Ad Age reports that Google sales exec Tim Armstrong “is calling for a town hall meeting with the Association of National Advertisers.” [sub. may be required]. The ad association has come out against the proposed Google/Yahoo search ad combine. But such a meeting shouldn’t be a closed door `only the ad biz’ event. By now, Google’s key execs should recognize that the search and online ad market is connected to such issues as privacy, the state of competition, and the future of funding diverse content online. This isn’t an issue that should be constructed by Google as an insider deal. The full range of public policy issues must be debated–including the participation of independent advocates and academic experts to discuss privacy and related concerns. Let Google, the advertisers, critics, supporters, and those in-between have their say–and make it available prominently on YouTube.
MySpace, Social Networks, Massive Data-Mining, Privacy & Interactive Advertising
Policymakers–including state attorneys-general, the FTC and EU officials– are failing to examine how social networks such as MySpace are utilizing advanced data mining techniques to track, analyze, and target millions of unsuspecting users (including, likely, adolescents). For example, MySpace (and other Fox Interactive Media properties, FIM) are using data warehouse and parallel computing techniques that “is enabling a new set of applications and services that previously were simply neither possible nor practical at this scale.”
MySpace and other FIM entities are engaged in daily “real-time” analysis of massive data sets from its 190 million active users. Such data analysis is driving FIM’s “advanced targeted advertising systems.” So all the MySpace “user-generated content” becomes fodder for the analytical ad-targeting. Such data collection must be under the full control of the user–they need to know how and what is being collected, how its used, what inferences are made, the range of ad and marketing targeting linked to the data, etc. It’s time social media marketing, as the industry calls it, draws the attention of policymakers, including the U.S., Canada, and in the EU.
Embedding Brands in Videogames
The growth of in-game marketing should be on the public policy radar. It’s something we have been following with food and beverage marketing targeting children and adolescents. Read this excerpt from a Double Fusion ad for a regional sales manager. Then ask yourself: does this business model raise consumer protection and public welfare concerns.
excerpt: “Want to place brands in games? Double Fusion’s Core Games Group is looking for a passionate gamer with the desire to sell marketers on the sexy allure of the gaming console as a means to reach the increasingly allusive 18-34 Male demographic. The Regional Sales Manager, Core Games Group will be responsible for using Double Fusion’s multi-platform approach (static in-game advertising, dynamic in-game advertising, gaming tournaments, downloadable content, co-marketing partnerships, etc) to in-game advertising to meet marketers’ campaign objectives in the most engaging ways imaginable.
…Double Fusion connects brands with audiences through the immersive medium of games…our integrated marketing solutions continue to inspire Fortune 500 companies to get in the game with groundbreaking advertising campaigns…Chance to make media history in a “rising star†category – interactive entertainment is one of the fastest growing categories across female audiences and advertisers are just beginning to realize this huge market potential…Our unique media capabilities across 2D and 3D games allow advertisers to benefit from a level of interaction that’s simply not possible with traditional advertising. In fact, research from Nielsen has shown the superior recall and purchase preference results that 3D programs deliver. The best of both worlds – we’re well-funded with financial backing from top-tier venture capital firms plus media giants such as Time Warner and Hearst…”
A Op-ed Supporting a Google/Yahoo Deal by a Lawyer Who Recently Represented Google?
Glenn B. Manishin, an antitrust attorney, wrote an op-ed yesterday [reg. required] in the San Jose Mercury News which supported the proposed Google/Yahoo alliance. We take no issue with Mr. Manishin expressing his opinion (although we do profoundly disagree with his analysis and conclusions). But we do find it disconcerting to read his resume and see that Google is listed as his recent client [he’s now at a different firm]. Such a disclosure to readers should have been a prominent part of his article. Here’s the excerpt from Mr. Manishin’s CV [with one client in our bold]:
Partner, Kelley Drye & Warren LLP (2001-08) 
Chaired DC/VA Litigation Practice for this New York-based firm and architeched its expansion from legacy telecom regulatory compliance to the policy and legal disputes affecting the new economy. Representative clients included Oracle, Computer & Communications Industry Association (CCIA), Google, Recording Industry Association of America (RIAA), ProComp, Vonage, Return Path, Global NAPs, BroadVoice, IDT, Telos, Winstar Communications, Association of Local Telecommunications Services (ALTS), Consumer Federation of America and Consumers Union. Lead litigation counsel in several trend-setting antitrust cases arising out of the impact of deregulation in the telecommunications industry.
Cable TV and Your Privacy: Time to Address Looming Threats
It’s not just the cable television industry’s position on network management [network neutrality] that is a problem. So too is its expanding use of customer data for profiling, analysis, and targeting. Project Canoe [the cable initiative on targeted interactive advertising] is only one part of cable’s data-driven plans. As cable trade CED reports, the industry has geared up to reap the rewards from its extensive data mining services. Here’s are some excerpts: “Add to the marketing mix a mountain of data and metadata generated by sophisticated billing systems and third-party data companies, and it’s little wonder why the marketing of cable versus the competition is changing dramatically…“We’ve built 10-12 statistical/propensity models of people who would likely take a service, and we are refining that technique. We’ve seen a very significant increase in take rates” [explained Tim Doolittle, vice president of marketing science for Charter Communications]…”Data is captured through the billing system and cross-tabulated with marketing efforts” [noted Steve Brookstein, executive vice president of operations for Bresnan Communications]…they need data they can understand to build marketing models,†said Chris McDonald, president of Pluris Inc., a leading provider of data organization and analytics.
