The Federal Trade Commission has partnered with Visa and the Better Business Bureau to issue an alert warning consumers about misleading offers for "free" trial subscriptions online that can quickly -- and quietly -- turn into expensive commitments.
The FTC's Bureau of Consumer Protection Director, David Vladeck, held a press conference last week with officials from the BBB and Visa executives to call attention to offers that contain a so-called "negative option." Such offers require the consumer to opt out of a hidden agreement in order to avoid getting charged.
"Free trial marketing can be convenient for consumers -- if the terms are clearly spelled out beforehand," Vladeck said. "Legitimate marketers don't hide critical information about costs or cancellation policies to get their customers to agree to future charges."
The FTC reached a settlement in November with a company called Commerce Planet that offered consumers a "free online auction kit" that would teach them to make money selling items on sites like eBay. The FTC charged that Commerce Planet did not make it clear that by signing up to receive the auction kit, customers were also signing up for the company's $59.95 per month "Online Supplier" program if they didn't cancel within a few days of the order.
In August, the commission shut down a number of sites that were offering free help getting consumers grant money from the government. Consumers found themselves on the hook for up to $70 a month for services from health insurance plans to identity theft protection if they didn't opt out quickly.
The alert issued by the FTC included tips for protecting against such scams, including being aware of pre-checked boxes when signing up for free offers and reading the fine print of every offer closely. Visa also set up a Web site, where consumers can go for more option.
Monday, December 21, 2009
Friday, December 18, 2009
Facebook Privacy Changes Break the Law, Privacy Groups Tell FTC
A coalition of privacy groups asked regulators Thursday to investigate controversial new privacy settings on Facebook, saying recent changes in how the massive social networking site treats customer data violate federal consumer protection laws.
The complaint, filed by the Electronic Privacy Information Center (EPIC), says the changes significantly cut back customer privacy controls by forcing into the public eye certain information that they could previously restrict. Under the new policy, a user’s profile picture, current city, gender and friend and fan page lists are automatically public for all users, with little option to limit who is able to see this information. Additionally, Facebook set more defaults to its public setting, hoping users will start sharing information, such as their status updates, with the entire internet rather than limited sets of hand selected family members or friends — a clear effort to compete with Twitter by serving more real time customer data.
The changes “violate user expectations, diminish user privacy, and contradict. Facebook’s own representations,” EPIC charges (.pdf). The complaint asks the Federal Trade Commission to “determine the extent of the harm to consumer privacy and safety, require Facebook to restore privacy settings that were previously available…, require Facebook to give users meaningful control over personal information, and seek appropriate injunctive and compensatory relief.”
The challenge raises the stakes for Facebook, the world’s largest social-networking site, which has been trying to ride out a vocal backlash against what some see as a blatant attempt to push users into sharing publicly and often. It will also serve as a test case for the FTC under the Obama Administration, forcing the agency to show whether it will remain focused on scams with provable harms, or become a more interventionist player in the market as the FCC has become with telecommunications companies.
EPIC was joined in its complaint by a coalition of interest groups, including the Center for Digital Democracy, the American Library Association and the Privacy Rights Clearinghouse.
EPIC’s director Marc Rotenberg described the complaint as the most significant one facing the FTC, which is now headed by Jon Leibowitz. He is considered to be more sympathetic to privacy issues, and the FTC just signaled as much by holding a series of open-ended privacy hearings earlier this month.
“More than 100 million people in the United States subscribe to the Facebook service,” Rotenberg said. “The company should not be allowed to turn down the privacy dial on so many American consumers.”
But Facebook spokesman Andrew Noyes says the company discussed the changes with the FTC, privacy groups and the public ahead of time.
“We’ve had productive discussions with dozens of organizations around the world about the recent changes and we¹re disappointed that EPIC has chosen to share their concerns with the FTC while refusing to talk to us about them,” said Noyes, a longtime DC tech policy reporter who joined Facebook this fall. “The new tools offer users the opportunity to decide on privacy with every photo, link or status update they wish to post, so the process of personalizing privacy on Facebook will continue.”
The complaint comes just a day after privacy groups had a behind-the-scenes briefing with Facebook lawyers. Those included Tim Sparapani, who joined Facebook in the spring after working for several years as the ACLU’s top lobbyist battling government spying bills.
In the presentation, Facebook told the groups that as of Monday 220 million users had used its privacy settings transition wizard. Of those, about 40 percent are changing the defaults settings, while about 50 percent are opting to stick with Facebook’s new, more public default choices.
The Center for Digital Democracy’s Jeff Chester called Facebook’s definition of privacy “self-serving and narrow” and that the company’s intention is to get users to share as much as possible, in part to allow for more targeted advertising.
“They don’t disclose that consumer data is being used for very sophisticated marketing and targeting,” Chester said. “The Obama administration will have to be the cop on the beat.”
While the Electronic Frontier Foundation did not sign onto the complaint, EFF lawyer Kevin Bankston described his group’s concerns as similar.
“The complaint raises important questions about Facebook’s privacy practices that echo EFF’s own concerns, and I expect that the FTC will seriously consider opening an investigation,” Bankston said.
Bankston wrote an influential critique of the changes last week, but his concerns were largely dismissed by a Facebook spokesman who called Bankston part of a tiny minority who used a feature blocking third-party developers from accessing any of their data when a friend installs an application.
But Bankston is hardly alone in his criticism.
Facebook’s own posts on the privacy changes have more than 2,000 comments, most negative. Meanwhile, purely grassroots protest groups such as “Against The New Facebook Privacy Settings!” and “Facebook! Fix the Privacy Settings” have formed inside Facebook, demanding that Facebook roll back the changes.
While the FTC is a complaint-driven agency, it does not disclose when or if it opens investigations. A previous FTC complaint by EPIC regarding the data marketing industry led to record fines.
A Facebook spokesman did not return a call seeking comment by press time
The complaint, filed by the Electronic Privacy Information Center (EPIC), says the changes significantly cut back customer privacy controls by forcing into the public eye certain information that they could previously restrict. Under the new policy, a user’s profile picture, current city, gender and friend and fan page lists are automatically public for all users, with little option to limit who is able to see this information. Additionally, Facebook set more defaults to its public setting, hoping users will start sharing information, such as their status updates, with the entire internet rather than limited sets of hand selected family members or friends — a clear effort to compete with Twitter by serving more real time customer data.
The changes “violate user expectations, diminish user privacy, and contradict. Facebook’s own representations,” EPIC charges (.pdf). The complaint asks the Federal Trade Commission to “determine the extent of the harm to consumer privacy and safety, require Facebook to restore privacy settings that were previously available…, require Facebook to give users meaningful control over personal information, and seek appropriate injunctive and compensatory relief.”
The challenge raises the stakes for Facebook, the world’s largest social-networking site, which has been trying to ride out a vocal backlash against what some see as a blatant attempt to push users into sharing publicly and often. It will also serve as a test case for the FTC under the Obama Administration, forcing the agency to show whether it will remain focused on scams with provable harms, or become a more interventionist player in the market as the FCC has become with telecommunications companies.
EPIC was joined in its complaint by a coalition of interest groups, including the Center for Digital Democracy, the American Library Association and the Privacy Rights Clearinghouse.
