Category: FTC

Watch Out Doing a Search Dance With This Partner-Cha Cha

Jason Pontin has a interesting story today in the New Tork Times business section about the use and misuse of people to assist computers in such tasks as searches [“Artificial Intelligence, with Help From the Humans” reg. required]. He cites Cha Cha, a company that has received investment from Jeff Bezos of Amazon.com. Cha Cha, explains Pontin, is a “human-assisted search company.” There is another part of the Cha Cha story. We think of it more as a stealth-like online advertising vehicle disguised in `Google’ search garb. While users of Cha Cha await the help of “real” people to assist them with their information searches, here’s what is really happening, courtesy of Behavioral Insider:

“Traditional search interactions take only a matter of seconds – but interactive search with guides takes on average a few minutes. During that period, as searchers are working with guides to tailor their answers, display ads can be targeted by subject matter and user interest. So imagine that someone is interested in athletic shoes. Not only do you base targeting on their keyword search but, based on the kinds of questions they’ve asked in the past, you learn what kind of athletic shoes, whether they’re a middle-aged mom interested in taking up jogging or buying a gift for their teenage son. During the guided search session you can target short, video-rich media based on what their needs and interests are.”

Interview with co-founder of “next generation search firm” ChaCha. “Beyond Keywords: New Dimensions In Search Behavior.” Phil Leggiere. Behavioral Insider. March 14, 2007.

Digital Ad Lobbyists Meet in DC: Media Powerbrokers Gather to Fight Online Privacy Rules

Yesterday, the new Interactive Advertising Bureau’s DC lobbying operation held its “inaugural” event near Capital Hill. Attendees were expected from the 40 members of the IAB “Public Policy Council,” including Google, Time Warner, Yahoo!, Microsoft, Disney, CBS, and News Corp/Fox.

The group was briefed by “two senior attorneys from the FTC Division of Advertising Practices,” according to ClickZ [Mamie Kresses and Richard Quaresima]. While the agenda included a broad range of issues, such as online taxes and network neutrality, there is no doubt that preventing any public interest policy that protects consumer privacy online is the key agenda item. Digital marketers fear that once the public learns how their privacy is threatened via the many techniques of online advertising, there will be a demand for federal safeguards. So the IAB has expanded its political operations to include the hiring of a lobbyist—former Chamber of Commerce official Mike Zaneis. They hope to keep the FTC and the Hill under their political influence—which is considerable.

The IAB is already boosting a success in having its policy chair speak at a recent Congressional hearing.

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Online Targeted Political Ads and the White House: Will the Candidates Protect our Privacy?

Yahoo!, Google, and even “adver-gaming” types are lining up to “connect candidates with potential voters,” notes a story today in the Washington Post [“Online Firms Boot Up for Political Campaigns.” reg. required]. Google and others sponsored an event organized by the George Washington University’s Institute for Politics, Democracy & the Internet.

We believe the evolution of political advertising to embrace the online mediums of broadband PC, mobile devices, and interactive television raises a series of fundamental concerns. First, candidates should not be given or collect the vast amounts of personal information about us that Yahoo!, Google, AOL and everyone else routinely collects. Candidates should not allow “cookies” to be placed on our computers which relate to their campaigns—without prior informed consent. There is a treasure trove of data that can help candidates target their messages. But we believe without informed and prior consent, the voting public is at risk in having personal and other data be used by candidates in a manipulative and unfair way.

Two, candidates require free access to all platforms. We run the risk of migrating the current “it takes big money to make a real impact” system we have with broadcasting to the digital realm. Gatekeepers—such as AT&T, Comcast, Time Warner, Google and Yahoo!—will be able to charge premium prices. We want new media to fix the problems we have with today’s system, where the requirements of having to raise vast sums of money ultimately empowers the permanent elite interest class.

The presidential campaign should be a litmus test on the candidates and personal privacy online. Reform advocates should also begin calling for “free time” to all the new online media distribution system. As the campaign progresses, this blog will not only follow the money, but the data sales as well.

