or how about Purina dog food for only dog owners? Did you know that 40% of all U.S. TV households own a dog? The opportunities are endless.

Data – will be a major emphasis in Canoe’s charter…In the very near future, Canoe will have the ability to measure and monitor viewing via their set top boxes, second by second data by each box. Look familiar? That’s right, the Internet! These boxes will have in-dept and granular data for programmers and advertisers alike…Request for Information (RFI) – another basic feature with high potential…Pretty powerful stuff – high level of tracking…

T-Commerce…What could be better – you buy it during your favorite show, have it billed to your cable bill, have it shipped to your house (as the cable co. has your address) and you pay for it at the end of the month.

So who might this impact….How about credit card companies to begin with! And if the cable company offered to finance the purchases, they could create their own finance companies – similar to auto dealers. That’s called “extra income.”

source: The Changing Face of Media. Oct 6, 2008.

The Big $ Payout to Conservative Talk Hosts [Limbaugh, Hannity, O’Reilly, Beck]: Implications for Civil Discourse/Public Interest

As noted by Brian Lowry in Variety, “[W]e now live in the age of the endless election.” His column notes the mind-boggling deals that Rush Limbaugh, Sean Hannity, Bill O’Reilly, and Glenn Beck have recently negotiated. Limbaugh has a $400 million eight year radio deal; Hannity’s new radio contract provides a $100 million pay-out (and that doesn’t include his “multimillion-dollar deal with Fox News”); O’Reilly is staying on Fox for $10 million a year; Glenn Beck goes to Fox in 2009–which will reward him additional dough beyond his five-year $50 million radio deal.

This is a very significant investment in people and a communications infrastructure designed to attack and undermine the forces working for change in the U.S. (I’m being very polite!). They will engage in an effort to whip up anger, division, and personal rancor. There clearly needs to be a set of strategies designed to address the consequences of this conservative and right-wing attack machine. Beyond trying to resurrect/revise serious journalism, progressives will need to build out a sustainable digital media content system (social networks, mobile, online video services) that can help the country move forward.

source: “Some Campaigns Won’t Die.” Brian Lowry. Variety. November 3-9, 2008.

Google’s Eric Schmidt’s Bluster Against Antitrust Regulators: A Failure to Live Up to His Convictions?

In today’s New York Times, Google CEO Eric Schmidt suggests that everyone other than Google is confused, ignorant, or incorrect about how the search giant operates its online ad business. It seems in his worldview, no one–not certainly the Department of Justice–should have raised a finger of concern over its proposed alliance with Yahoo. Schmidt told the Times yesterday that “We canceled the deal with about one hour to go before a lawsuit was going to be filed against our deal. We concluded after a lot of soul-searching that it was not in our best interest to go through a lengthy and costly trial which we believe we ultimately would have won.”

If Mr. Schmidt really believed that he was right and everyone else was incorrect, he should have stood up and fought–instead of jilting Yahoo just as they were about to be conjoined. However, we believe that Google choose to abandon the deal because it didn’t want to further open itself to regulatory review–which would have demonstrated why its Yahoo deal would have been bad for competition and privacy.

Fewer Reporters Covering Health Care etc.: Why Fixing Journalism Should Be A Issue for New Congress and Administration

We have longed called for congressional hearings and new policies to address the journalistic melt-down and crisis roiling the country’s print newsrooms. Reporters working for major media companies are confronting stressful conditions as their corporate owners, and a tumultuous economy, create cutbacks and further reduce resources. How can we expect the country to better govern itself if it doesn’t have a press corps. able to ask the tough questions, force greater accountability etc. Here’s a very telling quote from a PR Week roundtable [Nov 3. 2008 issue] date: “… papers just don’t have healthcare reporters anymore. Some do, but not all. Right now with the election in Washington, I had a client who’s a good topic for the Style section of the Post, but all those reporters are being taken off to cover the election or the financial crisis.” And another PR exec added that: “There isn’t a week that goes by that we don’t get an e-mail about a beat reporter who’s been downsized or taking a buyout. For us, this is a reporter that’s been on the job a long time and has a lot of institutional knowledge. They’re gone and most of the time the paper won’t fill that position. Or if they do, they’ll use the wire services, and there’s no local angle, and one of the things about our industry is that it’s almost entirely local. We [now] spend a lot of time trying to educate those rookie reporters who now cover not only real estate, but healthcare, features, other things. So their attention on real estate is now one-fifteenth.”

While the comment was about placing a story for a health or real estate company, I think it illustrates the impact of the declining state of news organizations (if Obama were really a socialist, I would ask him to nationalize the Singleton and Tribune papers! That’s a joke!]. It’s time for the Newspaper Guild and media reform groups to press for hearings and answers. Helping news organizations better manage the transition to the digital era should be one topic. So too should be some of the proposals made by journalism scholars, such as in “Taking Stock.