EPIC’s director Marc Rotenberg described the complaint as the most significant one facing the FTC, which is now headed by Jon Leibowitz. He is considered to be more sympathetic to privacy issues, and the FTC just signaled as much by holding a series of open-ended privacy hearings earlier this month.
“More than 100 million people in the United States subscribe to the Facebook service,” Rotenberg said. “The company should not be allowed to turn down the privacy dial on so many American consumers.”
But Facebook spokesman Andrew Noyes says the company discussed the changes with the FTC, privacy groups and the public ahead of time.
“We’ve had productive discussions with dozens of organizations around the world about the recent changes and we¹re disappointed that EPIC has chosen to share their concerns with the FTC while refusing to talk to us about them,” said Noyes, a longtime DC tech policy reporter who joined Facebook this fall. “The new tools offer users the opportunity to decide on privacy with every photo, link or status update they wish to post, so the process of personalizing privacy on Facebook will continue.”
The complaint comes just a day after privacy groups had a behind-the-scenes briefing with Facebook lawyers. Those included Tim Sparapani, who joined Facebook in the spring after working for several years as the ACLU’s top lobbyist battling government spying bills.
In the presentation, Facebook told the groups that as of Monday 220 million users had used its privacy settings transition wizard. Of those, about 40 percent are changing the defaults settings, while about 50 percent are opting to stick with Facebook’s new, more public default choices.
The Center for Digital Democracy’s Jeff Chester called Facebook’s definition of privacy “self-serving and narrow” and that the company’s intention is to get users to share as much as possible, in part to allow for more targeted advertising.
“They don’t disclose that consumer data is being used for very sophisticated marketing and targeting,” Chester said. “The Obama administration will have to be the cop on the beat.”
While the Electronic Frontier Foundation did not sign onto the complaint, EFF lawyer Kevin Bankston described his group’s concerns as similar.
“The complaint raises important questions about Facebook’s privacy practices that echo EFF’s own concerns, and I expect that the FTC will seriously consider opening an investigation,” Bankston said.
Bankston wrote an influential critique of the changes last week, but his concerns were largely dismissed by a Facebook spokesman who called Bankston part of a tiny minority who used a feature blocking third-party developers from accessing any of their data when a friend installs an application.
But Bankston is hardly alone in his criticism.
Facebook’s own posts on the privacy changes have more than 2,000 comments, most negative. Meanwhile, purely grassroots protest groups such as “Against The New Facebook Privacy Settings!” and “Facebook! Fix the Privacy Settings” have formed inside Facebook, demanding that Facebook roll back the changes.
While the FTC is a complaint-driven agency, it does not disclose when or if it opens investigations. A previous FTC complaint by EPIC regarding the data marketing industry led to record fines.
A Facebook spokesman did not return a call seeking comment by press time
Privacy Groups To FTC: 'We Want Old Facebook Settings Back'
Consumer advocates have asked the Federal Trade Commission to order Facebook to bring back its former privacy settings.
In a complaint filed Thursday, the Electronic Privacy Information Center and nine other groups allege that Facebook's controversial new privacy settings "violate user expectations, diminish user privacy, and contradict Facebook's own representations." The advocacy organizations, including The Center for Digital Democracy, Consumer Federation of America and the American Library Association, say that Facebook's change in terms are a deceptive and unfair business practice.
"We fully respect that some people want to be fully public, which is fine, but other people need gradations of privacy and Facebook has made it more difficult for people who need those gradations to keep them," said Marc Rotenberg, executive director of the EPIC.
Last week, Facebook unveiled new privacy settings that for the first time, classify a host of data as "publicly available information." Included in that category are users' names, profile pictures, cities, networks, lists of friends and pages people are fans of.
Facebook users can still avoid displaying their friends lists, but the controls to do so are no longer located with the other privacy settings. Instead, people who want to keep the names of their friends from appearing must go to the profile section, click on an icon next to their friend list, and uncheck the "show my friends on my profile" box.
Even when Facebook users complete that procedure, application developers nonetheless have access to all "publicly available information" about users.
Privacy advocates say these changes potentially harm people because information about their friends can be used for questionable purposes. For instance, the complaint references MIT's "gaydar" research, which involved figuring out who was gay based on their Facebook friends.
Another area of contention involves the default settings. When Facebook rolled out its revised privacy controls, it asked members to review their settings, but also changed most defaults to share-with-everyone. The upshot was that some members who previously restricted access to their pictures, status updates and other information are now giving all Web users access to it.
Rotenberg says this shift wasn't fair to Facebook's members. "It's a little bit like opting out of a list, and then having the company opt you back in and saying, 'Well you can just opt out again,'" he says.
Privacy advocate Jeff Chester, executive director of The Center for Digital Democracy, says he's particularly troubled by Facebook's share-everything default standard. "Facebook is boldly redefining the concept of privacy for all Americans," he said. "Facebook is consciously devaluing the notion of privacy for its own interests."
A Facebook spokesperson said the company met with outside parties, including the FTC, before revising its privacy settings. "We've had productive discussions with dozens of organizations around the world about the recent changes and we're disappointed that EPIC has chosen to share their concerns with the FTC while refusing to talk to us about them," a spokesperson said.
Rotenberg said that his organization met with Facebook on Wednesday for over an hour. "I walked out of the meeting and concluded that they didn't understand," Rotenberg said.
In a complaint filed Thursday, the Electronic Privacy Information Center and nine other groups allege that Facebook's controversial new privacy settings "violate user expectations, diminish user privacy, and contradict Facebook's own representations." The advocacy organizations, including The Center for Digital Democracy, Consumer Federation of America and the American Library Association, say that Facebook's change in terms are a deceptive and unfair business practice.
"We fully respect that some people want to be fully public, which is fine, but other people need gradations of privacy and Facebook has made it more difficult for people who need those gradations to keep them," said Marc Rotenberg, executive director of the EPIC.
Last week, Facebook unveiled new privacy settings that for the first time, classify a host of data as "publicly available information." Included in that category are users' names, profile pictures, cities, networks, lists of friends and pages people are fans of.
Facebook users can still avoid displaying their friends lists, but the controls to do so are no longer located with the other privacy settings. Instead, people who want to keep the names of their friends from appearing must go to the profile section, click on an icon next to their friend list, and uncheck the "show my friends on my profile" box.
Even when Facebook users complete that procedure, application developers nonetheless have access to all "publicly available information" about users.
Privacy advocates say these changes potentially harm people because information about their friends can be used for questionable purposes. For instance, the complaint references MIT's "gaydar" research, which involved figuring out who was gay based on their Facebook friends.
Another area of contention involves the default settings. When Facebook rolled out its revised privacy controls, it asked members to review their settings, but also changed most defaults to share-with-everyone. The upshot was that some members who previously restricted access to their pictures, status updates and other information are now giving all Web users access to it.
Rotenberg says this shift wasn't fair to Facebook's members. "It's a little bit like opting out of a list, and then having the company opt you back in and saying, 'Well you can just opt out again,'" he says.
Privacy advocate Jeff Chester, executive director of The Center for Digital Democracy, says he's particularly troubled by Facebook's share-everything default standard. "Facebook is boldly redefining the concept of privacy for all Americans," he said. "Facebook is consciously devaluing the notion of privacy for its own interests."
