Follow the Data—N.Y.Times Overlooks

Today’s business story on Microsoft’s online business honcho Steve Berkowitz over-looked a key critical dimension with what is really going on at that company. Microsoft is now focused on interactive advertising–and data collection–as a primary source of revenue. Microsoft has turned every bit of itself into a system that serves the needs of its adCenter [Microsoft Digital Advertising Solutions]. As we explained recently in a complaint to the Federal Trade Commission, Microsoft’s bundling of search, rich media, user-generated content (blogs, videos), email, instant messenger, etc. to help collect the data used for advertising microtargeting is on the cutting-edge of what threatens consumer privacy, in the U.S. and everywhere else.

We hope that the news media will look closely at its own operations as its relates to interactive marketing and privacy. Everyone, including the New York Times, is engaged in interactive data collection and ad schemes that threaten our privacy. Perhaps if business reporters, editorial boards, and executive producers were willing to cast a critical eye at themselves in this regard, we would have business stories that got to the core of what is driving e-commerce today.

“Looking for a Gambit To Win at Google’s Game.” Saul Hansell, NYT. 12/9/06

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CDT Works to Undermine the Public Interest in Broadband/ Allies with PFF

The Center for Democracy and Technology (CDT) has long served as part of the political support system for the telecom and media industries. While many view CDT as a privacy group, a great deal of what the organization does benefits its corporate supporters—which have been some of the biggest media and data collection companies in the country. They have included Axciom, Doubleclick, Time Warner, AT&T, Microsoft, Yahoo!, Google and Intel.

Now, CDT has joined forces with one of the key corporate funded groups that has been leading the charge against network neutrality: the Progress and Freedom Foundation. PFF, co-founded by Newt Gingrich, is also supported by numerous corporate media/telecom interests, including Murdoch’s News Corp. (Fox), AT&T, BellSouth, Comcast, Clear Channel, GE/NBC, Google and Microsoft.

Yesterday, the two groups jointly filed amicus briefs in federal courts supporting News Corp./Fox and NBC’s efforts to undermine the ability of the FCC to regulate communications. The TV networks are fighting the FCC’s recent decisions on broadcast indecency. But the CDT/PFF filing wasn’t only about over-turning the FCC’s foolhardy and inappropriate efforts on so-called indecent content. The message CDT and PFF gave to the courts was they should rein in any effort by the FCC to ensure that the public interest be served in the digital media era. The filing claims that convergence of various media, including the Internet, make any policy role for the FCC related to diversity of content a threat to free speech itself. A very convenient argument that must warm the hearts of both CDT’s and PFF’s corporate funders, because they are precisely the companies who wish to avoid having a public interest regulatory regime in broadband.

Missing from the brief is any discussion of the regulatory areas for broadband (including PC, mobile, and digital TV [IPTV] platforms) that will require federal policy, including a key role for the FCC. Among them, ensuring an open, non-discriminatory content distribution policy for the Internet—network neutrality. Other rules that will require FCC action in the broadband era include ensuring “free” and “equal” time for political speech; diversity of content ownership, including by women and persons of color; localism; public service; privacy; and advertising regulation. There will need to be ad safeguards, for example, protecting children from interactive marketing that promotes obesity as well as with prescription drug ads targeting seniors via immersive “one-to-one” media techniques.

CDT and PFF argue that the new media environment provides the public with greater choice, another reason they urge the courts to limit FCC authority. But what’s really happening with digital media is that we are facing a system where the “choices” are being meaningfully reduced by the market. Wherever the public goes, the forces of conglomerate media and advertising will confront them. Consider, for example, News Corp.‘s MySpace now running Fox programming. (It’s interestingly, by the way, that neither CDT nor PFF told the courts that they have a financial relationship with some of the interests involved in the indecency debate).

We have long opposed FCC efforts to “regulate” indecency, including being critical of FCC Commissioner Michael Copps (whom we otherwise strongly admire). The indecency effort by the FCC has helped let it become vulnerable to this attack by the media conglomerates, and their supporters, who have a longstanding political agenda aimed at sweeping away all regulation and safeguards. Fox, NBC, Viacom, Disney and the rest want a U.S. media system where they can own as many media outlets as they want, not have to do any public service, nor worry about regulators concerned about threats to privacy and interactive marketing abuses.

The emerging broadband era in the U.S. will see us face further consolidation of ownership of media outlets, including the Internet, as well as an increase in overall commercialization. The cry that Wall Street has for broadband is “monetization.” But our electronic media system must also serve democracy—not just the interests of those who want to make money. Civic participation, public interest civic media, and safeguards from content and services designed to manipulate us must be addressed. There is a role for the FCC in all this. (We shouldn’t throw-out as “bathwater” the potential of our broadband media to serve democracy and a role for the FCC because we are upset about it catering to zealous social conservatives who don’t like some programming).