That data, he maintains, is coming from a variety of sources such as billing systems and third parties…The addition of emerging data points, such as data coming from the Internet, e-mail and customer service online, is extremely valuable, McDonald says.
“It’s valuable data knowing how customers are behaving.” [our emphasis]
source: Fighting for The Money. Craig Kuhl. CEDMagazine.com. October 1, 2008
Two years after CDD & USPIRG warn about online advertising & media consolidation, a call to “monitor the state of competition”
Yesterday, Sen. Herb Kohl, the chair of the Senate Antitrust Committee, sent a letter to the Department of Justice about the proposed Google/Yahoo alliance. Two years ago next month, in its initial complaint filed at the Federal Trade Commission calling for an investigation into behavioral online ad targeting, CDD and USPIRG also petitioned the agency to open up an antitrust investigation. It was clear two years ago–as one surveyed the dizzying global shopping spree by Google, Yahoo, Microsoft, Time Warner/AOL–that a tiny handful would soon dominate the online ad market. Given that online ad revenues are the key to the funding of almost all interactive and online content, we were disturbed by the trend then towards consolidation. Of course, fewer companies controlling all that consumer data also raised fundamental privacy concerns.
Two years later, of course, we have even fewer independent companies left standing. Google swallowed DoubleClick (and is poised to partially operate Yahoo); Yahoo acquired Blue Lithium and Right Media; Microsoft acquired giant aQuantive; Time Warner bought Tacoda and Third Screen Media. Etc.
Regulators on both sides of the Atlantic have been asleep at the digital switch. They have failed to both protect competition and privacy. However, there is a growing awareness that there are serious problems looming. As we know, the same deregulatory philosophy which helped wreck our economy is also the foundation for communications and media policy. It is accompanied, of course, by a `golden’ revolving door between government and private industry that has left consumers and citizens vulnerable to a wholesale set of unfair practices. Addressing these issues will be the focus of much work over the next several years.
Time Warner’s Platform A Wants a “Behavioral Advertising Sales Specialist”
I don’t see a concern with consumer privacy part of this job announcement. Take a look at this excerpt:
“Platform-A is seeking an experienced Account Executive who will be the specialist in Behavioral Advertising Sales. The AE will be responsible for managing the relationships with current Platform-A clients and building strong partnerships with future clients. Candidates will manage behavioral business solutions to maximize revenue potential and identify new ventures. The Behavioral Specialist is expected to proactively prospect, qualify, grow and maintain client accounts to meet or exceed sales goals.
We are looking for someone to help educate clients and agencies on behavioral targeting solutions and acclimate regional sales managers on behavioral selling. Candidates should have entrepreneurial spirit and enjoy working in an exciting and fast-paced environment. Knowledge and experience with Behavioral Advertising strongly preferred.”
Google Receives Lion’s Share of Obama Online Ad Campaign Spend
The enterprising Kate Kaye from Clickz posted an article on Sen. Obama’s online ad spending. The latest stats, she notes, is nearly $5.5 million, with $3.3 spent on Google. In a telling commentary on the state of search marketing competition, Mr. Obama’s campaign spent only $700,000 on Yahoo and a slightly less than $250k for Microsoft/MSN. See Ms. Kaye’s piece for more details.
Network Advertising Initiative Continues to Protect Online Marketers Interests Instead of Consumer Privacy
The Network Advertising Initiative’s (NAI) real role is to protect the ability of its members (Google, Yahoo!, AOL, etc.) to collect huge amounts of profiling and targeting data from each of us. NAI claims it’s promoting self-regulation on data privacy through its principles and guidelines. But NAI has long been a toothless group, and is basically a public relations vehicle helping to cover the data crime and more-than-misdemeanors of the industry.
So it’s not surprising that last week, the NAI announced that while it supported an “opt-in” for the kind of behavioral targeting planned by the phone and cable companies, it didn’t believe such a safeguard was required for its data-collected membership. In a statement, NAI Executive Director Trevor Hughes said that his group “believes that opt-out continues to be an appropriate choice mechanism for traditional web-based behavioral advertising and this is part of our sliding scale framework.” That’s the political position taken, of course, by his members. They are the biggest behavioral targeters on the planet.
The NAI is a weak group which reflects the cynical view of the online ad industry. NAI members hope that they can fool policymakers into believing consumer privacy can be safeguarded by the data wolves running the privacy hen house. The battle lines for the next Congress, the FTC and FCC are being drawn. Opt-out is a feckless approach to digital ad privacy. Responsible companies should be in the lead calling for meaningful opt-in. Note to NAI members: Deregulation and industry self-governance–how shall I put it–doesn’t seem to have worked that well so far!
Interactive Ad Bureau to Congress and Public: If Your Privacy is Protected, The Internet Will Fail Like Wall Street!
It’s too disquieting a time in the U.S. to dismiss what a lobbyist for the Interactive Advertising Bureau said as merely silly. The IAB lobbyist is quoted in today’s Washington Post saying: “If Congress required ‘opt in’ today, Congress would be back in tomorrow writing an Internet bailout bill. Every advertising platform and business model would be put at risk.” [reg. required]
Why is the IAB afraid of honest consumer disclosure and consumer control? If online ad leaders can’t imagine a world where the industry still makes lots of money–while simultaneously respecting consumer privacy–perhaps they should choose another profession (say investment banking!).
Seriously, online ad leaders need to acknowledge that reasonable federal rules are required that safeguard consumers (with meaningful policies especially protecting children and adolescents, as well as adult financial, health, and political data). The industry doesn’t need a bail-out. But its leaders should `opt-in’ to a responsible position for online consumer privacy protection.