A Facebook spokesperson said the company met with outside parties, including the FTC, before revising its privacy settings. "We've had productive discussions with dozens of organizations around the world about the recent changes and we're disappointed that EPIC has chosen to share their concerns with the FTC while refusing to talk to us about them," a spokesperson said.
Rotenberg said that his organization met with Facebook on Wednesday for over an hour. "I walked out of the meeting and concluded that they didn't understand," Rotenberg said.
Thursday, December 17, 2009
AGs urge FTC to require stricter advertising disclosures
WASHINGTON (Legal Newsline)-The Federal Trade Commission needs to do more to strengthen consumer protections to prevent deceptive marketing of so-called free credit reports, 42 state attorneys general said in a letter to regulators.
While the bipartisan group of attorneys general said they support several of the changes proposed by the FTC, they would like to see regulators adopt more stringent disclosures.
"We believe that advertising restrictions and mandatory disclosures are necessary to ensure that consumers are not misled or confused by advertisements and offers for 'free' credit reports and are able to easily obtain their free annual credit reports," the letter sent this week said.
Federal law allows consumers to obtain one free credit report from each of the three major bureaus: Equifax, TransUnion and Experian. Consumers may request a report at www.annualcreditreport.com or by calling 1-877-322-8228.
But there are sound-alike Web sites where consumers can be misled, the attorneys general said in their Dec. 7 letter. They point out www.freecreditreport.com, which is owned by Experian, as an example.
"Consumers file complaints stating they did not understand that by accessing their free credit report, they had signed up for a service that automatically charged a specific amount per month for credit monitoring," the attorneys general wrote.
The Federal Trade Commission is proposing that television and radio commercials for "free" credit reports must disclose: "This is not the free credit report provided for by federal law."
The states, however, want advertisers to go a step further, and include the statement: "This report is only free if you make a purchase."
Print and Web ads would require similar disclosures and list the phone number and Web site for requesting the government-mandated free reports.
The attorneys general and the FTC also want to ban hyperlinks to commercial Web sites from www.annualcreditreport.com and prohibit marketing for paid services or products until after a consumer has received the free credit report.
Washington Attorney General is among the letter's 43 signatories. He said in a statement that more needs to be done to protect consumers.
"Credit reports are crucial in helping consumers detect whether they've become victims of identity theft or credit fraud," McKenna said. "Credit reporting agencies are required to provide you a free copy of your report, but some see this as an opportunity to sell additional products. Under the law, 'free' means 'at no cost,' not 'free with a purchase.'"
The AGs' letter was sent by the National Association of Attorneys General, of which McKenna, a Republican, is the vice president.
Signatories on the letter in addition to McKenna were the attorneys general of: Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Guam, Hawaii, Idaho, Illinois, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont and West Virginia
While the bipartisan group of attorneys general said they support several of the changes proposed by the FTC, they would like to see regulators adopt more stringent disclosures.
"We believe that advertising restrictions and mandatory disclosures are necessary to ensure that consumers are not misled or confused by advertisements and offers for 'free' credit reports and are able to easily obtain their free annual credit reports," the letter sent this week said.
Federal law allows consumers to obtain one free credit report from each of the three major bureaus: Equifax, TransUnion and Experian. Consumers may request a report at www.annualcreditreport.com or by calling 1-877-322-8228.
But there are sound-alike Web sites where consumers can be misled, the attorneys general said in their Dec. 7 letter. They point out www.freecreditreport.com, which is owned by Experian, as an example.
"Consumers file complaints stating they did not understand that by accessing their free credit report, they had signed up for a service that automatically charged a specific amount per month for credit monitoring," the attorneys general wrote.
The Federal Trade Commission is proposing that television and radio commercials for "free" credit reports must disclose: "This is not the free credit report provided for by federal law."
The states, however, want advertisers to go a step further, and include the statement: "This report is only free if you make a purchase."
Print and Web ads would require similar disclosures and list the phone number and Web site for requesting the government-mandated free reports.
The attorneys general and the FTC also want to ban hyperlinks to commercial Web sites from www.annualcreditreport.com and prohibit marketing for paid services or products until after a consumer has received the free credit report.
Washington Attorney General is among the letter's 43 signatories. He said in a statement that more needs to be done to protect consumers.
"Credit reports are crucial in helping consumers detect whether they've become victims of identity theft or credit fraud," McKenna said. "Credit reporting agencies are required to provide you a free copy of your report, but some see this as an opportunity to sell additional products. Under the law, 'free' means 'at no cost,' not 'free with a purchase.'"
The AGs' letter was sent by the National Association of Attorneys General, of which McKenna, a Republican, is the vice president.
Signatories on the letter in addition to McKenna were the attorneys general of: Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Guam, Hawaii, Idaho, Illinois, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont and West Virginia
Government Working Group Recommends Nutritional Marketing Standards
Guidelines would prevent marketing of some foods to children
By John Eggerton -- Broadcasting & Cable, 12/16/2009 11:11:21 AM
According to new proposed government guidelines, cereals with more than 13 grams of added sugar could not be marketed to kids and food that could be marketed to children would have to contain at least 50% of one or more of the following: fruit, vegetable, whole grain, fat-free or low-fat milk or yogurt, fish, extra lean meat or poultry, eggs, nuts and seeds, or beans
As expected, an interagency group comprising representatives of the FTC, Food and Drug Administration, Centers for Disease Control and Prevention, and the U.S. Department of Agriculture, submitted recommendations on new nutrition guidelines for marketing food to kids.
That announcement came late Tuesday following an FTC hearing on food marketing to kids.
Exempt from any restrictions on marketing would be fruits, vegetables, juices, non-or low-fat milk, yogurt, whole grains and water.
The working group still has to decide what media the guidelines should apply to and must give the public an opportunity to comment. The group must produce a final report for Congress by July 15, 2010.
By John Eggerton -- Broadcasting & Cable, 12/16/2009 11:11:21 AM
According to new proposed government guidelines, cereals with more than 13 grams of added sugar could not be marketed to kids and food that could be marketed to children would have to contain at least 50% of one or more of the following: fruit, vegetable, whole grain, fat-free or low-fat milk or yogurt, fish, extra lean meat or poultry, eggs, nuts and seeds, or beans
As expected, an interagency group comprising representatives of the FTC, Food and Drug Administration, Centers for Disease Control and Prevention, and the U.S. Department of Agriculture, submitted recommendations on new nutrition guidelines for marketing food to kids.
That announcement came late Tuesday following an FTC hearing on food marketing to kids.
Exempt from any restrictions on marketing would be fruits, vegetables, juices, non-or low-fat milk, yogurt, whole grains and water.
The working group still has to decide what media the guidelines should apply to and must give the public an opportunity to comment. The group must produce a final report for Congress by July 15, 2010.
Federal Group Proposes Curbs on Marketing Food to Kids
WASHINGTON -- A working group made up of officials from several federal regulatory agencies Tuesday proposed restricting marketing of foods and beverages that contain significant amounts of sugar, sodium and saturated fat, in response to concerns about childhood obesity.
Food marketing to children should be limited to foods that provide a "meaningful contribution to a healthful diet," the proposals say.
The recommendations of the group, which was created by Congress, reflect concerns that current marketing practices are influencing children's eating habits.