Finally, shame on CDT for joining up with PFF. PFF is an opponent of the network neutrality policy for the Internet. It has also long opposed any meaningful role for the FCC. But, perhaps that’s the point. If PFF gets it way, its backers–and many of CDT’s–will be free to do as they please, regardless of the consequences to our democracy.

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Online Ad and Data Collection Watch

My group has launched a new project to keep the public better informed about the latest threats to our privacy. Click here to visit Online AdWatch. It will regularly highlight new developments in the interactive ad marketplace across the PC, mobile, and digital TV platforms. Send me your favorite examples of technologies, applications and market strategies that should be included.

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Yahoo!’s Deal with the Newspaper Industry: Papers should come clean about the data they will now collect/share and our privacy

We are troubled, as are many, about the crisis occurring within the U.S. daily newspaper industry. The lay-offs, cut backs, and other problems besetting such distinguished papers as the Los Angeles Times, San Jose Mercury News, Philadelphia Inquirer, and too many others, requires the attention of policy makers and civic leaders. We believe a principal cause for the current problem are publishers and newspaper holding companies whose first interest is squeezing out maximum revenue returns—for themselves and shareholders. Newspapers can make a reasonable profit and support serious journalism. But when they are seen as just another vehicle designed to generate lots of cash, the defenders of the First Amendment have been replaced by white-collar criminals. It’s time for new federal laws that would enable newspapers to be operated without regard to maximizing shareholder return.


We also know we are in a key transition period for all media. That’s why we should publicly examine all the major deals shaping our future information landscape—to determine how well they will serve the public interest [Yes. We think that’s more important than just making money from the deals]. So, when William Dean Stapleton, CEO of MediaNewsGroup, says in a joint statement that the new partnership with Yahoo! and 176 newspapers is “transformational”–it requires a closer look. Some of the biggest names in the news business—Belo, Cox, Hearst, Scripps and MediaNews—have now hitched their digital wagons to Yahoo! Papers such as the San Francisco Chronicle, San Jose Mercury News, and Dallas Morning News are now a part of what is called the “most comprehensive advertising network in the online industry.” A major facet of the deal, notes the release, is for the papers to “[U]se Yahoo!’s search monetization functionality on newspapers Web sites, such as Web search, downloads of the Yahoo! toolbar and sponsored search.”

We recognize that newspapers must boldly work to secure new digital revenues. But in doing so, they must be responsible. That includes explaining carefully to every reader and user the kind of personal and other data Yahoo! is now able to collect and financially harvest. Readers/users need to know how Yahoo! and its newspaper partners will “target” them. When Yahoo! acquired rich media ad firm AdInterax last month, they noted that “Rich media technology enables marketers to create more compelling and interactive advertising units online using sight, sound and motion to deliver a message to target consumers. Yahoo! plans to further integrate rich media capabilities into its current leading offerings by developing a self-service model for marketers based on the AdInterax platform. This new rich media solution will enable advertisers and agencies to create and run rich media campaigns coupled with other Yahoo! capabilities including behavioral targeting, geo-targeting, demo-targeting, and dayparting.” The release also noted that “the AdInterax tracking and reporting module tracks traditional metrics including impressions, clicks, and reach and frequency, in addition to other key branding and direct marketing data.”

Newspapers should be protecting the privacy of the public—from both the excesses of government as well as commercial interests. Journalistic-related companies should make deals with online marketers such as Google and Yahoo! which place the privacy interests of readers/users first. We suggest that the editors from the papers now working with Yahoo! commission stories that will explain the deal in terms of what data is being collected and how it will be used. Then, the papers should run editorials calling on Congress to pass meaningful privacy safeguards on electronic data gathering. But—if they did that—wouldn’t it now threaten the very deal they just made? We will be tracking this story.

PS: We also want to see the same privacy-related disclosure from the 50 papers now involved with Google, via a deal announced earlier this month. They include the New York Times and Washington Post.

Political Games Advertisers Play: A GOP Protection Racket

The nation’s biggest advertisers and marketers have developed an effective political operation in Washington. Madison Avenue and its clients have been able to ward off calls for policies, for example, that would protect our privacy. How the Association of National Advertisers (ANA) and the American Association of Advertising Agencies (AAAA) conduct its lobbying efforts have largely been off the radar screen. After all, the press cannot examine itself (since the ad lobby is ultimately tied to the fate and fortunes of broadcasting, cable, newspaper, and much of online).

So we thought it was worth pointing out a telling comment in a recent Advertising Age story written by its indefatigable and enterprising D.C. bureau chief Ira Teinowitz. In his story titled “What Democratic Control May Mean for Marketers” (Oct. 16, 2006), he quotes AAAA VP Dick O’Brien. A change in control, said O’Brien, would mean that “[T]he sort of protection we have had on the House Commerce Committee will disappear.”