Google’s DC Lobbying Office Warned Company About Now Scuttled Deal with Yahoo

The enterprising columnist Kara Swisher has done terrific work analyzing the now scuttled Google/Yahoo alliance. She has reported that Google’s lobbying office in Washington, D.C. actually tried to convince top company officials to not pursue the deal. The Google D.C. lobbyists correctly understood that the company is now under the “radar” of a growing number of regulators and privacy advocates from around the world. The failure of the company to heed this sound advice illustrates how its top management is out of touch with the realities of its own market and societal impact.
Here’s an excerpt from a recent Kara “Boomtown” column: “Early on, that was also a big worry of Google’s own operatives in D.C., who expressed concern–largely ignored at HQ, where execs really do see themselves as not even slightly evil–about its growing image as a scary behemoth.”

Online Ad Privacy Watch: Google Adding DoubleClick to its AdSense System

Policymakers will need to closely examine the role DoubleClick will play in collecting, analyzing, and helping profile consumers (whether they are online, seeing a video, or using a mobile device, for example). Here’s an email Google is reported sending out this week. My bold:

“We understand that the recent economic turmoil has created a lot of uncertainty in the lives of AdSense publishers. During these difficult times, we’re continuing to invest in innovations that improve publisher monetization and advertiser value in the content network.

We’re focusing on further developing our product offerings and boosting ad performance for publishers. We recently announced advancements in AdSense for search and experiments to make ads more effective. We’re bringing DoubleClick technologies to AdSense publishers, and we’ll continue to launch new products and features. We’re also continuing to improve our offerings for AdWords advertisers, making it easier for them to target the Google content network. Features for advertisers, such as the new display ad builder, are designed to improve ad performance on AdSense publisher sites.

We’ll keep driving technological progress, but our best asset will always be our publisher partners. The strength of AdSense lies in the value of the content you bring to users and the quality of the sites you bring to advertisers. Our success is tied to yours. We look forward to partnering with you for the long term, and remain dedicated to helping you succeed.”

Google Expanding its Online Video Advertising via Rich Media Applications and Commissions to Ad Agencies

Along with its new research fund for academics and its work to harness neuromarketing, Google is now luring more advertisers to run ads on YouTube and its content network. Here’s an excerpt from the UK’s New Media Age [a terrific] trade publication: “Google is to introduce agency commission for video advertising to encourage increased investment and progress within the sector. The company says it will launch an “incentivisation programme” to show Google’s commitment in developing video advertising opportunities across its network, including YouTube…Google is… also working with rich-media specialist Tangozebra, which it acquired as part of the DoubleClick deal, to develop new ad formats…

Jonathan Gillespie, Google head of media solutions and YouTube in the UK, said, “We believe that online video specifically is going to be the next stage of evolution in the display marketplace.”

source: Google to introduce agency commission on video ads. Will Cooper. NMA. October 31, 2008

Google’s new funding program for Academics: $ for studies on “Brand Development,” Click Generation” and “for moving traditional video spots from broadcast to broadband”

The advertising industry is engaged in a growing research effort to push the boundaries of marketing. It wishes, for example, to reach deeply into our unconscious mind in order to generate a range of behavioral responses. Marketers are exploring how the new tools of digital advertising can influence consumer emotions.

For example, Google is now engaged in consumer neuroscience research to make its YouTube ads more effective. But Google wants more academic help so it can improve its digital marketing prowess. So Google and global ad giant WPP have joined forces to create “a new research program to improve understanding and practices in online marketing, and to better understand the relationship between online and offline media.” The program will be run by a trio of scholars, including Google’s own Hal Varian, Professor John Quelch, senior associate dean of Harvard Business School (who is a a non-executive director of WPP), and Professor Glen Urban, former dean of the Sloan School of Management at the Massachusetts Institute of Technology. Varian told DM News that “We want to encourage more research about how online and offline media work together to influence consumer choices. We think that such research will contribute to more effective and more measurable advertising performance.” DM News also reported that Mark Read, CEO of WPP Digital and WPP’s director of strategy explained that “[T]he industry, our clients and our companies will benefit from the application of some of the world’s finest academic research minds into how online media influences consumers.”

Don’t expect, by the way, any grants to be awarded that examine the ethical dimensions of interactive marketing; or new threats to personal privacy and autonomy; the implications of Google’s growing global control over online ad revenues on publishing; or the negative environmental and social consequences of promoting a digital marketing system which could lead to over-consumption.

Here are some of the research questions Google hopes will draw academics into its program:

    • How does a brand establish a framework for assessing how much should be spent online? How much advertising should be directed at brand development versus specific click generation?…
    • How do you set digital advertising budgets and tactics when in intensively competitive product categories?…
    • What are good guidelines for moving traditional video spots from broadcast to broadband?
    • What is the causal relationship between brand health and search success? And what is the link between search and sales? How does search contribute to word of mouth recommendation?
    • How can banner ads be more effective?
    • How do you model the consumer response to digital advertising in social networks or mobile media?
    • What do we know and what more do we need to know about on-line audiences?
    • How can advertisers be welcome in social networks?
    • Recipients will be invited to attend a conference in Fall 2009 (Sept/Oct) where they can share their preliminary findings.