Federal Trade Commission Chairman Jon Leibowitz and public health advocates have expressed concern that the food industry isn't doing enough to limit the marketing of unhealthy foods to children.
David C. Vladeck, director of the FTC's consumer protection bureau, stressed that the proposals aren't regulations and aren't binding.
Still, he said companies should pay attention because if they don't take the lead on changing food marketing practices, "Congress may decide for all of us."
The recommendations will be sent to Congress next year, after a public comment period.
The Grocery Manufacturers Association, which represents makers of packaged foods, said its members have voluntarily reduced the number of advertisements aimed at children while increasingly shifting the advertising aimed at them to more healthful products.
"GMA and its members have a longstanding commitment to help arrest and reverse obesity trends around the world," Mary Sophos, GMA's senior vice president and chief government affairs officer, said in a statement. "Our efforts are having an impact and we will continue to do our part."
The foods and beverages that could be affected if the proposed marketing restrictions became law include most sodas, candies, cookies, cereals and some types of yogurt, said Margo Wootan, director of nutrition policy at the Center for Science in the Public Interest.
Dan Jaffe, a government relations official from the Association of National Advertisers, said the standards, if adopted, would be complicated to follow. The proposals "will affect a lot of our members and will have a broad impact on the advertising community," he said.
The group that made the recommendations includes officials from the FTC, the U.S. Food and Drug Administration and the Centers for Disease Control and Prevention.
Before the recommendations were announced, Mr. Leibowitz, the FTC chairman, praised the more than 16 companies, including McDonald's Corp., Burger King Holdings Inc. and General Mills Inc., that have pledged to shift food ads aimed at children to include healthier foods.
He criticized other companies that heavily market foods to children but haven't signed similar pledges.
Elaine Kolish, director of the Children's Food and Beverage Advertising Initiative at the Council of Better Business Bureaus, said industry self-regulation is working.
"The companies have done exactly what they've pledged to do, and more. The goal post may be moving, and I recognize this," she said.
—Ilan Brat contributed to this article.
Food marketing to children should be limited to foods that provide a "meaningful contribution to a healthful diet," the proposals say.
The recommendations of the group, which was created by Congress, reflect concerns that current marketing practices are influencing children's eating habits.
Federal Trade Commission Chairman Jon Leibowitz and public health advocates have expressed concern that the food industry isn't doing enough to limit the marketing of unhealthy foods to children.
David C. Vladeck, director of the FTC's consumer protection bureau, stressed that the proposals aren't regulations and aren't binding.
Still, he said companies should pay attention because if they don't take the lead on changing food marketing practices, "Congress may decide for all of us."
The recommendations will be sent to Congress next year, after a public comment period.
The Grocery Manufacturers Association, which represents makers of packaged foods, said its members have voluntarily reduced the number of advertisements aimed at children while increasingly shifting the advertising aimed at them to more healthful products.
"GMA and its members have a longstanding commitment to help arrest and reverse obesity trends around the world," Mary Sophos, GMA's senior vice president and chief government affairs officer, said in a statement. "Our efforts are having an impact and we will continue to do our part."
The foods and beverages that could be affected if the proposed marketing restrictions became law include most sodas, candies, cookies, cereals and some types of yogurt, said Margo Wootan, director of nutrition policy at the Center for Science in the Public Interest.
Dan Jaffe, a government relations official from the Association of National Advertisers, said the standards, if adopted, would be complicated to follow. The proposals "will affect a lot of our members and will have a broad impact on the advertising community," he said.
The group that made the recommendations includes officials from the FTC, the U.S. Food and Drug Administration and the Centers for Disease Control and Prevention.
Before the recommendations were announced, Mr. Leibowitz, the FTC chairman, praised the more than 16 companies, including McDonald's Corp., Burger King Holdings Inc. and General Mills Inc., that have pledged to shift food ads aimed at children to include healthier foods.
He criticized other companies that heavily market foods to children but haven't signed similar pledges.
Elaine Kolish, director of the Children's Food and Beverage Advertising Initiative at the Council of Better Business Bureaus, said industry self-regulation is working.
"The companies have done exactly what they've pledged to do, and more. The goal post may be moving, and I recognize this," she said.
—Ilan Brat contributed to this article.
FTC Sues Intel Corp. For Creating Jobs ( I mean For Monolopy)
FTC Sues Intel Corp. For Monopoly Abuse – Intel Corp. is being sued by the government.The U.S. Federal Trade Commission has announced earlier today that they are suing Intel for “anticompetitive tactics”.FTC officials said:
Intel not only used improper tactics against Advanced Micro Devices Inc.—its longtime competitor in microprocessors—but add allegations that Intel improperly quashed competition from Nvidia Corp. in graphics processing units, or GPUs. Those chips control three-dimensional images in computer games as well as display video on computers, and are increasingly seen an alternative to microprocessors.
See the FTC Press Release
Intel not only used improper tactics against Advanced Micro Devices Inc.—its longtime competitor in microprocessors—but add allegations that Intel improperly quashed competition from Nvidia Corp. in graphics processing units, or GPUs. Those chips control three-dimensional images in computer games as well as display video on computers, and are increasingly seen an alternative to microprocessors.
See the FTC Press Release
Friday, December 11, 2009
Thursday, December 10, 2009
Report: Web Application Security Trends Report
Read the full report: Web Application Security Trends Report
Court Ruling Could Point To Hole In Google's PPC Ad Trademark Infringement Policy
Does a loophole exist in Google and in U.S. trademark policies? In one instance, the company Experian Information Solutions bought a variety of phrases containing two keywords trademarked by its competitor Fair Isaac Corporation. Experian didn't use the words in paid ads, but to drive search traffic to its PPC ads instead. Fair Isaac then sued Experian for trademark infringement, but the judge ruled in favor of the defendant, noting that in order to prove infringement Fair Isaac would have had to show that consumers were confused about the ad they clicked on.
It appears Google's policy may suggest companies can bid on, but not insert keywords in a paid click ad for competitive reasons, unless the two companies have a direct relationship. Since evidence of consumer confusion is what's needed to prove trademark infringement in a court of law, it's unlikely that could happen if the words didn't actually appear in the ad, argue two White & Case attorneys working for Experian.
The legal landscape in the United States remains unsettled, so companies shouldn't feel free to purchase competitors' trademark keywords and use them in ads, according to White & Case Attorney Christopher Glancy. "The fact of the matter is someone could still file a trademark suit and survive a motion to dismiss simply based on the purchase of the keywords, but this case does suggest the direction the law is moving," he says. "There ought to be a clean rule that says the purchase of a keyword, alone, is not trademark infringement, as the European Court Justice seems to deem."
The Advocate General of the European Court of Justice issued an opinion in September that keyword advertising is not trademark infringement under European Law, Glancy explains.
The Court of Justice has yet to rule on it, but the Advocate General's opinion submitted to the court suggests keyword advertising is no longer a trademark infringement and that the European Union will adopt this new policy, Glancy says. "This case may signal a similar direction in the United States," he says. "We now have three published decisions that have found no infringement [from] the mere purchase of the keyword."
As for Google, in the United States the search engine doesn't monitor the use of trademarked terms as keywords, according to a source. The source goes on to explain that Google does allow some ads to serve up with a trademark keyword in the ad text if the ad is from a reseller or from an informational site. (You can find the policy here.)