While not a bombshell, such admissions help tell the story of how all too often, Commerce chair Joe Barton and Telecom subcommittee chair Fred Upton have worked to help the big buck special interest agenda (think Bells, cable and no network neutrality for broadband). While we don’t believe the Democrats are Saints, at least once in a while they will yell and scream. The Ad industry, in our opinion, needs to lose its protection racket defense.

Sumner Redstone: Media Mogul Hypocrite

Yesterday, Sumner Redstone gave a speech where he reportedly blasted the `climate of fear’ and self-censorship created by the federal focus on indecent TV content. At a “freedom of speech” event organized by The Media Institute, [which is really a lobbying group working on behalf of the media conglomerates] Redstone said that “Let us rise above the temptation to censor or fine or regulate the most basic and primary of our constitutional rights. Not only because it is an improper role for government, but also because it is not what Americans want from their government.”

But Redstone really isn’t a supporter of free speech. Otherwise, why would his MTV Networks just announce a deal to distribute video content over the Chinese search engine Baidu? Baidu itself engages in self-censorship to appease the Chinese government. We assume part of Redstone’s China deal includes a provision that any content deemed objectionable to the government will be quickly trashed.

We dislike the atmosphere of pressure about content coming from both parties at the FCC and many in Congress. But we don’t believe in saying we stand up for freedom of speech in one country, but turn a blind (but profitable) eye elsewhere.

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What Google-YouTube Means for the Public Interest

Here’s a new piece I wrote for The Nation magazine online that summarizes my concerns about what is happening with our digital media system–and what we should do about it.

http://www.thenation.com/doc/20061030/chester

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Inappropriate PBS Ad of the Week–about the Pope and the Devil!

PBS, abandon all sense of perspective when ye enter into commercial digital marketing contracts. Here’s a ad on the PBS.org site alongside its promotion of news and public affairs programming. “Next Pope is John Paul II Impersonated. Bible Prophecy Shows He Will be Last Pope. Learn More www.worldslastchance.com.” By clicking, you go to: [http://www.worldslastchance.com/index.php?p=next_and_last_pope.php]

There you can learn about the “world’s last chance” and that a “New World Order is About to Start.” Then a headline declares that: “The Bible Reveals next and last Pope will be a Devil impersonating John Paul II.”

No fooling! I think the fundraising drive has depleted the oxygen at PBS HQ. They better meditate now on the foolish digital ad path they trod.

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PBS is Running Stupid and Manipulative Online Ads—First in a Series

PBS is running sponsored ad “links” via its Google deal. The further commercialization of public broadcasting is a real problem. Relying on bottom-feeder interactive advertising isn’t going to address any of the sustainability issues at public TV.

So, in the spirit of public service, this column will regularly review ads on the PBS site. Our nominee today is the data collection scam targeted at moms. “Are You a Slacker Mom? 15 Fun Questions that will show you what type of mom you really are” reads the copy for the www.AreYouASlackerMom.com. Once there, you are asked a series of questions and urged to give your email address, become a “member” and “receive notices for new quizzes, games and special offers from Chatterbean.” [which operates the site]

PBS should never be part of a data grab; nor should they promote commercial ventures. But from the recent push to make PBS more ad friendly, it appears we have some slacker executives running the network.

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The Military Does MySpace

We want to point to a new article in Brandweek that illustrates how the U.S. military is relying on “sell-em” techniques to boost enlistments. Boy, with the Iraq war such a disaster (to put it charitably), what a bad “advertising environment” the marketing folks in the Pentagon have to work with. Brandweek’s Jim Edwards was able to obtain Air and Army National Guard marketing records via a Freedom of Information request. Edwards reports that “[T]he documents—which describe internal market research memos, e-mails and PowerPoint presentations—offer an inside look at how Pentagon marketers saw consumer sentiment change, and they confirm that as the war progressed, particularly around 2004, their job got harder and harder.” The Brandweek story describes how the Reserve tested “alternative positionings for its brand,” including on the themes of “Hero, Everyman, Caregiver and Explorer…”

It appears that recruiting is now up, as a result of the intensive and well-funded marketing spin. Some tidbits:

“The total Pentagon ad spend went up 10.5% in 2005, to $276 million, after news that the Army and the Marines were not meeting their goals in some months in 2005. In the first six months of 2006, that spend ballooned to $177 million, putting the Pentagon on course for $345 million spent for the full year, per Nielsen Monitor-Plus.”

“Like other marketers trying to reach a young demo, the National Guard is considering opening a MySpace page…(The Marines, by the way, have a MySpace page—which showed 22,000 “friends” last week—and have released a viral video made by JWT, New York.)”

Congrats to Edwards and his editors for entrepreneurial reporting.

Source: “How National Guard Is Fighting Attrition.” Jim Edwards. Brandweek. October 02, 2006. Subscription may be required.

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