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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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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).

MySpace Keeping Tabs on You

Thanks to Peter Levinsohn of Fox Interactive for–once again–helping us make the case for a national privacy policy where opt-in and full-disclosure is required from all online sites. Here’s an excerpt of a news story in Broadcasting & Cable:

Levinsohn also talked about the wealth of data MySpace collects from its users. He said that 90% of users register, which includes “an enormous amount of information,” which he said includes “age, marriage status, likes, dislikes, where you live.” He said the site then “combines that data with data we extract from the profile pages…marry it with the enormous amount of inventory we have and then target our ads more effectively.” He said he saw it as a way to dramatically increase the CPMs (cost per thousand) across the overall network.”

Source: “Fox Interactive Claims 40 Billion Page Views in January.” John Eggerton. Broadcasting & Cable. 3/7/07

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Online Alcohol Promotion in Web 2.0: A-B+Blue Lithium

Stuart Elloitt of the New York Times reports today that “Anheuser-Busch is teaming up with Blue Lithium, an online marketing company in San Jose, Calif., to introduce a promotional program called Clink as part of its “Here’s to beer” campaign. The program, to be housed on MingleNow, a social-networkingWeb site, will let members upload and share photographs as well as video clips. Anheuser-Busch also plans to add a video-sharing feature to Bud.tv…”

But those concerned about inappropriate marketing of beer and alcohol products to underage youth—as well as online privacy—should know more about the deal between A-B and Blue Lithium. It illustrates how marketing is dramatically changing as a result of digital technologies. Data collection, one-to-one targeting via new broadband platforms, and better ways to meld the consumer’s psyche with the brand (such as encouraging user-generated content to promote “engagement”) are just a handful of the new techniques.

Blue Lithium is more than just an “online marketing company” described by the Times. It provides advertisers a broad range of digital tools to deliver precision advertising and marketing, via its “ad network” of online content providers (called publishers). Blue Lithium touts the power of its technology to drive change in consumers, something called “conversions.” Advertisers using Blue Lithium can count on it “identifying the right people, based on tracking user actions and interests, then bundles those individuals up into a highly-receptive audience for your messages.” [Many other companies engage in such behavioral techniques via ad networks].

As consumers are attracted to Blue Lithium connected websites to view consumer generated video content, they will be targeted with a variety of multimedia ads. AdRoll, explains Blue Lithium, permits advertisers to “[L]ayer with advanced targeting capabilities to refine the focus of your video campaigns, reaching those consumers with certain demographic profiles…” AdRoll’s network of publishers permits advertisers to engage in “behavioral retargeting,” which means that consumers will see a refined video pitch from the same advertisers as they travel to entirely different websites. Blue Lithium notes that such retargeting “has been show to improve click-through and conversion rates by [more than] 300%.

The A-B and Blue Lithium deal involve the latter’s “MingleNow,” called an “online/offline social network.” MingleNow, launched in December, “is dedicated to connecting users to their favorite clubs and bars and the people who go there.” It’s worth checking out the various functions of MingleNow’s approach to social networking and marketing. According to its press release (Google cached for now): “MingleNow is built along three fundamental dimensions: Profiles, Places and Events. Once users indicate which bars and clubs, they frequent, their photos show up on the Place page of that establishment and they become part of the community that goes there to share photos and video, trade comments, plan events and in person meetings. MingleNow has over 900,000 place pages representing the most popular drinking, clubbing and socializing establishments in the U.S. Event pages enable users to see what’s going on in their area or publicize their own event. Profile pages give users a place to share information about themselves, feature their favorite people and places, make plans, upload video and more. In order to create an open social network, MingleNow allows users to import feeds and data from other social networks, and export feeds from MingleNow to other networks.”

In another example of techniques to engage users, MingleNow lets you “earn VIP points” as you bring others in to join it. Such rewards can be used for free drinks. We don’t know whether MingleNow is using behaviorally targeting nor the extent of its deal with A-B. But we think both companies need to be candid about what is going on.