If further investigation finds the advertiser uses the trademark in the ad text as a competitive weapon, using it critically or negatively, Google will require the advertiser to remove the trademark and prevent them from using it in similar ad text in the future.
White & Case Attorney Jack Pace explains Experian began purchasing variations of the keywords Fair Isaac and FICO in 2002. Ads, which did not contain the words, ran on Google, Yahoo, MSN and Ask search engines. In 2005, the company curtailed its PPC campaign substantially, limiting the number of keywords it purchased. Experian continued to purchase a few keywords until mid-2007, but stopped because Fair Isaac had initiated the lawsuit.
The significance in the Experian District Court trial, which concluded on Nov. 20, suggests a growing understanding that keyword advertising, alone, does not likely cause consumer confusion. There must be something more. The U.S. District Judge issued a ruling on the keyword-advertising claim Nov. 25. The litigation, ranging from keyword trademark infringement, to antitrust claims, ran for about three years.
It appears Google's policy may suggest companies can bid on, but not insert keywords in a paid click ad for competitive reasons, unless the two companies have a direct relationship. Since evidence of consumer confusion is what's needed to prove trademark infringement in a court of law, it's unlikely that could happen if the words didn't actually appear in the ad, argue two White & Case attorneys working for Experian.
The legal landscape in the United States remains unsettled, so companies shouldn't feel free to purchase competitors' trademark keywords and use them in ads, according to White & Case Attorney Christopher Glancy. "The fact of the matter is someone could still file a trademark suit and survive a motion to dismiss simply based on the purchase of the keywords, but this case does suggest the direction the law is moving," he says. "There ought to be a clean rule that says the purchase of a keyword, alone, is not trademark infringement, as the European Court Justice seems to deem."
The Advocate General of the European Court of Justice issued an opinion in September that keyword advertising is not trademark infringement under European Law, Glancy explains.
The Court of Justice has yet to rule on it, but the Advocate General's opinion submitted to the court suggests keyword advertising is no longer a trademark infringement and that the European Union will adopt this new policy, Glancy says. "This case may signal a similar direction in the United States," he says. "We now have three published decisions that have found no infringement [from] the mere purchase of the keyword."
As for Google, in the United States the search engine doesn't monitor the use of trademarked terms as keywords, according to a source. The source goes on to explain that Google does allow some ads to serve up with a trademark keyword in the ad text if the ad is from a reseller or from an informational site. (You can find the policy here.)
If further investigation finds the advertiser uses the trademark in the ad text as a competitive weapon, using it critically or negatively, Google will require the advertiser to remove the trademark and prevent them from using it in similar ad text in the future.
White & Case Attorney Jack Pace explains Experian began purchasing variations of the keywords Fair Isaac and FICO in 2002. Ads, which did not contain the words, ran on Google, Yahoo, MSN and Ask search engines. In 2005, the company curtailed its PPC campaign substantially, limiting the number of keywords it purchased. Experian continued to purchase a few keywords until mid-2007, but stopped because Fair Isaac had initiated the lawsuit.
The significance in the Experian District Court trial, which concluded on Nov. 20, suggests a growing understanding that keyword advertising, alone, does not likely cause consumer confusion. There must be something more. The U.S. District Judge issued a ruling on the keyword-advertising claim Nov. 25. The litigation, ranging from keyword trademark infringement, to antitrust claims, ran for about three years.
Tuesday, December 8, 2009
Yahoo! Prices Member Privacy at $60, Army Advancing Armor Research
West Palm Beach, FL (AHN) - For some, it is a comfort to know that Yahoo will work with law enforcement if necessary to catch criminals, rifling through their private messages to get the job done. However, the cost for such an invasion -- $60.
For $20, Yahoo will turn over to authorities basic user ID information. Between $30 and $40, they will give contents of subscriber accounts, including e-mail. And for $60, authorities can obtain access to all the contents to an account, including logs of Yahoo Groups.
But Yahoo is not the only company cooperating with authorities in this manner. In 2008, government officials made 8 million requests for to Sprint to turn over GPS information.
Matthew Sullivan, Sprint Nextel, in a letter to All Headline News explains that figure:
"The '8 million' figure does not represent the number of customers whose location information was provided to law enforcement, nor does it represent the instances or cases in which law enforcement contacted Sprint seeking customer location information.
Instead, the figure represents the number of individual automated requests, or "pings", for specific location information, made to the Sprint network as part of a series of law enforcement investigations and public safety assistance requests during the past year.
The critical point is that a single case or investigation may generate thousands of individual requests to the network as the law enforcement or public safety agency attempts to track or locate an individual over the course of days or weeks.
As a result, the 8 million automated requests or pings were generated by thousands (not millions) of instances in which law enforcement or public safety agencies sought customer location information.
Several thousand instances over the course of a year should not be shocking given that Sprint has more than 47 million customers and requests from law enforcement and public safety agencies are due to a variety of circumstances: exigent or emergency situations (missing person cases), criminal investigations, or cases where a Sprint customer consents to sharing location information (car is stolen and owner realizes his phone is in the car so he allows law enforcement to track his phone).
In all cases Sprint requires a valid legal request appropriate for the circumstances, meaning the request must be accompanied by either a subpoena, court order or customer consent. In all cases, Sprint complies with applicable state and federal laws."
For $20, Yahoo will turn over to authorities basic user ID information. Between $30 and $40, they will give contents of subscriber accounts, including e-mail. And for $60, authorities can obtain access to all the contents to an account, including logs of Yahoo Groups.
But Yahoo is not the only company cooperating with authorities in this manner. In 2008, government officials made 8 million requests for to Sprint to turn over GPS information.
Matthew Sullivan, Sprint Nextel, in a letter to All Headline News explains that figure:
"The '8 million' figure does not represent the number of customers whose location information was provided to law enforcement, nor does it represent the instances or cases in which law enforcement contacted Sprint seeking customer location information.
Instead, the figure represents the number of individual automated requests, or "pings", for specific location information, made to the Sprint network as part of a series of law enforcement investigations and public safety assistance requests during the past year.
The critical point is that a single case or investigation may generate thousands of individual requests to the network as the law enforcement or public safety agency attempts to track or locate an individual over the course of days or weeks.
As a result, the 8 million automated requests or pings were generated by thousands (not millions) of instances in which law enforcement or public safety agencies sought customer location information.
Several thousand instances over the course of a year should not be shocking given that Sprint has more than 47 million customers and requests from law enforcement and public safety agencies are due to a variety of circumstances: exigent or emergency situations (missing person cases), criminal investigations, or cases where a Sprint customer consents to sharing location information (car is stolen and owner realizes his phone is in the car so he allows law enforcement to track his phone).
In all cases Sprint requires a valid legal request appropriate for the circumstances, meaning the request must be accompanied by either a subpoena, court order or customer consent. In all cases, Sprint complies with applicable state and federal laws."
Monday, December 7, 2009
One-Third May Be Open To Behavioral Tracking
Nearly a third (32%) of Americans say they would be open to having their Web-surfing and television viewing habits monitored in order to receive ads more relevant to their interests -- as long as the data collected could not identify them as individuals, according to a global study of consumer media habits and advertising attitudes conducted by market research firm Synovate.
Another 8% said they would be open to such monitoring with "few, if any, concerns."
However, 35% said they would reject such technology because they would be concerned about monitoring services collecting data about them, and 9% said that they are not interested in changing the ads to which they are exposed.
On a worldwide basis, 11% expressed acceptance with few or no concerns, 26% indicated openness if individual identities were protected, 27% indicated rejection on the basis of privacy concerns, and 16% said they are not interested in changing the ads to which they are exposed.
The survey was conducted in September among consumers in the U.S. and 10 other countries. The U.S. survey took place online, and the 500 respondents comprised a representative national sample, according to Synovate.
The results confirm that consumers are taking steps to avoid advertising, and that this behavior varies by medium. For instance, 41% report that they are avoiding Web sites with intrusive ads or pop-ups more frequently than they did a year ago (9% are doing this less frequently, and 37% have not changed the frequency of this behavior). Even more (44%) are more frequently skipping ads when watching TV or listening to radio (5% are doing this less frequently, and 46% have not changed this behavior).
Here's a summary of U.S. consumer responses when asked about their frequency of engaging with brands/advertising via the Internet and social media during the past year:
But according to this survey -- remembering that it was conducted online -- Americans are even more attached to the Internet: 58% said they can't live without it, and 31% said they'd miss it a great deal if it wasn't there. Just 10% said they like it but don't need it, and 1% that they could easily live without it.
More than one-third (35%) said they can't live without their mobile phones, and another 28% would greatly miss them.
In comparison, 25% of Americans said they would greatly miss newspapers, and 10% that they can't live without them, while 23% and 6%, respectively, expressed those opinions about magazines.
Looking at perceptions about the amount of advertising in various media, 71% of Americans said there are too many ads on TV -- although 26% actually said that the number is about right, and 1% would be "happier to see or hear more ads."
Print media came out more favorably. Just 30% and 54% said that there are too many ads in newspapers and magazines, respectively, while 61% and 40% said that the number of ads is just right in newspapers and magazines, respectively. Four percent would like to see more ads in newspapers, and 2% would like to see more in magazines.
As for the new advertising frontier of mobile phones, 39% feel that the current number of ads is about right, versus 28% who already view advertising as too intrusive. Nearly a third (31%) were undecided.
How many would be willing to be exposed to more ads if they were paid for it? For both TV and the Internet, more than half (52%) said they would agree to be exposed to more ads, while 40% would not be willing. Slightly more - 54% -- would be willing to view more ads on their cell phones if they were paid to do so, although 31% said they would not be willing.
Looking at ad content, novelty appears to be more important than perkiness to U.S. consumers. Asked what characteristics their favorite ads tend to have in common, 21% chose "innovative/unique," 17% chose "spontaneous/playful," 15% chose "logical/straightforward," and 12% "optimistic/happy."
Another 8% said they would be open to such monitoring with "few, if any, concerns."
However, 35% said they would reject such technology because they would be concerned about monitoring services collecting data about them, and 9% said that they are not interested in changing the ads to which they are exposed.
On a worldwide basis, 11% expressed acceptance with few or no concerns, 26% indicated openness if individual identities were protected, 27% indicated rejection on the basis of privacy concerns, and 16% said they are not interested in changing the ads to which they are exposed.
The survey was conducted in September among consumers in the U.S. and 10 other countries. The U.S. survey took place online, and the 500 respondents comprised a representative national sample, according to Synovate.
The results confirm that consumers are taking steps to avoid advertising, and that this behavior varies by medium. For instance, 41% report that they are avoiding Web sites with intrusive ads or pop-ups more frequently than they did a year ago (9% are doing this less frequently, and 37% have not changed the frequency of this behavior). Even more (44%) are more frequently skipping ads when watching TV or listening to radio (5% are doing this less frequently, and 46% have not changed this behavior).
Here's a summary of U.S. consumer responses when asked about their frequency of engaging with brands/advertising via the Internet and social media during the past year:
- Following a brand on Twitter: 82% have never done this, 4% are doing it more often than a year ago, 1% less often, and 9% with the same frequency.
- Promoting a brand or ad on their social networking pages or becoming a brand fan: 63% have never done, 9% are doing more often, 6% less often, and 18% with the same frequency.
- Sharing links to ads that they like with friends: 55% have never done, 7% are doing more often, 9% less often, and 26% with the same frequency.
- Searching for an ad on the Internet (e.g. YouTube): 51% have never done, 8% are doing more often, 12% less often, and 27% with the same frequency.
But according to this survey -- remembering that it was conducted online -- Americans are even more attached to the Internet: 58% said they can't live without it, and 31% said they'd miss it a great deal if it wasn't there. Just 10% said they like it but don't need it, and 1% that they could easily live without it.
More than one-third (35%) said they can't live without their mobile phones, and another 28% would greatly miss them.
In comparison, 25% of Americans said they would greatly miss newspapers, and 10% that they can't live without them, while 23% and 6%, respectively, expressed those opinions about magazines.
Looking at perceptions about the amount of advertising in various media, 71% of Americans said there are too many ads on TV -- although 26% actually said that the number is about right, and 1% would be "happier to see or hear more ads."
Print media came out more favorably. Just 30% and 54% said that there are too many ads in newspapers and magazines, respectively, while 61% and 40% said that the number of ads is just right in newspapers and magazines, respectively. Four percent would like to see more ads in newspapers, and 2% would like to see more in magazines.
As for the new advertising frontier of mobile phones, 39% feel that the current number of ads is about right, versus 28% who already view advertising as too intrusive. Nearly a third (31%) were undecided.
How many would be willing to be exposed to more ads if they were paid for it? For both TV and the Internet, more than half (52%) said they would agree to be exposed to more ads, while 40% would not be willing. Slightly more - 54% -- would be willing to view more ads on their cell phones if they were paid to do so, although 31% said they would not be willing.
Looking at ad content, novelty appears to be more important than perkiness to U.S. consumers. Asked what characteristics their favorite ads tend to have in common, 21% chose "innovative/unique," 17% chose "spontaneous/playful," 15% chose "logical/straightforward," and 12% "optimistic/happy."
Friday, December 4, 2009
IAB: 'Advertising Is Creepy'
Faced with increasing pressure from Washington, the Interactive Advertising Bureau launched a public service campaign on Thursday aimed at educating consumers about behavioral targeting.
The online campaign, created pro bono by WPP's Schematic, features rich media banner ads with copy like "Advertising is creepy" and "Hey, this banner can tell where you live. Mind if we come over and sell you stuff?"
More than one dozen publishers -- including Microsoft, Google's YouTube, and AOL -- have committed to donate a combined 500 million impressions for the initiative.
The campaign comes as policymakers are questioning whether data collection by marketers violates consumers' privacy. Rep. Rick Boucher (D-Va.) has said he plans to introduce a bill that could require Web companies to notify users about online ad targeting, and in some circumstances, obtain their explicit consent.
In addition, the Federal Trade Commission has criticized the industry for using dense privacy policies to inform people about behavioral targeting, or tracking people online and sending them ads based on sites visited.
In a meeting with reporters Thursday morning, IAB President and CEO Randall Rothenberg said one goal of the campaign is to address regulators' concerns that consumers don't understand behavioral advertising.
The ad units themselves offer information about online ad techniques. For instance, users who mouse over the "creepy" banner can pull down copy stating that companies don't use "personally identifiable information" to determine which ads to serve.
Users who click through land on the IAB's Privacy Matters page, which includes a description of various forms of online advertising, information about cookies (including Flash cookies) and links to opt-out pages.
The portion of the landing page devoted to cookies says they "contain data that allow a Web site to customize content and advertising to your interests but generally do not contain personally identifiable information." A section with information about geotargeting states that an IP address "reveals nothing personal about you to marketers and websites."
But privacy advocate Jeff Chester immediately raised questions about such statements. "They are ignoring the growing consensus that cookies and IP addresses are personally identifiable," says Chester, executive director of the Center for Digital Democracy.
Cathy Dwyer, a privacy expert and professor of information systems at Pace University, also questions whether the banners' headlines are too sophisticated to draw in users. "Even 'creepy' itself is a technical term," she says, adding that it's mainly industry insiders and observers who use that word in discussions about behavioral advertising.
The FTC said this year in its report about online behavioral targeting that non-personally identifiable information could be used to identify specific users.
In the past, industry groups and observers defined personally identifiable information as names, addresses, phone numbers or other information that could be used to contact an individual directly.
Critics recently moved away from that definition, in part because Web users have been identified based on supposedly anonymous data. The most famous example occurred in 2006, when AOL publicly released search logs showing users' queries and "anonymized" IP addresses for more than 600,000 users, Within days, one "anonymized" user, Thelma Arnold, was profiled in The New York Times after reporters identified her based on her search queries.
Schematic CEO Trevor Kaufman told reporters Thursday that a test of the campaign in late October and early November yielded a click-through rate of 0.5%. The trial involved 7 million impressions, mainly served on Microsoft's Hotmail.
Separately, the digital rights group Center for Democracy & Technology also launched a privacy campaign on Thursday -- although with a different goal. The CDT is hoping to persuade users to lobby Congress for online privacy legislation. The Web site for the CDT's "Take Back Your Privacy" campaign enables users to submit concerns directly to the FTC and to send emails to their lawmakers.
The online campaign, created pro bono by WPP's Schematic, features rich media banner ads with copy like "Advertising is creepy" and "Hey, this banner can tell where you live. Mind if we come over and sell you stuff?"
More than one dozen publishers -- including Microsoft, Google's YouTube, and AOL -- have committed to donate a combined 500 million impressions for the initiative.
The campaign comes as policymakers are questioning whether data collection by marketers violates consumers' privacy. Rep. Rick Boucher (D-Va.) has said he plans to introduce a bill that could require Web companies to notify users about online ad targeting, and in some circumstances, obtain their explicit consent.
In addition, the Federal Trade Commission has criticized the industry for using dense privacy policies to inform people about behavioral targeting, or tracking people online and sending them ads based on sites visited.
In a meeting with reporters Thursday morning, IAB President and CEO Randall Rothenberg said one goal of the campaign is to address regulators' concerns that consumers don't understand behavioral advertising.
The ad units themselves offer information about online ad techniques. For instance, users who mouse over the "creepy" banner can pull down copy stating that companies don't use "personally identifiable information" to determine which ads to serve.
Users who click through land on the IAB's Privacy Matters page, which includes a description of various forms of online advertising, information about cookies (including Flash cookies) and links to opt-out pages.
The portion of the landing page devoted to cookies says they "contain data that allow a Web site to customize content and advertising to your interests but generally do not contain personally identifiable information." A section with information about geotargeting states that an IP address "reveals nothing personal about you to marketers and websites."
But privacy advocate Jeff Chester immediately raised questions about such statements. "They are ignoring the growing consensus that cookies and IP addresses are personally identifiable," says Chester, executive director of the Center for Digital Democracy.
Cathy Dwyer, a privacy expert and professor of information systems at Pace University, also questions whether the banners' headlines are too sophisticated to draw in users. "Even 'creepy' itself is a technical term," she says, adding that it's mainly industry insiders and observers who use that word in discussions about behavioral advertising.
The FTC said this year in its report about online behavioral targeting that non-personally identifiable information could be used to identify specific users.
In the past, industry groups and observers defined personally identifiable information as names, addresses, phone numbers or other information that could be used to contact an individual directly.
Critics recently moved away from that definition, in part because Web users have been identified based on supposedly anonymous data. The most famous example occurred in 2006, when AOL publicly released search logs showing users' queries and "anonymized" IP addresses for more than 600,000 users, Within days, one "anonymized" user, Thelma Arnold, was profiled in The New York Times after reporters identified her based on her search queries.
Schematic CEO Trevor Kaufman told reporters Thursday that a test of the campaign in late October and early November yielded a click-through rate of 0.5%. The trial involved 7 million impressions, mainly served on Microsoft's Hotmail.
Separately, the digital rights group Center for Democracy & Technology also launched a privacy campaign on Thursday -- although with a different goal. The CDT is hoping to persuade users to lobby Congress for online privacy legislation. The Web site for the CDT's "Take Back Your Privacy" campaign enables users to submit concerns directly to the FTC and to send emails to their lawmakers.
Thursday, December 3, 2009
Newspaper Group Argues Against Opt-In Consent For Behavioral Targeting
The Newspaper Association of America is touting online behavioral targeting as a partial fix for the industry's revenue woes.
"Targeted advertising shows significant promise for newspapers seeking new ways to support local journalism," the organization writes in comments filed with the Federal Trade Commission. The comments were filed in advance of this week's FTC public workshops about media, "From Town Crier to Bloggers: How Will Journalism Survive the Internet Age."
Sophia Cope, legislative counsel at the NAA, adds that members of Yahoo's newspaper consortium have benefited from the company's online ad-targeting capabilities. "Based on preliminary results, it looks like targeted advertising will be one of the solutions that helps newspapers get back some of their revenue," she says. The NAA says that Yahoo's newspaper consortium has generated at least $50 million since last year. The initiative involves Yahoo powering behavioral targeting for some newspapers' Web sites, among other features.
"The newspaper industry wants the flexibility to figure out what's going to work," Cope says. "The industry needs time to figure out what solutions will rise to the top and be successful."
The NAA estimates that by the end of December, newspapers' ad revenue will have plummeted almost 40% in two years.
The trade group argues in its comments that a regulatory framework requiring companies to obtain users' affirmative consent to online tracking for ad-targeting purposes would be impractical. "While newspapers support robust consumer notice and choice, newspapers worry that a government mandated 'opt in' choice mechanism for 'third party' targeted advertising may not be workable in practice," the organization writes. The NAA adds that requiring online readers to opt in during their initial visits would "degrade the user experience and make it difficult to communicate the benefits of targeted or interest-based advertising."
Privacy advocate Jeffrey Chester, executive director of the Center for Digital Democracy, says he disagrees with the NAA's stance. "It would be more effective for newspapers' branding to be known as the place where privacy is respected," he says. "Just because everybody is engaged in this data collection melee doesn't mean everyone has to do it."
Chester, who is also slated to speak at the FTC's workshops this week, adds that many people visit news sites without realizing the extent to which they collect data. "Few readers know that readers know that newspapers are stealthily watching every story they read, tracking them story to story," he says. "No one knows that news sites have become a data collection den."
Current industry self-regulatory guidelines and FTC recommendations call for companies to notify consumers about online ad targeting and allow them to opt out. Chester and other privacy advocates have recommended moving to a system where Web sites and ad companies can collect and retain non-sensitive information about computer users for up to 24 hours, unless people opt out. After that initial period, the companies would need consumers' opt-in consent to retain the data.
Marking an apparent shift from its position last year, the newspaper organization praised the FTC's recent endorsement of a voluntary notice and opt-out regime. But in 2008, the NAA warned that even voluntary guidelines could have an impact on newspapers' First Amendment rights.
Other people scheduled to speak at the workshops include News Corp. chief Rupert Murdoch, Magazine Publishers of America CEO Nina Link, Ball State University's Mike Bloxham, the Online Publishers Association President Pam Horan, and Interactive Advertising Bureau Research Director Joe Laszlo.
"Targeted advertising shows significant promise for newspapers seeking new ways to support local journalism," the organization writes in comments filed with the Federal Trade Commission. The comments were filed in advance of this week's FTC public workshops about media, "From Town Crier to Bloggers: How Will Journalism Survive the Internet Age."
Sophia Cope, legislative counsel at the NAA, adds that members of Yahoo's newspaper consortium have benefited from the company's online ad-targeting capabilities. "Based on preliminary results, it looks like targeted advertising will be one of the solutions that helps newspapers get back some of their revenue," she says. The NAA says that Yahoo's newspaper consortium has generated at least $50 million since last year. The initiative involves Yahoo powering behavioral targeting for some newspapers' Web sites, among other features.
"The newspaper industry wants the flexibility to figure out what's going to work," Cope says. "The industry needs time to figure out what solutions will rise to the top and be successful."
The NAA estimates that by the end of December, newspapers' ad revenue will have plummeted almost 40% in two years.
The trade group argues in its comments that a regulatory framework requiring companies to obtain users' affirmative consent to online tracking for ad-targeting purposes would be impractical. "While newspapers support robust consumer notice and choice, newspapers worry that a government mandated 'opt in' choice mechanism for 'third party' targeted advertising may not be workable in practice," the organization writes. The NAA adds that requiring online readers to opt in during their initial visits would "degrade the user experience and make it difficult to communicate the benefits of targeted or interest-based advertising."
Privacy advocate Jeffrey Chester, executive director of the Center for Digital Democracy, says he disagrees with the NAA's stance. "It would be more effective for newspapers' branding to be known as the place where privacy is respected," he says. "Just because everybody is engaged in this data collection melee doesn't mean everyone has to do it."
Chester, who is also slated to speak at the FTC's workshops this week, adds that many people visit news sites without realizing the extent to which they collect data. "Few readers know that readers know that newspapers are stealthily watching every story they read, tracking them story to story," he says. "No one knows that news sites have become a data collection den."
Current industry self-regulatory guidelines and FTC recommendations call for companies to notify consumers about online ad targeting and allow them to opt out. Chester and other privacy advocates have recommended moving to a system where Web sites and ad companies can collect and retain non-sensitive information about computer users for up to 24 hours, unless people opt out. After that initial period, the companies would need consumers' opt-in consent to retain the data.
Marking an apparent shift from its position last year, the newspaper organization praised the FTC's recent endorsement of a voluntary notice and opt-out regime. But in 2008, the NAA warned that even voluntary guidelines could have an impact on newspapers' First Amendment rights.
Other people scheduled to speak at the workshops include News Corp. chief Rupert Murdoch, Magazine Publishers of America CEO Nina Link, Ball State University's Mike Bloxham, the Online Publishers Association President Pam Horan, and Interactive Advertising Bureau Research Director Joe Laszlo.
Wednesday, December 2, 2009
3 Ways to Guard Against Click Fraud
By Heather Fletcher
No one likes to be cheated. And click fraud touches a raw nerve for many marketers. So New York-based online advertising network Undertone Networks identified some best practices for agencies and advertisers to ensure the safety of online ads and the brands they represent.
Click Forensics reported in October that the average click fraud rate for the third quarter of 2009 was 14.1 percent, up from 12.7 percent during the previous quarter. "As advertisers, publishers and ad networks are getting smarter, so are the attackers," according to Undertone. "A recently uncovered click fraud ring run out of China involved 200,000 IP addresses and more than $3 million worth of fraudulent clicks."
Undertone provides the following advice:
1. Engage the ad server as the first line of defense: Most ad servers allow advertisers to pull reports on the country of origin for impressions and clicks. Do your homework on your ad-serving platform to understand how it counts and handles click fraud, and closely monitor site visitors, time spent and activity related to each click. These related measurements help you identify not only fraudulent activity, but which clicks are truly valuable.
2. Don't pay for irrelevant international impressions: Up to 40 percent of publisher site traffic comes from outside the United States, and ad networks are used as a clearinghouse for this inventory. Too often, unsuspecting advertisers serve domestic creative to international audiences who can't act. Unless international users are your target, specify U.S. traffic only in your insertion orders. A growing percentage of click fraud is through foreign IP addresses, so monitoring this traffic will reduce your exposure.
3. Modify terms and conditions on media contracts: By far, the most proactive measure advertisers can take to prevent fraud is to modify the contracts they use with media partners. These amendments include specifically excluding incentivized traffic, use of ad exchange inventory, as well as practices like ad stacking (when a click on one ad actually generates clicks on other associated ads) and daisy-chaining (when the original ad host recycles ads to other sites in order to boost revenue), which makes companies more vulnerable for click fraud.
No one likes to be cheated. And click fraud touches a raw nerve for many marketers. So New York-based online advertising network Undertone Networks identified some best practices for agencies and advertisers to ensure the safety of online ads and the brands they represent.
Click Forensics reported in October that the average click fraud rate for the third quarter of 2009 was 14.1 percent, up from 12.7 percent during the previous quarter. "As advertisers, publishers and ad networks are getting smarter, so are the attackers," according to Undertone. "A recently uncovered click fraud ring run out of China involved 200,000 IP addresses and more than $3 million worth of fraudulent clicks."
Undertone provides the following advice:
1. Engage the ad server as the first line of defense: Most ad servers allow advertisers to pull reports on the country of origin for impressions and clicks. Do your homework on your ad-serving platform to understand how it counts and handles click fraud, and closely monitor site visitors, time spent and activity related to each click. These related measurements help you identify not only fraudulent activity, but which clicks are truly valuable.
2. Don't pay for irrelevant international impressions: Up to 40 percent of publisher site traffic comes from outside the United States, and ad networks are used as a clearinghouse for this inventory. Too often, unsuspecting advertisers serve domestic creative to international audiences who can't act. Unless international users are your target, specify U.S. traffic only in your insertion orders. A growing percentage of click fraud is through foreign IP addresses, so monitoring this traffic will reduce your exposure.
3. Modify terms and conditions on media contracts: By far, the most proactive measure advertisers can take to prevent fraud is to modify the contracts they use with media partners. These amendments include specifically excluding incentivized traffic, use of ad exchange inventory, as well as practices like ad stacking (when a click on one ad actually generates clicks on other associated ads) and daisy-chaining (when the original ad host recycles ads to other sites in order to boost revenue), which makes companies more vulnerable for click fraud.
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